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* Massive platinum strike starts
* Half of world platinum production affected
* Police out in force near Lonmin's Marikana mine
* Court halts threatened stoppage in gold sector
(Adds more details And quotes)
By Ed Stoddard
RUSTENBURG, South Africa, Jan 23 (Reuters) - South African mines producing half the world's platinum shut down on Thursday as the country's hardline miners union began a strike for hefty pay hikes their employers say they cannot pay.
Members of the Association of Mineworkers and Construction Union (AMCU), the sector's main union, downed tools at Anglo American Platinum
The chief executives of the three producers have said the wage demands are "unaffordable and unrealistic" and warned the industry could ill afford further production and job losses.
Amplats said the strike had affected mining at three of its sites - Rustenburg, Union and Amandelbult - where low attendance was recorded. All its processing operations were operating normally, it said.
Implats closed its mines, processing units and smelter at Rustenburg, northwest of Johannesburg, on Wednesday ahead of the strike to ensure the safety of its employees.
AMCU, whose emergence two years ago has thrown labour relations in the mining industry into turmoil, has as many as 100,000 members in the platinum belt, 120 km (70 miles) northwest of Johannesburg.
It was unclear if all AMCU members had heeded the call to strike but dozens of strikers gathered outside some mines early on Thursday.
Several AMCU activists danced and sang songs calling on President Jacob Zuma and the African National Congress (ANC) officials to "stop the foolishness".
"We are paid peanuts. And the cost of living is too high," said one striker at an Amplats mine.
"If they don't meet our demands, we will keep striking."
GOVERNMENT MEDIATION
The government, led by Deputy President Kgalema Motlanthe, has offered to mediate to try to end the dispute, which threatens to further squeeze an already struggling economy.
Besides the economic damage, Zuma and the ANC are keen to end labour unrest ahead of general elections expected in around three months.
The companies have indicated that they are willing to engage with AMCU but the union was yet to respond.
"Striking is not a constructive solution if we are to return the company to a sustainable financial footing and secure existing jobs," Amplats chief executive Chris Griffith said in a statement.
AMCU is seeking a more than doubling of the basic entry-level wage from Amplats and Lonmin and smaller but still steep hikes from Implats. The companies are offering increases of 7.5-8.5 percent, well above the 5.4 percent inflation rate.
The firms were battered by wildcat strikes in 2012 rooted in a turf war between AMCU and the National Union of Mineworkers (NUM) in which dozens of people were killed.
POLICE DEPLOYMENT
Mindful of the bloodshed and violence of the last two years, police deployed in force, especially near Lonmin's Marikana mine where 34 striking miners were shot dead by police in August 2012.
AMCU had also planned to strike at several gold mines on Thursday but a court ruled the action be suspended pending a review of its legality.
It is hard to estimate the duration of the stoppage in the platinum sector amid recent signs of divisions in AMCU's ranks.
Dissidents said this week they planned to form a rival union, accusing AMCU's leaders, especially president Joseph Mathunjwa, of recklessly pursuing a damaging strike they say many miners do not want and cannot afford.
But AMCU activists in Rustenburg said the workers remained committed to a stoppage.
(Additional reporting by Olivia Kumwenda-Mtambo and Dinky Mkhize; Writing by Olivia Kumwenda-Mtambo; Editing by Tom Heneghan)
((Edward.Stoddard@thomsonreuters.com)(+27 11 775 3160)(Reuters Messaging: edward.stoddard.thomsonreuters.com@reuters.net))
Keywords: SAFRICA STRIKES/