STRAIT OF HORMUZ TRADE DISRUPTION: IMPACTS ON MALAYSIA’S FOOD PACKAGING SUPPLY CHAIN

Abstract

This study examines whether the March 2026 geopolitical disruption associated with the reported closure and severe restriction of commercial transit through the Strait of Hormuz affected the Malaysia’s food packaging related supply chain. Using 37 monthly observations from July 2023 to July 2026, the study estimates two sequential bivariate OLS models: Brent crude oil price with Malaysia’s index of plastic manufacture, and the index of plastic manufacture with the food-product Producer Price Index (PPI). The conceptual framework combines the Ripple Effect Model, which specifies the proposed upstream-to-downstream propagation sequence, with the Exposure–Transmission–Buffering (ETB) framework, which is used to interpret vulnerability and buffering mechanisms. Empirical estimation confirms a positive, statistically significant relationship at upstream level while downstream estimation reveals a delayed transmission pattern, where model variance reflects broader macroeconomic structural dynamics rather than immediate cost absorption. An exploratory cross-correlation lag analysis further provides empirical proof of a two-month operational buffering window within Malaysia’s food packaging supply chain, but this is treated as descriptive evidence rather than a proven causal delay. The study also deals with food-contact risks related to chemical migration, contamination, material suitability and traceability. The results imply that supplier diversification, food-grade compliance, certified recycling capacity, and delayed-shock scenario planning should be considered. However, it is important to note that more time-series tests and supply-chain data are needed for more robust causal and firm-level conclusions.