Displaying items by tag: South Korea

South Korea/Egypt: The South Korean government’s 72% ‘anti-dumping duty’ on imports of white cement from Egypt entered force on 17 November 2023. Yonhap English News has reported that the measure will remain in force for four months, until 17 March 2023.

Egypt exported 9240t of white cement to South Korea in 2022, up by a factor of nine from 2021 levels.

South Korea/Egypt: The South Korean government plans to implement a 72% import duty on white cement from Egypt. Yonhap News has reported that the Korea Trade Commission (KTC) recommended the duty as an anti-dumping measure, following its investigation into the impacts of Egyptian imports on the South Korean white cement industry. This consists of Union Corporation’s 200,000t/yr Chongju white cement plant in North Chungcheong.

South Korea consumed 100,000t of white cement in 2022. Egyptian white cement commanded a 10% (10,000t) market share. The domestic cement industry complained to the KTC against Royal El Minya Cement and Albatros International Cement Trading in March 2023. An additional probe will now follow to assess the correct rate for the duty.

South Korea: The Korean Railway Workers’ Union called a four-day strike of its 13,000 members across South Korea on 14 September 2023. Reuters has reported that the union is seeking higher pay, improved working conditions and the expansion of bullet train services into South Seoul. The Ministry of Transport predicts that total cargo haulage will drop by 53 - 79%. The Korean Cement Association (KCA) said that a protracted strike would disrupt cement production. The industry is 40% reliant on rail transport.

A representative from a KCA member said “We have secured some inventory in preparation for the strike, but it's not a lot. If the strike lengthens, we will have to convert to land transport, which will drive up costs and hit profitability."

South Korea: The Ministry of Trade, Industry and Energy (MOTIE) launched the Carbon Neutrality Grand Consortium on 5 September 2023. It aims to roll-out its US$31m CO₂ neutrality technology development project, launched earlier in 2023, across all industry sectors, including cement production. The government will assist companies by investing more than 80% of the total project budget into demonstration projects by 2030.
The Carbon Neutrality Grand Consortium is split into four sub-consortiums: steel; petrochemicals; semiconductors/displays; and cement. Unusually, the results will be made available to companies that are not participating in projects of their own, in order to accelerate the exchange and spread of carbon neutrality technologies and successful outcomes across all sectors.

MOTIE’s Vice Minister Youngjin Jang stated that carbon neutrality within South Korean industry depended on the development of an innovative technologies that enable ground-breaking carbon reductions without disrupting productivity, while also pursuing solidarity and cooperation with other firms to spread the breakthrough technology across the entire industrial ecosystem.

South Korea: A strike forced Korea Cement to suspend production at its integrated Jangseong cement plant from 8am on 13 June 2023. Investing News has reported the cause of the strike as a dispute over collective bargaining between the company and workers at the plant.

Korea Cement said “If the production suspension continues for more than six months, the company may be subject to delisting review by the Korea Exchange."

South Korea: The Korea Trade Commission (KTC) has launched a probe into imported white cement from Egypt. The commission will investigate the possible necessity of anti-dumping duties on imports of the product. Yonhap English News has reported that the KTC is responding to a complaint from domestic white cement producer Union Corporation. The producer accuses International Cement Trading and Egypt-based Royal El Minya Cement of damaging its business through cement dumping. The KTC will complete its preliminary investigation before 1 September 2023.

South Korea: SungShin Cement recorded full-year consolidated sales of US$792m in 2022, up by 24% year-on-year from US$641m in 2021. The producer recorded a net loss of US$19.5m, compared to US$5.01m net profit in 2021.

Adani Cement’s dispute with truck driver unions in Himachal Pradesh is about to enter its fifth week. The standoff began on 15 December 2022 when the company closed its integrated plants at Darlaghat and Barmana in response to union freight rates. A third unit, a grinding plant at Nalagarh, reportedly continued to operate for a few days longer with raw materials supplied from neighbouring Punjab and Rajasthan, until the transport companies shut down its supply.

