South Korean production and shipping disrupted as truckers strike for third day

Thousands of South Korean truckers went on strike for a third day on Thursday to protest the sharp surge in fuel costs, disrupting production, slowing activity at ports and posing new risks to a strained global supply chain.

Presenting new President Yoon Suk-yeol with one of his first big economic challenges, about 7,200 members or roughly 30% of the Cargo Truckers Solidarity union were on strike, the country’s transport ministry said.

A union official said the number of participating members was much higher and they were also joined by non-union truckers.

Among companies feeling the pain was steelmaking POSCO, which has been unable to ship about 35,000 tonnes of steel products from two plants daily since the strike began.

Automakers too were suffering. The union said it had asked both union members and non-union truckers not to make deliveries to Hyundai Motor Co’s plants in Ulsan.

An official with the Korean Shippers’ Council said the impact was being felt at ports. “There’s only a minimal amount of cargo getting into ports right now. Until yesterday, the situation may have appeared okay because some pre-arranged cargoes were being delivered but the reality now is that it is very difficult.”

The Busan Port Authority confirmed that the port’s container occupancy rate is 76.3%, up from 73.9% two days ago.

Why are drivers protesting?

The truckers, regarded as self-employed contractors in South Korea, are seeking pay increases and a pledge that an emergency measure guaranteeing freight rates, which was introduced amid the pandemic, will be extended. They also want it to apply to a wider range of trucks, not just container trucks and cement trucks.

“Due to skyrocketing fuel prices and the government not acting enough to protect our livelihood, our frustration is only growing and growing”. Kim Jae-kwang, a senior union official, added: “Large cargo truck drivers are paying an additional 3 million won ($2,390) in fuel costs when their monthly pay is around 3 to 4 million won”.

($1 = 1,256.2200 won)

Source: Reuters