Middle East conflict spreads to Europe, Indorama declares force majeure on two PET units.

Recently, due to widespread disruptions in raw materials, energy, and supply chains caused by the Middle East conflict, Indorama announced that force majeure has been declared at its two polyethylene terephthalate (PET) plants located in Klaipėda, Lithuania, and Włocławek, Poland.

According to data from S&P Global Energy, the annual PET production capacity of the Lithuanian plant is 263,000 tons, while the Polish plant has an annual capacity of 203,000 tons. The company stated that, in addition to the supply chain impact from geopolitical conflicts, unexpected production disruptions occurred before the force majeure declaration. The related effects are expected to last until March-April, with future supply facing uncertainty.

Although Europe's imports of PET from the Middle East are limited, the Middle East conflict has still significantly impacted the European PET industry. Amid substantial fluctuations in upstream raw material and energy costs, producers are attempting to raise prices to transfer cost pressures. However, downstream buyers are largely adopting a wait-and-see attitude, generally believing that the current tight situation is only short-term and showing low acceptance of price increases.