NewsFlashTransport strike in Yeosu affects plants

12 June 2008 02:44  [Source: ICIS news]

SINGAPORE (ICIS news) – The Transportation Industry Nationwide Labor Union of Korea has gone on strike and should the situation continue, petrochemical companies in the area would be greatly affected, a source whose company is in Yeosu said on Thursday.

 

“All transportation has ceased as the union is on strike, asking for lower diesel prices and higher transportation fees,” the source said in Korean.

 

Crude has seen new historic highs just last week on the weakening dollar and a US government report which indicated that the unemployment rate was the highest in almost two decades.

 

Transportation of ethylene, propylene and other feedstocks may not be directly affected by the strike as most companies have pipelines for such purposes, the source said.

 

“Polyethylene (PE) and polypropylene (PP) distribution will be impossible soon,” said another source with a petrochemical plant in the area.

 

Should transportation of downstream products continue to be affected, companies will have to reduce their production rates, which in turn will affect all other upstream products due to demand problems. This may lead to the shut down of most plants and even the naphtha crackers, the first source added.

 

Companies in the region that may be affected are GS Caltex, Daelim Industries, LG Chemical, Honam Petrochemical, Hanwha Chemical, Polymirae, Yeochun Naphtha Cracking Center and Kumho P&B Chemicals.

 

Steve tan contributed to this story

By: Brian Myung
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