- Home
- World
- Middle East Conflicts
Middle East Conflict Squeezes Thai Food Manufacturers as Costs Rise Faster Than Prices Can Follow
By: WNEWS247 Editorial Staff
Published: July 17, 2026
Updated: July 18, 2026
BANGKOK, THAILAND — Thailand’s food industry is absorbing a slow-building cost crisis driven by the Middle East conflict and disruption to Strait of Hormuz shipping routes — with manufacturers of instant noodles, bread, snacks and cooking oil facing the sharpest pressure and the least ability to pass costs on to consumers.
Middle East Conflict Squeezes Thai Food Manufacturers as Costs Rise Faster Than Prices Can Follow
Unlike the immediate supply shock of the Russia-Ukraine war, analysts describe the current situation as a slow-burning food crisis — one where rising fertilizer, energy and shipping costs gradually compress margins throughout the production chain rather than causing sudden shortages.
Why the Gulf conflict hits Thai food so hard
The Persian Gulf supplies a significant share of global chemical fertilizer exports alongside oil and natural gas. As conflict persists, fertilizer prices have already risen more sharply than during the Russia-Ukraine period, even though grain prices — soybeans up 5.4%, corn up 3.0%, wheat up 9.9% since the conflict began — remain well below the peaks seen in 2022, when wheat alone surged 50.2%.
The risk has shifted upstream. Higher fertilizer costs increase cultivation costs for soybeans, corn and wheat globally, feeding through to Thai manufacturers who depend on imported agricultural inputs. Rising oil prices simultaneously push up energy costs across food production — boiling, sterilization, drying, refrigeration, frying, grinding — and drive up diesel-dependent domestic distribution costs.
Four categories most exposed
Analysis of Thailand’s food sector identifies four product groups carrying the highest combined exposure to imported raw material costs, energy and logistics — together accounting for 77 to 82 percent of total production costs in each category:
Instant noodles rely heavily on imported wheat flour and soybean oil, with energy-intensive production processes and wide distribution networks dependent on diesel transport.
Bread and baked goods face similar wheat and energy exposure, with limited shelf life adding logistical pressure.
Snack foods combine high imported corn and soybean dependency with energy-intensive frying and processing.
Soybean cooking oil is directly exposed to global soybean prices, which are influenced by both fertilizer costs and shipping disruptions from Gulf routes.
