ไทย
Krungthai COMPASS Research Center estimates that the Middle East conflict is creating cost-push pressure from rising fertilizer and oil prices, inevitably impacting the production costs of the Thai food industry. Four food products are highly affected: bread/baked goods, snacks, instant noodles, and soybean oil. Krungthai COMPASS states that the Middle East conflict and the closure of the Strait of Hormuz in late February 2026 have escalated the risk to the global food chain from an “energy shock” to a “food cost shock.” This is because the Persian Gulf is a major exporter of chemical fertilizers, oil, and natural gas. If the unrest persists, it will push up the prices of key agricultural inputs like chemical fertilizers, leading to higher cultivation costs and higher global prices for grains such as soybeans, corn, and wheat. Furthermore, increased energy and transportation costs driven by rising oil prices will inevitably create a ripple effect, putting pressure on the midstream and downstream food industries.
War is creating a cost-push for the Thai food business through rising fertilizer and fuel prices.
The Middle East crisis is more of a “slow-burning food crisis” than a sudden food supply shock, as it will gradually build up and intensify over the long term through rising energy and fertilizer costs. This is reflected in the average prices of soybeans, corn, and wheat during March-April 2026, which rose only 5.4%, 3.0%, and 9.9% respectively above pre-war levels, compared to the Russo-Ukraine war which directly impacted global food supply and pushed prices of these grains up by 18.5%, 27.3%, and 50.2% respectively during February-December 2022 from pre-war levels.
However, the risks to watch are the prices of fertilizers and oil, which have increased at a higher rate during the Middle East conflict than during the Russia-Ukraine conflict. Even though fertilizer and oil prices are expected to decrease somewhat in the second half of 2026, they will still remain at high levels, which will put pressure on cultivation costs and consequently on the cost of agricultural raw materials. Meanwhile, rising global oil prices will also increase transportation and logistics costs.
The cost impact of war on the Thai food industry.
For Thailand, a worrying pressure that has a wide-ranging impact on businesses is the cost-push effect from rising fertilizer and energy prices. This will be passed on to the Thai food industry through two main channels:
- Rising import raw material costs: If global fertilizer prices increase, it will boost the cost of cultivating soybeans, corn, and wheat worldwide, impacting Thai food businesses that heavily rely on imported raw materials. However, while domestic raw materials may be affected by higher fertilizer costs, food products that depend on imports will face additional pressure from increased shipping costs and longer transit times. Therefore, this analysis focuses primarily on assessing the impact of imported raw material costs.
- Increased energy and transportation costs: Production processes such as boiling, sterilization, drying, chilling, and freezing require electricity and fuels such as diesel and natural gas. Rising oil prices impact domestic transportation costs, putting pressure on businesses’ production costs.
Krungthai COMPASS estimates that four food products will be highly affected: bread/baked goods, snacks, instant noodles, and soybean oil. This is because these products rely heavily on imported soybeans, corn, and wheat, and have high energy and transportation costs, accounting for approximately 77.2-82.7% of their total production costs. Considering the ability of the aforementioned food products to be passed on to consumers, it was found that a 1% increase in cost allows for a price increase ranging from 0.08% to 0.32%. Snacks, however, can pass on the least cost to consumers, at only 0.08%, due to intense competition and the easy availability of substitutes, limiting the amount of cost passed on.
Furthermore, the food business faces downside risk from persistently high plastic packaging costs. The Thai food industry experienced a significant increase in plastic packaging costs in Q2/2026 due to the impact of the Middle East conflict, affecting naphtha imports, a key raw material for plastic production. This forced some manufacturers to temporarily reduce production capacity. Although the situation has eased, with transportation recovering and plastic resin imports increasing by over 39% in May 2026, ensuring sufficient supply for domestic demand, the high price continues to cause some packaging manufacturers to delay production. With the food and beverage industry using 53% plastic packaging, this puts pressure on the production and costs of Thai food and beverages. However, this analysis does not assess the risk of packaging shortages, as the impact will depend on the stock levels and raw material management of each manufacturer.
Food businesses can adapt to reduce cost vulnerability through three key approaches:
- Supply Chain Relocation involves diversifying raw material sources, reducing dependence on any single country or region, and adjusting production formulas to use more domestically sourced raw materials.
- AI adoption and digital cold chain technologies to help maintain product quality, reduce contamination risks, and extend the shelf life of fresh and chilled food products.
- Green & Energy Transition : Investing in energy-efficient production technologies and alternative energy sources such as Heat Optimization and Recovery and Biogas to enhance long-term sustainability.
Read more at: https://www.infoquest.co.th/2026/612834