Market Update

Geopolitical Situation in the Middle East: Continued Impact on the Polypropylene Value Chain

Overview
Following our earlier communication on 6 March, the geopolitical developments in the Middle East — including the escalation of conflict involving Iran — are continuing to affect global energy and petrochemical markets. In recent days, what began as short‑term volatility has evolved into a more structural disruption across the polypropylene (PP) value chain.

At Beaulieu Fibres, we are actively managing the situation and working closely with our supply partners to safeguard continuity for our customers.

Key Market Developments

• Upstream Supply Constraints: The disruption in the region is now affecting upstream availability of propylene (C3) and PP polymers. Although supply flows remain active, the market has shifted into a structurally tighter environment, increasing pressure on raw material costs.
• Energy Costs: Energy prices are expected to remain elevated. This increase in electricity and gas costs is putting additional strain on production across the industry.
• Cost Impact on April Deliveries: To secure upstream volumes and maintain supply commitments, an exceptional market surcharge will be applied on top of the ICIS PP reference index for April deliveries. This measure may be extended or adjusted depending on how the situation evolves.

Working Together to Maintain Supply
Securing raw materials in this environment requires early visibility. We therefore encourage customers to reach out to review their demand for April and the second quarter, enabling us to prioritize planning and allocate volumes efficiently.

Despite the challenging conditions, our commitment remains unchanged: to support our customers reliably, transparently, and with continued supply where possible.

For further information, please contact your Beaulieu Fibres representative.