Middle East Tensions Deepen Manufacturing Risks: 91% of SMEs Feel Impact, Facing Soaring Raw Material Costs, Procurement Difficulties, and Inability to Produce Despite Orders

NC Network Co., Ltd. (HQ: Taito-ku, Tokyo; President: Yasuo Uchihara), operator of the manufacturing business matching platform "Emidas," conducted a survey on the "Impact of Middle East Tensions on the Manufacturing Industry and Business Sentiment" targeting SME executives who are members of "Emidas." The web-based survey was conducted from April 7 to April 17, 2026, with approximately 150 responses. The results showed that 91.1% of companies responded that the Middle East situation "has an impact" or "has a slight impact" on their overall business, indicating that many SME manufacturers are feeling the effects on their operations. Click here for detailed survey results. ○ Soaring Electricity and Raw Material Prices Squeeze Operations The most significant impacts are from rising prices of electricity, fuel, and raw materials, with over 80% of companies answering it "has an impact" or "has a slight impact." In addition to price hikes for aluminum, resin, and steel (stainless steel, brass, etc.), many concerns were raised about the rising cost of auxiliary materials such as cutting oil, rubber products, and packaging materials. Furthermore, comments like "unit prices have risen to record highs, but we can't keep up with price pass-throughs" were prominent, highlighting a structure that squeezes profits. ○ "Can't Get Materials" - The Anomaly in Procurement Regarding raw material procurement, 61.6% of companies answered it "has an impact" or "has a slight impact." In particular, there were many reports of difficulties in obtaining resin materials and thinner/solvent-related products, as well as delivery delays. Specific answers included instances of manufacturers imposing quantity limits or halting shipments, with statements like "we can only purchase the same amount as the same month last year." Moreover, shortages of rare earth materials like tungsten have led to cases where machine parts, molds, and semiconductor-related products cannot be completed. ○ "Orders Exist, but We Can't Produce" - The Situation on the Manufacturing Floor Regarding the impact on order volume, 46.8% of companies answered it "has an impact" or "has a slight impact," but for the impact on revenue, the figure rose to 80.7%. In the automotive and semiconductor manufacturing equipment sectors, multiple cases were reported where "orders are coming in, but production is impossible due to material shortages or undelivered parts." On the other hand, for products like resins, some companies saw a temporary increase in production due to last-minute demand before price hikes and advance procurement. [Survey Overview] Organizer: NC Network Co., Ltd. Period: April 7 - April 17, 2026 Method: Web-based survey Target: Emidas member companies Number of responses: 149 companies [Respondent Attributes] Click here for detailed survey results. NC Network will continue to actively gather and publish information on business conditions according to social situations to assist SME manufacturers. Furthermore, on "EMIDAS magazine WEB," launched in April 2024, we widely disseminate information to solve manufacturing challenges and foster innovation in craftsmanship. We focus on development, technology, and products that lead to solving and implementing solutions for social issues, aiming to contribute to the revitalization of the industry.