According to a Japanese industry association, the operating rate of the country's ethylene plants hit a record low in April, primarily due to disruptions in the supply of naphtha—a petroleum-derived raw material—stemming from conflict in the Middle East.
Ethylene is a basic chemical widely used in the production of detergents, pharmaceuticals, paints, and many other industrial products. The shortage of naphtha, a byproduct of crude oil refining, has forced many plants to reduce capacity or temporarily halt operations.
The data shows that the average operating rate of ethylene plants in Japan in April reached an unprecedented low, reflecting the negative impact of unstable geopolitical conditions in the Middle East on the supply chain of raw materials for the country's petrochemical industry.
Analysts say that if the disruption continues, Japan's ethylene supply may remain tight, putting pressure on production costs for consumer and industrial goods domestically.
