SCC halts Rayong olefins plant as Iran war disrupts feedstock supply chain via Strait of Hormuz
SCC has temporarily stopped operations at its Rayong Olefins subsidiary after Middle East tensions linked to the Iran war disrupted shipments of key feedstocks such as naphtha and propane, prompting a force majeure declaration.
Siam Cement Public Company Limited (SCC) has informed the Stock Exchange of Thailand that it has temporarily halted operations at the olefins plant operated by Rayong Olefins Company Limited (ROC), a subsidiary under its chemicals business, after geopolitical tensions linked to the Iran war—particularly around the Strait of Hormuz—disrupted the supply chain for key production feedstocks.
In a letter dated March 10, 2026, signed by Thammasak Sethaudom, President and Chief Executive Officer of Siam Cement Group (SCG), the company said heightened tensions in the Strait of Hormuz, a critical global route for oil and natural gas shipments, have constrained supply chains and limited the procurement of essential raw materials for its olefins operations.
The impacted feedstocks include naphtha and propane, both crucial for the olefins production process. SCG said its assessment indicates continued uncertainty and a risk of prolonged disruption, with some materials unable to reach their destination as planned.
As a result, SCC said it has been forced to suspend ROC’s operations temporarily. Rayong Olefins has also declared force majeure to trading partners and customers under the relevant contractual provisions.
SCC estimated the shutdown would add costs of about 150 million baht per month. However, it said ROC is a highly efficient facility that uses automation and digitalisation, enabling it to manage costs to some extent.
The company said its chemicals business will continue to closely monitor developments and adjust operating plans in response to ongoing uncertainty, with due regard for customers and all stakeholders.
SCC added that aside from the temporary halt at ROC, other plants within its chemicals business—as well as SCC’s other business lines—continue to operate as normal, with adjustments made where appropriate to reflect prevailing conditions.
On its financial position, the company said SCG remains strong and has sufficient cash on hand to withstand a prolonged situation. In 2025, SCG recorded total adjusted EBITDA of 55.012 billion baht, with around 4 billion baht contributed by the chemicals business.
SCC said the ROC shutdown is temporary and is not expected to materially affect the group’s overall operations. It said it will update the Stock Exchange of Thailand and relevant stakeholders should there be any significant developments.
