‘Plastic shock’ hits Asia as Iran oil crisis strangles supplies

{"text":[[{"start":13.2,"text":"Asia is in the grip of a plastic crisis, with manufacturers across the region warning of shortages as the Iran oil shock hits supplies of packaging for food, medical aid and other consumer products."}],[{"start":25.6,"text":"The disruption of oil shipments from the Middle East has severely constrained supplies of naphtha, a petroleum product that is turned into speciality chemicals used in semiconductor manufacturing but is also essential to making plastic. The price of naphtha in Asia has almost doubled since the war began. "}],[{"start":43.5,"text":"That has sent the prices of bags, containers, cups and utensils soaring, sparking fears of shortages as manufacturers struggle to source packaging for products such as instant noodles, beverages and cosmetics. "}],[{"start":57.35,"text":"In Indonesia, one of the world’s most populous countries and one of the largest consumers of plastic, suppliers have warned plastics retailers that they could be forced to cease production due to scarcity of naphtha. "}],[{"start":70.05,"text":"“Sourcing supplies is impossible because the stock is limited,” said Arif, a worker at Toko Durga Plastik, which sells packaging material in the capital, Jakarta. "}],[{"start":79.7,"text":"Daily sales have dropped by almost half to Rp3.5mn ($201) over the past month and a sign at the entrance warns customers of “skyrocketing” prices."}],[{"start":null,"text":"

"}],[{"start":90.7,"text":"The “plastic shock” underscores the far-reaching impact of the war in Iran, which has strangled traffic through the Strait of Hormuz and sparked a global energy crisis. "}],[{"start":100.8,"text":"Increasing plastic prices could add to inflationary pressures across Asia, where many countries rely on imported energy and were already grappling with higher costs."}],[{"start":111.5,"text":"Indonesia imports almost all of its naphtha, mainly from the Middle East. Japan sources 44 per cent of its naphtha and more than 90 per cent of crude oil supply from the region. "}],[{"start":121.95,"text":"Some Asian petrochemical plants, which use naphtha to make ethylene and propylene, the building blocks of plastic, have already reduced or halted production. "}],[{"start":131.4,"text":"Indonesia’s Chandra Asri temporarily declared force majeure over difficulties sourcing naphtha, while Japan’s Mitsubishi Chemical and Mitsui Chemicals have cut output. Taiwan’s Formosa Petrochemical also declared force majeure."}],[{"start":146.75,"text":"Japanese producers of ethylene — used for food wrapping — have already cut output, with operating rates at 68.6 per cent, the lowest level on record, according to the Japan Petrochemical Industry Association. "}],[{"start":159.75,"text":"Ariana Susanti, business development director at the Indonesian Packaging Federation, said the food and beverage industry would be hit particularly hard. The food and beverage sector accounts for 60 per cent of plastic packaging demand in the country. "}],[{"start":175.05,"text":"“But cosmetics, medical equipment and pharmaceuticals are also affected,” she added."}],[{"start":180.10000000000002,"text":"Jakarta last week scrapped import duties on materials used to make plastic packaging, including polypropylene and high-density polyethylene. The move would also help ease price increases on packaged food and drinks, said economic affairs minister Airlangga Hartarto — a concern in a country struggling with declining consumer spending."}],[{"start":199.35000000000002,"text":"Some Asian economies are also encouraging use of paper packaging, or attempting to source naphtha from other countries, with Indonesia trying to source from India, Africa and the Americas. "}],[{"start":211.10000000000002,"text":"Japanese Prime Minister Sanae Takaichi said this week that the country had sufficient supplies of naphtha and stocks of plastic products to meet demand until the end of the year. "}],[{"start":223.05,"text":"But concerns are rising among Japanese businesses about supply and experts have warned of widespread disruption as soon as this month."}],[{"start":231.45000000000002,"text":"A survey of 102 companies by the National Federation of Living and Welfare Organisations, a trade body for consumer goods producers, found that 44 per cent of Japanese foodmakers had already been affected by plastic availability, price rises and delivery delays."}],[{"start":249.10000000000002,"text":"A major manufacturer of natto, Japan’s beloved sticky fermented beans, and a gyoza restaurant chain have suspended sales of certain products due to plastic supply issues. "}],[{"start":259.75,"text":"In South Korea, supplies of medical products such as syringes and intravenous fluid packs are also under pressure because of panic buying and a shortage of plastic packaging. "}],[{"start":269.3,"text":"On April 29, a survey by the South Korean Ministry of Food and Drug Safety showed a total national stock of 45.59mn syringes, slightly down from 46.46mn the week before. "}],[{"start":284.25,"text":"“Large hospitals are holding out thanks to long-term contracts, but clinics have low stock levels and supply is being delayed due to shortages in the internet and wholesale markets,” said the director of a midsized hospital in southern Seoul."}],[{"start":299.55,"text":"In Jakarta, Toko Durga Plastik’s Arif warned the situation might get worse. Suppliers cautioned that they had only enough raw material to maintain production through to the end of this month. “After May, I don’t know if there will be any stock,” Arif said."}],[{"start":322.1,"text":""}]],"url":"https://audio.ftcn.net.cn/album/a_1778134036_9979.mp3"}