Naphtha supply disruptions worsen as government and petrochemical industry vow to prioritize domestic supply

[The Financial News]
As disruptions in naphtha supply spread to petrochemical products, the government and the petrochemical industry pledged to make every effort to secure sufficient domestic supply.
On the 1st, the Ministry of Trade, Industry and Resources (MOTIR) held a meeting on stabilizing petrochemical supply and checking supply chains in the main conference room on the 11th floor of the Korea Trade Insurance Corporation (K-SURE). There, officials met with heads of major domestic petrochemical and chemical companies to review the current status of naphtha supply and petrochemical product distribution, and to discuss response measures.
The government announced that it plans to make every effort to secure a stable supply of naphtha. To ease the burden on companies introducing alternative naphtha, it has allocated 469.5 billion won in the latest supplementary budget to cover the price gap in imported naphtha. It will also actively pursue measures to maintain production and supply, including restrictions on naphtha exports and support for expanding domestic supply.
In addition, the government intends to take responsibility for managing the domestic supply of petrochemical products. It will closely oversee supplies of petrochemical products that are essential for healthcare, key industries, and everyday life. Authorities also plan to respond strictly to any market-disrupting distribution practices that fuel public anxiety.
Finally, an interagency supply chain response system will remain in constant operation. Through the Middle East War Supply Chain Support Center, established after the outbreak of war in the Middle East, the government is working with relevant ministries to comprehensively monitor raw material supplies, price trends, domestic production disruptions, and supply bottlenecks. If any warning signs are detected, it plans to swiftly implement necessary measures in coordination with the relevant ministries.
The government also called on the industry to do its utmost to expand production of petrochemical products and ensure stable domestic supply. Companies, in turn, pledged to make every effort to introduce alternative naphtha and to increase both production of petrochemical products and the volume supplied to the domestic market.
Vice Minister Mun Sin-hak stressed, "There are growing concerns about supply instability not only in key industries and on the ground, but also in many aspects of people’s daily lives. When it comes to protecting the national supply chain and safeguarding the everyday lives of our citizens, there can be no separation between the roles of government and business," adding, "We ask companies to make domestic supply their top priority and to focus all their capabilities on this task. The government, for its part, will spare no effort in taking necessary measures and providing support."

aber@fnnews.com Park Ji-young Reporter