Mineworkers at the Modikwa platinum mine in South Africa have agreed a new pay deal, thereby averting strike action, it has been announced today.

The South African National Union of Mineworkers (NUM) explained that a deal had been reached at the Modikwa mine, a joint venture between African Rainbow Minerals and the world's largest platinum producer, Angloplat, that employs 1,473 workers.

Reuters reports that mineworkers were demanding a 10 per cent pay rise, but with management only offering five per cent the NUM declared a dispute last month - the first stage towards industrial action.

However, following talks with government mediators, a two-year deal has been agreed which will see workers receive a five per cent increase effective from January and an additional three per cent in August.

An NUM statement explained: "At the time of settlement the union had already received a certificate to strike and had given management notice. As a result of the settlement, the union has suspended the strike action."

Last year, 172,400 ounces of refined platinum was produced at the Modikwa mine.