Northam Platinum has become embroiled in a wage dispute with the National Union of Mineworkers (NUM) after talks hit a stalemate.

The union issued a statement saying that the offer of a four per cent deal fell some way short of its ten per cent increase target.

Reuters reports that the two sides are now in stand off, with the declaration from the NUM signalling the commencement of the process of labour dispute.

Under the terms of South Africa's labour laws, this process must be initiated before strike action takes place – but there is some speculation now on the potential of any deal being reached before industrial action occurs.

The news comes in the wake of ongoing wage discussions among a number of platinum miners.

Yesterday the NUM said it had rejected Impala Platinum's offer of higher wages, citing the "healthy financial state" of the firm and the high price of platinum as grounds for better pay.

Northam has endured a torrid year, with a fire at one of its underground mines playing its part in an 18.3 per cent drop in pgm production in the first half of the current financial year.