Adani Group took over the plants from Ambuja Cement and ACC following its acquisition of Holcim’s India-based businesses in September 2022. The new business seemed to be running smoothly as new officials were appointed and an alternative fuels subsidiary, Geoclean, was created. Then Adani Cement closed its two plants in Himachal Pradesh. In a statement the group said, “Our plants at Gagal (Barmana) and Darlaghat have been incurring losses for quite some time now with no signs of improvement due to stiff resistance from transportation unions ignoring the larger cause of employment generation and contribution to the state’s revenue.” The group added that it had requested the truckers reduce the freight rate to around US$0.07/t/km from US$0.14/t/km, with the lower rate previously recommended by a committee from the state’s transport department.

Himachal Pradesh held state elections in mid-November 2022 with the Indian National Congress (INC) party taking control of the state government from the Bharatiya Janata Party (BJP). The results of the poll were revealed about a week before the cement plants closed and the new administration has suffered a bumpy start to its tenure. At first the state government issued a show cause notice to the cement producer requesting that it explain the closures or else risk ‘appropriate administrative action.' Several rounds of talks followed to no avail. Most recently, a government subcommittee has been set up that will bring together representatives of Adani Cement and the truck unions to try and agree on new freight rates.

In production terms the closure of the Darlaghat and Barmana cement plants is a big deal in the state, given that they have a combined cement production capacity of 6Mt/yr from the region’s total integrated capacity of 10.5Mt/yr. Data is limited on the direct effects of the standoff on the cement and construction market so far. However, competitor UltraTech Cement may be benefiting as it was swiftly awarded the supply contract for government projects. Local press reports have also noted that some of the unions have been stopping cement trucks from entering the state.

What is clearer is the human side to the dispute. Around 1000 staff are employed both directly and indirectly at the Barmana plant and others have jobs at Darlaghat and Nalagarh. Adani Group has relocated at least 140 staff from both sites during the closures. In addition over 7000 drivers were supporting both plants. Even more people have jobs connected to the plants, their supply chains and markets.

The argument between Adani Cement and the truck driver unions in Himachal Pradesh needs to be resolved soon for the good of everybody. Rising fuel costs are the driver of this situation, although it would be interesting to know why the other cement producers in the state haven’t similarly reacted against high freight rates in the same way. India isn’t the only country where the cement sector has been affected by driver union activity. South Korea endured a series of driver strikes in the autumn of 2022 that disrupted the cement sector. Eventually the government enacted laws to restrict strikes that might cause disruption to key areas such as cement production. The International Monetary Fund (IMF) forecasts that global inflation rates will stabilise in 2023 after a sharp rise in 2022. Growth rates are also predicted to slow. As societies and companies adjust to this it seems likely that there will be more clashes between companies, unions and other organisations as everybody tries to absorb higher costs.

South Korea: The government ordered 2500 cement truck drivers to return to work on 29 November 2022. The Korea Herald newspaper has reported that drivers in the sector who continue their strike will be subject to criminal sanctions of up to three years in prison or a US$22,600 fine, and will have their truck driving licences suspended. The government explained that the order is justified due to cement truck drivers' failure to present 'good cause' for the industrial action.

President Yoon Suk-Yeol said "Taking the livelihoods of ordinary people and the national economy hostage to look out for their own needs is not justifiable."

Cement truck drivers make up 35% of a total 7080 truck drivers from 200 companies across the South Korean economy participating in the strike, which began on 24 November 2022.

South Korea: Cement producers say that an on-going truck drivers' strike will force them to suspend production from 5 December 2022 if it continues for another week. Yonhap English News has reported that Industry Minister Lee Chang-Yang spoke to industry representatives on a visit to Asia Cement's Jecheon cement plant in Chunbuk. The cost of missed deliveries after four full days of the strike on 28 November 2022 was US$34.6m.