Shiseido (TYO:4911) is considering replacing oil-derived materials with plant-based alternatives as disruptions linked to the Middle East conflict strain global supply chains for skincare and beauty products, Bloomberg reported Tuesday.
The company said shortages of petroleum-based naphtha could affect key ingredients used in moisturizers, makeup and other cosmetics. It is reviewing its supplier network and exploring alternative raw materials to reduce dependence on petrochemical inputs, according to the report.
CEO Kentaro Fujiwara said the company is preparing for adverse scenarios while adjusting operations, estimating a 5 billion yen impact on core operating profit this fiscal year due to higher input and logistics costs and weaker regional sales, the report said.
Despite these pressures, Shiseido reported first-quarter core operating profit of 13 billion yen, above analyst expectations, supported by cost controls and internal restructuring, according to the report.
The company also plans to shut its Hsinchu plant in Taiwan in the second half of 2027, a move expected to reduce fixed costs by about 1 billion yen annually.
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