Middle East Conflict Disrupts Australia's Chemical Industry

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Researched by IIR News Intelligence (Sugar Land, Texas)--Australia's chemical industry is experiencing widespread disruptions due to the conflict in the Middle East. The nation's chemical building blocks supply chain is severely hampered as a result of feedstock shortages and blocked shipping in the Strait of Hormuz.

Australia lost its sole polyethylene manufacturer in 2024, leaving its entire plastic supply chain exposed to the global crisis. When Qenos entered voluntary administration due to high natural gas feedstock prices, Australia had to rely solely on imported virgin resin. Resins were sourced from the Middle East, and the closure of the Strait of Hormuz has blocked those shipments. For more on Qenos, see June 10, 2024, article - Australia's Qenos to Close Petrochemical Plant.

Force majeure declarations have impacted the fertilizer sector. More than 60% of Australia's urea is imported from the Persian Gulf for the production of nitrogen-based fertilizers. CSBP Fertilisers and Summit Fertilizers have invoked force majeure, citing supply failures. The Australian government has taken emergency measures to manage imports and alternative supply routes to prevent a total collapse of the industry supply chain.

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