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Colombian Truckers, Government in Talks to End Strike

Source: Reuters
14/08/2008

Bogota, Aug 13 - Colombian truck drivers and government officials held talks on Wednesday to try to end a two-week-old protest that has disrupted food supplies and slowed coffee exports from the world's No. 3 producer.

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The Colombian Truck Drivers Association wants to guarantee clients pay fair freight costs, among other demands, but the private sector says the freight payment scheme does not reflect market conditions, with so many trucks offering services.

Government officials and truckers met with a senate commission on Tuesday but reached no deal to bring the strike to an end. Negotiations in a senate commission continued on Wednesday, even as truckers vowed to keep up their protest.

"Hopefully, today we can advance from yesterday's meeting to identify points we can solve in the short term, and those we should leave for the medium term," Sen. Plinio Olano told local RCN radio.

"We just need a little willingness ... both sides have been summoned again," he said.

Truck association director Jorge Garcia said the strike would be "indefinite" until demands were met, including freight costs and assistance replacing old vehicles.

Colombia's National Federation of Coffee Growers, which accounts for 30 percent of the country's coffee exports, says inventories are helping it meet obligations, but those supplies are reaching limits.

The federation says coffee shipments from the country's key Buenaventura port are effectively suspended, though exports from the Caribbean ports are normal. The group said on Tuesday it had 280,000 60-kg bags halted by the strike.

Private exporters, who provide 70 percent of coffee exports, also say inventories are running thin.

Both the federation and the private Association of Colombian Coffee Exporters have warned that the strike could soon have a dramatic effect on exports, if not resolved.

Arabica coffee futures trading on ICE fell more than 3 percent on Wednesday, as the U.S. dollar rallied against the euro amid expectations that economic growth in Europe and Asia may slow at a sharper rate than in the United States.

The two-week-old truckers' strike in Colombia kept producers on the sidelines, providing a bullish undertone to the market, but this fundamental factor was pushed aside as the dollar climbed, traders said.

The strong greenback makes dollar-traded commodities like coffee more expensive to investors holding other currencies.

ICE's benchmark December arabica contract was down 2.80 cents, or 2.8 percent, at $1.3855 per lb, by 11:30 a.m. EDT (1530 GMT). The session low hit at $1.3685, a nearly 4-week low for the second position.



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