Thai Port Strike Hits Rubber Shipments

In Thailand, a railway and port strike is hitting the country’s rubber shipments, leading to foreign traders shifting their rubber import sources to Malaysia and Indonesia, say local exporters.

Union members with the State Railway of Thailand started their strike, held in sympathy with anti-government protesters, on 28 August, while Port Authority of Thailand union members brought Klong Toey port in Bangkok to a standstill on Wednesday 3 September. It reopened late on Friday 5, though activity has not yet reached its pre-strike levels.
The total cost and damage of the strike action has yet to be estimated.

Luckchai Kittipol, the president of the Thai Rubber Association, said that foreign traders had already halted purchases from Thailand as they were not confident in transhipment to customers. “Exporters hope the situation will return to normal soon,” he stated. Meanwhile, Von Bundit Ltd, Thailand’s biggest rubber exporter, said the railway strike had stalled about 2,000 tonnes a day of its shipments.
Von Bundit, which sold around 500,000 tonnes of rubber last year, has been particularly affected as it sends most of its goods by train to ports in Bangkok and Penang, Malaysia.

However, Luckchai, also chief executive of Thai Hua Rubber Plc, a major rubber producer, said his company had yet to see its transport stalled, as it had shifted to use trucking services and private ports to handle product delivery. As a result, Luckchai said the company had encountered transhipment costs of $30-50 per tonne higher than normal.

Thai Hua currently ships about 30,000 tonnes of rubber of a month. Thailand is the world’s biggest rubber producer and exporter, with about 200,000 tonnes of shipments a month. Transport by rail is estimated at 10,000 tonnes a month.