Why Are Plastic Prices Rising? Understanding the Impact of the Iran Conflict on Raw Materials

Over the past month, many businesses across manufacturing have started to observe plastic material prices rising, lead times increasing and supply becoming less predictable.

As we are sure you are already aware, one of the key drivers behind this is the ongoing conflict in Iran. While it might seem far removed from day-to-day manufacturing in the UK, it’s having a very real impact on the global plastics supply chain.

In this blog, the Amey Plastics team explain what’s happening, why it matters and what it means for businesses using plastic components.

It Starts with Oil and Petrochemicals

Most plastics begin life as petrochemicals, which are derived from oil and gas. Materials like polyethylene (PE), polypropylene (PP), and polystyrene (PS), all commonly used in injection moulding, are produced using key building blocks such as naphtha, ethylene, and propylene.

A large proportion of these raw materials pass through the Strait of Hormuz, the major global shipping route located near Iran. Around 20% of the world’s oil and a significant share of petrochemicals move through this narrow passage.

With the current conflict disrupting this route, supply has been severely affected.

Why Prices Are Increasing

When supply is disrupted and demand remains high, prices rise and that’s exactly what we’re seeing.

Key raw materials have already seen significant increases:

• Naphtha prices have risen dramatically (in some regions by over 50%)

• Polyethylene (PE) and polypropylene (PP) have increased by around 30–60% in some markets

• Feedstocks used for engineering plastics, such as styrene, are also rising sharply

  
  

Because these materials sit at the very start of the plastics supply chain, the cost increases are passed down step by step, eventually reaching manufacturers and their customers.

Supply Chain Disruption: The Bigger Challenge

While price increases are important, the bigger issue is often availability.

The disruption to the Strait of Hormuz has led to:

• Shipping delays, with vessels being rerouted around Africa

• Longer transit times, often adding 10–14 days or more

• Increased freight costs and insurance premiums

• Reduced production from major petrochemical plants due to lack of feedstock

  
  

Some suppliers have even declared force majeure, meaning they are unable to fulfil contractual supply obligations.

In practical terms, this means materials are not just more expensive, but they are also harder to secure.

Why Injection Moulding Is Particularly Affected

Injection moulding relies heavily on materials like PP, PE, ABS, and polystyrene, all of which depend on the feedstocks currently being disrupted.

This creates a direct impact on moulding operations:

• Rising material costs

• Longer lead times for resin supply

• Increased pressure on production planning

• Greater risk of material shortages for certain grades

  
  

For UK manufacturers, the situation is amplified by the fact that much of our raw material supply is imported, making us more exposed to global disruptions.

What This Means for Your Projects

For customers, these global changes can translate into:

• Material price increases on new and existing projects

• Longer lead times, particularly for certain polymers

• Less flexibility when it comes to switching materials or sourcing alternatives

  
  

While these changes are driven by global factors outside of any one company’s control, understanding the cause helps explain why they are happening and why they may continue in the short to medium term.

How the Industry Is Responding

Across the plastics sector, manufacturers are taking practical steps to manage the situation:

• Securing material supply earlier where possible

• Holding slightly higher levels of stock to reduce risk

• Exploring alternative suppliers or material grades

• Increasing use of recycled materials where appropriate

  
  

At Amey Plastics, it goes without saying that we are closely monitoring the situation and working with our suppliers to maintain continuity of supply, while keeping our customers informed of any changes that may affect projects.

Looking Ahead

While it’s difficult to predict how long the current disruption will last, one thing is clear: the plastics supply chain is highly global and events in one region can quickly affect manufacturers worldwide.

For now, businesses should expect:

• Continued volatility in material pricing

• Ongoing pressure on supply and lead times

• The need for proactive planning on new and existing projects

Keeping You Informed

We understand that stability, transparency and reliability are critical when planning production. Our aim is always to keep you informed and supported, particularly during periods of global uncertainty.

If you have any questions about material availability, pricing or your current projects, our team is always happy to help.