China’s Samsung chip production disrupted by Korea truckers’ strike – Trade Association

SEOUL, June 14 (Reuters) – Chip production at Samsung Electronics Co Ltd (005930.KS) in China is disrupted by a truckers’ strike in South Korea that is blocking exports of a key material, the Association said. Korea International Trade Association (KITA) Tuesday.

This is the first concrete sign that the week-long strike is impacting chip production, having already cost South Korean industrial sectors more than $1.2 billion in lost production and unfulfilled deliveries. Read more

KITA said a Korean company that produces isopropyl alcohol (IPA), a raw material for cleaning chip wafers, is facing complications when shipping to a Chinese company which, in turn, supplies wafers to a Samsung Electronics factory in China.

Join now for FREE unlimited access to Reuters.com

Register

KITA said in a statement that about 90 tons, or a week’s worth of shipments, had been delayed.

Samsung Electronics did not immediately comment. It produces NAND flash memory chips, used for data storage in data centers, smartphones and other tech gadgets, at its factory in Xian, China.

The Truckers’ Union said in a statement on Tuesday that it would continue its general strike and condemned the Department of Transport for being “neither willing to talk nor able to resolve the current situation”.

The union is protesting against soaring fuel prices and demanding minimum wage guarantees. Four rounds of negotiations with the government failed to find a compromise.

Samsung’s Xian factory had seen production halted earlier this year due to COVID-19 restrictions in the Chinese city, prompting a global firming in NAND prices. Read more

The tech giant has two production lines in Xian that manufacture advanced NAND flash products, which account for about 43 percent of its total NAND flash memory production capacity and 15 percent of the overall global production capacity, according to TrendForce.

Join now for FREE unlimited access to Reuters.com

Register

Reporting by Byungwood Kim and Joyce Lee; Editing Kenneth Maxwell and Stephen Coates

Our standards: The Thomson Reuters Trust Principles.

Andrew B. Reiter