Emergency Introduction of Surcharge Pricing in Response to Surge in Raw Material Costs Amid Middle East Tensions and Strait of Hormuz Blockade

HZ Info,Tokyo, Japan, March 27, 2026 ¡ª Toray Industries, Inc., announced today that it will introduce surcharge pricing on certain products as an emergency measure to address skyrocketing costs for crude oil, naphtha, and other raw materials driven by escalating tensions in the Middle East¡ªparticularly the military conflict involving Iran and the de facto blockade of the Strait of Hormuz.

The surcharges will primarily apply to products directly affected by price fluctuations for petrochemical feedstock such as crude oil and naphtha. Directly affected products include performance chemicals, carbon fiber composite materials, and fibers and textiles. Specific details¡ªincluding applicable products and conditions¡ªwill be discussed individually with customers by the relevant business divisions, with the policy of moving forward with mutual understanding.

Given the urgency of this measure, surcharges have already been applied to some products and will be added to other products going forward. Toray will review the surcharges at regular intervals in light of market conditions and trends in raw material prices.

This pricing mechanism is not a permanent price revision, but a temporary emergency measure designed to respond swiftly to rapid changes in the external environment.

The global economy is facing new risk factors stemming from the deteriorating situation in the Middle East, which began with U.S.-Israeli strikes on Iran on February 28 this year. These risk factors include soaring costs for raw materials, fuel, and logistics due to the Strait of Hormuz blockade, as well as disruptions to raw material sourcing. Combined with continued stagnation in the Chinese economy and a highly unpredictable U.S. tariff policy, the global economic outlook is becoming increasingly uncertain.

Against this backdrop, crude oil prices have surged so dramatically that the Japanese media has described the situation as historically severe, calling it the ¡°third great oil crisis.¡± Under the circumstances, Toray recognizes that it will be difficult to maintain stable production if it continues to make pricing decisions at the conventional pace, employing only internal efforts to absorb the rising costs.

The current situation requires faster management decision-making. Toray recognizes that, to continue growing, it must expedite initiatives such as supply chain restructuring, new market development, and technology investment, employing flexible strategies that can respond swiftly to changes in the business environment.

Toray views the introduction of this new pricing approach as part of its broader efforts to navigate current global challenges, as it will streamline price negotiations with customers and accelerate decision-making across the supply chain.

Although procurement concerns are emerging for some raw materials, Toray will continue to make every effort to ensure a stable supply.

Toray has long aspired to be more than just a materials manufacturer, seeking to create and deliver value across the entire supply chain. Going forward, the company will continue to monitor geopolitical risks and energy market trends closely. Meanwhile, it will strengthen its medium- to long-term competitiveness by diversifying procurement sources, increasing production efficiency, and reducing environmental impact, thereby contributing to the sustainable development of society and industry.