(Yicai) April 22 -- Chinese exhibitors at Chinaplas, the largest trade fair for the plastics and rubber industries, told Yicai that they have been getting more orders than they did even before the Middle East war broke out, despite rising raw material costs.

Orders at Kingfa Sci. & Tech., a leading supplier of modified plastic materials, have surpassed expectations, according to Deputy General Manager Guan Xunning. They rose by double digits in the first quarter from a year earlier thanks to the Guangzhou-based firm’s strong supply chain advantages, Guan said.

Demand for Covestro's engineering plastic remained strong in the first quarter despite surging raw material costs, said Wang Li, president of that part of the business. One of the Shanghai-based company’s advantages lies in its comprehensive global supply chain, which helps customers better navigate short-term uncertainties, she pointed out.

The Mideast turmoil has created tension across the industry, with drastically higher raw material costs and disrupted supply chains, leaving its businesses “not only worried about whether they can afford to buy, but also whether they can even buy,” Wang said. That has pushed clients to make supply security their top priority and continue placing new orders, even though this will drive up their inventory levels, she noted.

The situation in the Middle East presents both challenges and opportunities for businesses, said Andy Postlethwaite, senior vice president of BASF and head of the German chemical giant's Asia-Pacific performance materials division.

Most plastics value chains have been affected by high oil prices and are facing shortages of upstream raw materials, he said, so BASF plans to use the trade fair to communicate closely with Chinese customers to jointly manage the crisis and build more resilient and efficient supply chains.

This year's Chinaplas is being held at the National Exhibition and Convention Center in Shanghai from April 21 through 24, with more than 5,000 exhibitors participating.

Despite this difficult period, BASF has a very reliable supply chain and partners in China, which provide it with many opportunities to better support client needs, Postlethwaite said, adding that the firm's localization rate has reached about 96 percent, while continuing to increase investments in the region.

Despite the higher cost of raw materials and logistics, many of Syensqo’s specialty polymer products are hard to substitute and are used in relatively small volumes, said Guan Jian, sales director for China car clients at the Belgian chemicals and materials maker. The impact on the business remains limited for now, he said.

One of Syensqo's responses to competition and demand fluctuations is to keep pushing research, development, and manufacturing localization, while "further enhancing business development in China," Guan stressed.

Editors: Tang Shihua, Martin Kadiev