(Source): The Iran war has driven up plastic packaging costs; Japanese food prices will rise this summer

Bai Jie Net News: Japan’s business research organization Teikoku Databank released a report stating that, due to a shortage of naphtha—a key raw material used for plastic packaging—caused by the Iran war, Japanese food and beverage prices are expected to begin rising as early as this summer. Energy flows through the Strait of Hormuz have long been disrupted, reducing naphtha supply and prompting packaging suppliers producing polypropylene and polyethylene from this petrochemical feedstock to demand immediate price increases. Small and medium-sized food manufacturers have already begun to feel the impact.

The report covers food and beverage categories that have seen or are expected to see price increases by September, including candy products such as chocolate, which are expected to be most significantly affected by the price hikes. In March, Japan’s core consumer prices (excluding fresh food) rose 1.8% year on year, exceeding economists’ median expectations, and as well as being higher than the previous month’s 1.6% increase. Excluding fresh food and energy, the index rose 2.4%, staying continuously above the 2% target.