The global iron ore export hub faces a new wage deadlock! BHP Port Hedland workers to seek arbitration over wage agreement dispute.

According to reports from Zhihu Finance APP, the BHP Port Workers' Union, representing port facility workers for global mining giant BHP (BHP.US) at Port Hedland in Australia, stated on Tuesday that workers will seek arbitration after both parties failed to reach an agreement on the terms of a new salary deal.

The BHP Port Workers' Union represents around 450 operators and maintenance workers at the Port Hedland port facilities. The union will apply for a determination of "intractable bargaining," which would allow the regulatory agency, the Fair Work Commission, to set the terms of the agreement for both parties.

The union and BHP have been negotiating a four-year salary deal for over nine months. In recent months, both sides have held nearly weekly meetings with the assistance of regulators to determine the specific terms of this four-year salary agreement.

In a statement, the union said: "BHP is unwilling to negotiate an agreement that reflects the professional skills, harsh working environment, and enormous personal sacrifices made by these employees, who have generated over AUD 13 billion in profit for the company this year."

A BHP spokesperson responded: "Our focus remains on reaching a fair and reasonable agreement." The mining giant stated its latest offer was made a week ago, and added that continued negotiations are the fastest way to reach a result.

For most employees, BHP proposed a 17% wage increase over the four-year term of the agreement, including a transitional payment of AUD 25,000 (approximately USD 17,800), to be paid over two years, as well as an increase in shift allowances. However, the union believes that under this plan, about 40% of employees would see their actual compensation worsen.

The protracted negotiations over salaries between BHP and Port Hedland workers could impact the global iron ore supply chain. Port Hedland is one of the world's largest iron ore shipping ports and the largest iron ore export port in Australia. The port is connected to several BHP mines in the Pilbara region and handles all of the company's iron ore export business in Western Australia. Data shows that about AUD 80 million worth of BHP iron ore products are shipped through the port every day. Any disruption to operations at Port Hedland could result in significant economic losses and put pressure on the global iron ore supply chain.

In August, workers at the port staged a two-day strike, marking the first major industrial action at the port in 25 years. If negotiations fail to make continued progress, potential strikes could affect the daily operations of this global iron ore export hub.