‘Plastic bag chaos’: Shortage fears highlight Taiwan’s energy security concerns

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TAIPEI – Taipei fruit seller Fang Yen-ming no longer separates his products when packing them for his customers.

Whether they are apples, pineapples or bananas, everything goes into a single plastic bag – a move that has led to his regulars grumbling about the fruits potentially bruising or spoiling faster.

“It’s not ideal, but plastic bags are a precious commodity now,” joked Mr Fang, who runs a fruit stall at a wet market in the city’s bustling Zhongshan district.

“I need to ration them as much as I can, or I may have to start charging my customers for the bags, which will cause even more unhappiness,” he said.

Taiwan is facing fears of a plastic bag shortage – which local media has dubbed “plastic bag chaos” – amid a significant price hike for plastic goods, driven primarily by surging oil prices and disruptions in the global petrochemical supply chain owing to the prolonged conflict in the Middle East.

Taiwan uses around nine billion plastic bags annually, according to 2023 government statistics.

As the US-Israeli strike on Iran disrupted global oil supply – crude oil is the primary raw material for plastics – the cost of three-litre plastic bags in Taiwan has more than doubled from NT$4 (16 Singapore cents) to nearly NT$10.

When this reporter visited plastics wholesalers in Taipei, several had put up signs indicating that prices of their goods have recently shot up by up to 40 per cent. Certain non-inventory items would also see their prices fluctuate according to daily rates, the signs read.

This comes as Taiwanese market vendors and small business owners have in recent weeks reported difficulties securing plastic bags from their usual suppliers. Online, social media users shared photographs of empty shelves in supermarkets across the island where plastic bags used to be stocked.

The situation is similar in neighbouring South Korea, where fears of a potential shortage of plastic products have triggered residents to hoard garbage bags and smaller restaurants to stockpile food-delivery containers.

In Taiwan, government officials acknowledged disruptions in the downstream availability of plastic products, and suggested that domestic scarcity may have been worsened by consumers panic buying as well as possible market speculation, with middlemen distributors deliberately withholding stock for future higher profits.

On March 26, Ministry of Economic Affairs officials told lawmakers that they would closely monitor the situation and crack down on any businesses illegally stockpiling plastic products.

In another legislative meeting on April 1, the ministry called on the public to purchase plastic goods “rationally”.

“If (plastic) shortages emerge, the government will reallocate supplies and aim to normalise supply within three days,” said Deputy Minister of Economic Affairs Ho Chin-tsang.

On the same day, the state-run CPC Corp restarted its fourth light oil cracking plant to boost the supply of ethylene, a petroleum derivative that is used for plastics and packaging production. The move is expected to increase ethylene supplies from the current 60,000 tonnes to 80,000 tonnes.

In any case, Taiwan’s plastic supply crisis has highlighted its extreme vulnerability to global energy disruptions and supply shocks, a situation that experts often refer to as the island’s “Achilles heel”.

Taiwan relies on imports for nearly 96 per cent of its energy needs, including more than 70 per cent of its crude oil from Middle East suppliers such as Saudi Arabia and Kuwait, and one-third of its liquefied natural gas from Qatar.

Professor Julien Chaisse, an international trade expert at City University of Hong Kong, told The Straits Times: “Taiwan is highly sensitive to energy supply disruptions because it is an import-dependent, manufacturing-intensive economy.

“Its resilience must go beyond fuel stockpiles to include diversified petrochemical sourcing and more domestic power sources that are less exposed to maritime choke points.”

As a global hub for semiconductor manufacturing, even minor energy or material supply chain disruptions can threaten Taiwan’s global tech dominance.

But the stakes are not merely economic: As Taiwan faces rising military threats from China, which claims sovereignty over the island, fears have grown that its high dependence on imported energy will leave it vulnerable in the event of a Chinese maritime blockade.

Ms Liz Joho, who conducted research on the topic at think-tank Taiwan Center for Security Studies, said: “In a region marked by rising tensions and uncertainty, energy security is tied directly to questions of national resilience, economic sovereignty and even defence.”

In March, Beijing offered to supply Taiwan with stable energy, including natural gas and electricity, as part of a campaign to convince the island of the benefits of “reunification”. Taipei rejected the offer as “cognitive warfare”, saying that it has secured alternative supplies for the months ahead, including from the US, the island’s main international backer.

Mr Ho from the Ministry of Economic Affairs said: “On energy, we in Taiwan have made preparations, we have safety reserves and response plans.”

For market vendors like Mr Fang, he can only hope that overall prices of plastic bags will soon stabilise.

“It’s something you don’t usually think about, but this everyday item will eat into the profits of small businesses if prices keep going higher,” he said. “I can absorb the extra costs for only so much longer.”