South Korea govt plans first talks with striking truckers (updated)

HYUNDAI STEEL

28/11/2022 24:38

(Adds union stance, details of industry disruption)
    By Joyce Lee and Heekyong Yang
       SEOUL, Nov 28 (Reuters) - South Korea's government plans
to meet the country's striking truckers' union for talks on
Monday for the first time since a nationwide walkout began five
days ago, as supply chain glitches worsened and construction
sites faced 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 on
Monday.
    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
to 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 ($22,550).
    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
as of 5 p.m. local time (0800 GMT) on Sunday, the transport
ministry said, down from 17% of normal levels in the morning. 
    Major steel companies POSCO  005490.KS  and Hyundai Steel
 005490.KS  saw shipments drop to 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 media. 
    Gas stations may run out of gasoline and kerosene this week,
especially in large cities. While stations secured inventory
before the strike, about 80% of truckers for major refiners such
as SK Innovation's  096770.KS  SK Energy and S-Oil Corp
 010950.KS  are striking union members.
    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
Tuesday, Yonhap news agency said, citing unidentified concrete
industry sources. 
    The cement industry estimated an accumulated output loss
worth about 46.4 billion won ($35 million) as of Saturday, with
shipments down to 9% of usual levels, lobby group Korea Cement
Association said. 
    "Non-union bulk cement truck owners, who are implicitly
sympathetic or in fear of the cargo union's illegal activities,
are giving up cement transportation," the association said in a
statement. 
($1 = 1,334.5300 won)
 (Reporting by Joyce Lee and Heekyong Yang; Editing by
Muralikumar Anantharaman and Kenneth Maxwell)
 ((joyce.lee@tr.com;))