Japan's naphtha shock may be entering a new phase, with signs that product shortages are gradually easing in some industries while concerns grow that higher transportation costs could drive up prices across the supply chain.
TOTO, the Kitakyushu-based housing equipment manufacturer, resumed full orders for unit baths and related products on June 9th after securing a stable outlook for raw material supplies that had been disrupted by the closure of the Strait of Hormuz and the resulting global shortage of naphtha.
A worsening naphtha shortage linked to tensions in the Middle East is beginning to affect everyday retailers in Japan, with some businesses replacing plastic packaging with newspaper and asking customers to bring their own containers and bags.
Japan's chemical industry is facing growing pressure from rising raw material costs and supply concerns linked to tensions in the Middle East, although expectations for industry restructuring and expanding demand for semiconductor materials are providing reasons for optimism.
Japan received its first crude oil shipments from Alaska and South Sudan on June 7th since the effective closure of the Strait of Hormuz, as the country steps up efforts to secure stable energy supplies and reduce its reliance on Middle Eastern oil.
Japan's agricultural sector, which supports the nation's food supply, is beginning to feel the impact of the Middle East crisis, as soaring fuel and fertilizer costs and growing shortages of essential farming materials raise fears that more producers may abandon the industry.
Japan is grappling with worsening shortages of naphtha-derived materials three months after the closure of the Strait of Hormuz, with Prime Minister Sanae Takaichi arguing that the country's problem is not a lack of supply but a breakdown in distribution, while opposition parties are urging the government to intervene against suspected hoarding and speculative stockpiling.
Former Mie Governor and Liberal Democratic Party Policy Research Council Special Adviser Eikei Suzuki has called for a stronger government role in Japan's energy policy, arguing that the country's heavy dependence on Middle Eastern oil is the result of decades of market-driven procurement and that rising energy prices now pose a greater threat than supply shortages.