Could there be a more screwed up economy?

Packaging assn warns of steel shortage risk - Venezuela
Tuesday, February 12, 2008

Venezuela's packaging industry association Cavenvase has expressed concern about a possible shortage of raw materials needed to produce metallic packaging because of labor conflicts at steelmaker Ternium Sidor.

"We are worried that if [the employees] go on an indefinite strike, it could affect the supply of tin plate in the short term which would end up affecting shipments to our clients," Cavenvase president Mauricio Caycedo told BNamericas.

If the steelmaker's operations are halted, the strike would harm 90% of metal packaging producers, Caycedo said, adding that recent partial stoppages at Ternium Sidor have not impacted companies in the trade.

Regardless, the executive called on the government, company and employees to choose dialogue over stoppage, "because a strike at a company like Sidor is detrimental to the regional economy," he said.

He added that, aside from packaging companies, the entire downstream economy including sectors like construction, oil and auto parts would be affected in the midterm.

Ternium Sidor supplies 100% of the raw materials used by metal packaging producers in Venezuela.

Recently, Venezuelan regional metalmechanics industry association Comec also expressed concern that pressure tactics being used by labor union Sutiss at Ternium Sidor could affect the supply of raw materials to the country's small and midsize manufacturing companies.

Cavenvase is made up of companies in the bottling and packaging sector that use a variety of materials. The aim of the association is to study national and international markets for new ways of manufacturing, developing and improving quality and design.

Harvey Beltrán
Business News Americas