BANGKOK, Thailand – Major petrochemical producers in Thailand, the world’s eighth-largest petrochemical hub, have begun notifying customers of production cuts and price hikes as the closure of the Strait of Hormuz disrupts global feedstock supplies.
SCG Chemicals (SCGC) announced it has declared force majeure at its Rayong Olefins (ROC) plant. Thammasak Sethaudom, President of SCG, stated that regional instability has prevented the timely delivery of essential feedstocks, specifically naphtha and propane.
The ROC shutdown is expected to cost approximately 150 million baht per month. SCG is pivoting toward alternative energy sources for its cement and construction units to mitigate oil price volatility.
Other major industrial players within the Map Ta Phut Industrial Estate, which boasts an annual capacity of 37 million tons, are also bracing for significant operational impacts. PTT Global Chemical (GC) has warned customers of heightened uncertainties regarding logistics and feedstock, prompting the company to manage orders strictly based on current supply availability. Meanwhile, Dow Chemical Thailand announced an immediate price increase of $200 per ton for its specialty resin products, citing unmanageable external costs driven by rising geopolitical tensions in the Middle East.
To mitigate supply chain risks, IRPC is actively seeking crude oil from alternative sources to bypass its reliance on Middle Eastern routes. At the same time, HMC Polymers reported that rising maritime insurance premiums and freight delays are creating severe constraints. The company warned of potential shortages in Polypropylene (PP) deliveries in the coming weeks as it adjusts production cycles to match the volatile arrival of raw materials.
The disruption is expected to ripple through Thai SME supply chains, affecting sectors from food packaging and automotive parts to medical supplies and textiles. (TNA)
