Concrete mixer trucks are parked at a factory due to a strike by a truckers' union in Anyang, South Korea November 28, 2022. Yonhap via REUTERS
SEOUL: South Korea’s government planned to meet the country’s striking truckers’ union for talks for the first time yesterday since a nationwide walkout began six days ago, as supply chain glitches worsen and construction sites face concrete shortages.
With supplies of cement and fuel for gas stations running short, the government has elevated its warning of cargo transport disruption due to the strike to “serious”, the highest level in its disruption scale, the transport ministry said yesterday.
But a union statement on Sunday offered little prospect of a breakthrough in the dispute.
“The transport ministry’s position is already set and there is no room for negotiations, so this meeting is not a negotiation. The content is a demand for an unconditional return to work,” the union said.
The second major strike in less than six months by thousands of unionised truckers for better pay and working conditions was criticised last week by South Korean President Yoon Suk-yeol as taking the nation’s logistics “hostage” in the face of an economic crisis.
The strike organiser, the Cargo Truckers Solidarity Union (CTSU), has criticised the government for only being willing to expand the minimum pay “Safe Freight Rate” system for three more years, instead of making it permanent and expanding its application as the union demands.
According to South Korean law, during a serious disruption in transport, the government may issue an order to force transport workers back to their jobs.
Failure to comply is punishable by up to three years in jail or a fine of up to 30 million won (US$22,550 or RM102,044).
Disruptions to industry from the strike come with the export-dependent economy, Asia’s fourth-largest, already facing lower-than-expected growth next year, with the central bank downgrading South Korea’s 2023 growth forecast to 1.7% from 2.1% previously.
Container traffic at ports dropped to 7.6% of normal levels on Sunday, the transport ministry said, down from 17% of normal levels earlier in the day.
Major steel companies Pohang Iron and Steel Co and Hyundai Steel saw shipments drop by 5% or less last week compared with usual levels, according to two industry sources who spoke on condition of anonymity as they were not authorised to discuss the matter with the media.
Gas stations may run out of fuel this week, especially in large cities. While stations secured inventory before the strike, about 80% of truckers for major refiners such as SK Energy and S-Oil Corp are striking.
In the construction sector, ready-mix concrete work has been suspended since last week at 259 out of 459 sites nationwide, with almost all sites expected to run out of concrete by today, Yonhap news agency said, citing unidentified sources in the concrete industry.
As of Saturday, the cement industry estimated an accumulated output loss of about 46.4 billion won (US$35mil or RM158.4mil), with shipments down to 9% of normal levels, according to lobby group Korea Cement Association.
“Non-union bulk cement truck owners, who are implicitly sympathetic to or in fear of the cargo union’s illegal activities, are giving up cement transportation,” the association said in a statement. — Reuters
