Trucker strike nearly cripples Colombia trade

Author: Marianela Toledo

2016/07/18

Venezuelan citizens cross the border with Colombia to buy food and other products in San Jose de Cucuta on 10 July. (Xinhua News Agency/REX/Shutterstock)
Government protected caravans deliver essential goods as thousands of Venezuelan shoppers flood across the border, but petrochemicals remain in the warehouse. (Xinhua News Agency/REX/Shutterstock)

Focus article by Marianela Toledo

HOUSTON (ICIS)--Colombia seems to be facing a growing supply and demand problem: too much material to move, not enough trucks to move it.

Commercial truck drivers went on strike 43 days ago, impacting the petrochemical industry and causing basic goods shortages across the country.

At the same time, Venezuela has temporarily opened the border between the two countries, prompting a flood of people seeking to purchase basic goods and supplies amid shortages at home. The border had been closed for more than a year. 

The weekend of 15 July saw more than 100,000 Venezuelans cross over for food, goods and services, according to Colombia officials. That was the second time this month.

Although it could present an increase of demand for Colombian businesses, the timing is bad.

On Sunday, Colombian Defense Minister Luis Carlos Villegas said that a "special convoy" brought supplies to the city of Cucuta, which borders the city of Táchira in Venezuela, to ensure enough necessities for the Venezuelans.

"A cargo of more than 9,500 tractor-trailers have been transported through the Magdalena river and via the train that connects Tunja with Bogotá,” Villegas said in a press release. “[Those are] alternative ways of transport made available by the national government to facilitate the movement of goods in the midst of the truckers strike ….”

But Colombians themselves are suffering from shortages of products, along with other problems caused by the trucker strike.

The strike has caused huge business losses, because there is no way to bring resins and raw materials from Cartagena to Bogota, one polystyrene (PS) seller said.

Cartagena, Barranquilla and Santa Marta on the Caribbean coast, and Buenaventura and Tumaco on the Pacific coast are Colombia’s most important port terminals.

As a result of the strike, there are shortages of food, personal hygiene products and other basic goods impacting most cities, the source added.

The seller said it has no resin to sell, because of low inventories. Hence, processors do not have products to deliver to other cities like Medellin or Cali.

“[Plastic] inventories are low,” the source said.

An importer of PS, polypropylene (PP) and polyethylene (PE) resins agreed.

“We have materials stuck there" in the port, the importer said, adding that it has been receiving order requests from competing buyers, but it has nothing to offer, even at higher prices.  

The importer also said that “prices have increased a lot” for basic goods and the truckers' protest fuels a sense of insecurity because drivers fear reprimands if they don’t heed the strike.  

The defence minister said that protesters tried to set fire to a passing truck on the road that connects Bogota and Villavicencio. That truck was not travelling in a caravan.

Villegas stressed that carriers and cargo companies that want to provide services need to contact the defence ministry authorities to coordinate security measures.

The commercial transportation strike started on 8 June. The union workers want the government to lower tolls and gasoline prices, and to raise shipping rates.

Workers have yet to reach agreement with the government over when to return to work.

INSET IMAGE: Venezuelan citizens cross the border with Colombia to buy food and other products in San Jose de Cucuta on 10 July. (Xinhua News Agency/REX/Shutterstock)