Impact of US-Iran Tensions on POF Shrink Film & H2 2026 Market Outlook

The prolonged US-Iran tensions through late May have disrupted global energy and chemical supply chains, putting short-term pressure on the POF shrink film sector.

As key raw materials of POF and Crosslink shrink film, LLDPE and PP are petroleum derivatives. Geopolitical frictions pushed up crude oil prices, driving raw material costs higher. Rising freight and delayed logistics also squeezed profit margins of manufacturers, and market transactions remained cautious with buyers only placing rigid orders.

The market will stage a steady recovery in the second half of 2026. First, cost pressures will ease notably. With tensions easing after late May, crude oil will lose risk premiums, leading to a gradual drop in LLDPE and PP prices. Domestic coal-to-olefin capacity will further stabilize raw material costs, lifting manufacturers’ profit margins.

Second, downstream demand will pick up markedly. POF and Crosslink shrink film is widely used in food, beverage, daily chemicals and logistics. Peak consumption seasons from National Day to New Year’s holidays will boost order volumes. Meanwhile, eco-friendly POF will keep replacing PVC shrink film, expanding its market share. Demand for high-performance, thin-gauge and high-transparency POF products will also grow amid consumption upgrading.

Third, the industry will see accelerated structural optimization. Small and medium-sized players are phased out amid cost and environmental challenges, while leading enterprises will expand market shares relying on scale, supply chain advantages and R&D capabilities.

Overall, short-term geopolitical shocks will not reverse the industry’s upward trend. In H2 2026, the POF shrink film market will recover steadily with improving profits and a more concentrated industry landscape. Manufacturers are advised to monitor raw material prices, optimize inventory and develop high-end products to seize market opportunities.