Middle East war disrupts Thailand’s petrochemical supply, causing raw material shortages, production halts, and rising packaging and energy costs.
The ongoing conflict in the Middle East has created significant disruptions for Thailand’s industrial sector, particularly affecting the supply of petrochemical feedstocks. Companies across the country are now facing challenges in maintaining production due to shortages of essential raw materials, forcing some operations to temporarily halt.
TOA Paint (Thailand) Public Company Limited (TOA) reported that its raw material inventory could only sustain production for 20 days. Jatuphat Tangkaravakoon, TOA’s CEO, stated that the fighting in the Middle East, which has impacted upstream petrochemical producers, is expected to negatively influence the company’s first-quarter performance in 2026. TOA’s products rely heavily on petrochemical by-products, many of which have become scarce. The company is monitoring supply levels daily to assess whether production can meet demand in the near term. Titanium dioxide, a critical raw material, is among the most affected, and margins remain volatile as the company has avoided hedging its foreign exchange exposure. Despite these challenges, TOA has increased its 2026 investment budget to THB750 million from THB658 million last year, with plans to expand production capacity, upgrade facilities in Vietnam and Laos, and enhance research and development capabilities.
Thai President Foods Public Company Limited (Mama), known for its instant noodles, also faces supply constraints. The company requires plastic resin to produce packaging film, which is now becoming scarce due to rising oil prices driven by the conflict involving the United States, Israel, and Iran. Pun Paniangvait, Mama’s general manager, explained that suppliers have temporarily stopped fulfilling orders, forcing the company to prioritize packaging for best-selling products like tom yum shrimp and minced pork. While short-term cost increases for packaging can be absorbed, a prolonged shortage could prevent production even if other ingredients like flour and palm oil are available.
Other Thai manufacturers are experiencing similar difficulties. Srichand, a beauty products producer, noted that higher energy prices are pushing up packaging costs, though contracts with PTT Public Company Limited provide some temporary protection.
SCG has temporarily suspended operations at its Rayong Olefins Company Limited (ROC) plant due to shortages of critical feedstocks such as naphtha and propane, caused by disruptions at the Strait of Hormuz. This shutdown, while resulting in an estimated additional cost of THB150 million per month, does not significantly affect SCG’s overall operations. The company continues to monitor the situation and adjust plans as necessary, maintaining sufficient liquidity to handle prolonged supply chain uncertainties.
Overall, the Middle East conflict has exposed vulnerabilities in Thailand’s petrochemical and manufacturing supply chains. Companies are taking proactive steps to manage limited resources, prioritize critical production lines, and absorb short-term cost increases while closely monitoring global developments that could impact raw material availability.
