The industry association representing 32 petrochemical companies in South Korea said its member companies’ average daily shipments dropped by 90% due to the strike, now on Saturday. .
“The collective action of Cargo Truckers Solidarity to deny shipping is spreading damage to major petrochemical complexes in Ulsan, Yeosu and Daesan,” the Korea Petrochemical Industry Association said.
The 22,000-strong union is protesting against soaring fuel prices and demanding a guaranteed minimum wage. Four rounds of negotiations with the government failed to find a compromise.
It was not confirmed if the companies had cut operations, but a source at a major petrochemical company told Reuters most companies were still storing finished products in the hope of being able to resume operations. move again.
Automakers, hit hard by their inability to receive parts supplies and ship finished products in a timely manner, have also set up a task force within their trade association to monitor the situation. and call for an early solution.
Steel maker POSCO said it will suspend some plants due to lack of space to store products that have not yet been shipped. Automaker Hyundai Motor has cut output at some lines and cement manufacturers have also cut operations.
The protracted labor conflict could make President Yoon Suk-yeol, a political novice who took office five weeks ago, potentially distracting from his conservative agenda and making increased risk of long-term antagonism with powerful unions.
The government has called on truckers to return to work but said it would seek to reflect their demands in the legislative process and continue to try to end the conflict through dialogue.
Truck owners are asking for an extension of the subsidy, which is due to expire this year, to secure minimum wages as fuel prices rise. The government said it was up to parliament to change the law.
As the global economy grapples with supply bottlenecks, any prolonged decline in chip, petrochemical and auto production and shipments could add to concerns about rising inflation and growth slowed down.
South Korea’s inflation will hit a 24-year high of 4.8% this year, the Korea Organization for Economic Cooperation and Development said last week, while cutting its growth forecast to 2. 7% from the December forecast of 3.0%.
