TAIPEI (Taiwan News) — Taiwanese businesspeople in Thailand are facing higher energy and raw material costs linked to fighting in the Middle East, CNA reported Tuesday.

The petrochemical industry was hit first, with raw material prices rising soon after the conflict began. Kuo Hsiu-min (郭修敏), who makes polyvinyl chloride products in Thailand, said some prices rose about 50% within weeks.

Thailand depends heavily on imported energy, leaving local businesses exposed to global price swings. Kuo said the sudden increase forced companies to buy materials early, while some firms could not fill orders because they lacked stock.

“Higher fuel, electricity, and transport costs have raised production costs,” said Kang Shu-te (康樹德), former chair of the Joint Foreign Chambers of Commerce in Thailand. He said companies with low stock may have to pay more to restock or face supply problems.

Food business owner Hsieh Wen-kuei (謝文桂) said suppliers have raised prices quickly, putting pressure on middle and downstream firms. He said plastic packaging costs have risen sharply, while Thailand’s weak economy makes it difficult for businesses to pass costs on to customers.

Construction contractor Chang Wei-pin (章維斌) said steel bars, cement, and steel structure materials have all become more expensive. He said some prices change every two days, so his company is buying only what it needs and slowing work progress.

Several Taiwanese businesspeople said uncertainty is the biggest challenge. “Geopolitical risks are harder to plan for than the COVID-19 pandemic because companies do not know when fighting will end or when energy prices will stabilize,” they said.

Kang said companies need to become more competitive to withstand repeated shocks. He said automation, AI, smart manufacturing, and worker training could help firms adapt.

Kuo said keeping backup inventory is also important during an energy crisis. She said her company had already increased orders from Taiwan suppliers and retained enough stock to reduce risk.