<div id="readability-page-1"><div> <pre> By Kimberley Kao and Fabiana Negrin Ochoa </pre> Gauges of Asia factory activity showed more evidence of supply-chain disruptions from the Middle East war, with stockpiling buoying production as cost pressures intensify. S&amp;P Global purchasing managers indexes released Monday showed that while production sped up in major economies last month, that was partly because of fears about shortages and higher prices as the conflict choked trade flows. Since the hostilities began in late February, prices of energy and other commodities have surged, weighing on economies in Asia--a region that relies heavily on the Middle East for oil, gas and critical inputs like fertilizers. The turmoil is squeezing manufacturers, driving up costs and weighing on sentiment. For now, the uncertainty is helping fuel orders in some economies as clients and producers alike rush to stockpile inventory, the S&amp;P surveys indicated. Headline manufacturing PMIs rose in Taiwan, Japan and South Korea in April as anxiety over future supply-chain delays and price increases prompted more purchasing. Other factors contributed to the upswing in sales and output, including artificial-intelligence-related demand in Japan and Taiwan, and new product launches in South Korea. Still, businesses are turning more cautious as it remains unclear when the Middle East situation will be resolved and analysts warn that it will take time for markets to normalize. &#34;The war contributed to the greatest disruption to supply chains since the Covid-19 pandemic,&#34; said Annabel Fiddes at S&amp;P Global Market Intelligence. In April, Taiwan's manufacturing industry saw expenses rise at one of the fastest rates since the PMI survey began 22 years ago, she said. That was echoed in South Korea, where manufacturers reported record increases in cost burdens and charges. Input costs hit multiyear highs in Japan, Indonesia and Vietnam too, as raw materials became more expensive. Similar cost pressures were seen in India, where factory growth stayed sluggish--marking the second-slowest improvement in operating conditions in nearly four years. In Indonesia and Vietnam, the spike in costs came alongside a pullback in output, signaling higher vulnerability among emerging economies. New orders in Vietnam fell for the first time in eight months in April, and output will follow suit ahead unless the price and supply environment improves soon, said Andrew Harker at S&amp;P Global Market Intelligence. Output has already contracted in Indonesia, and economists warn that manufacturing sectors elsewhere could follow suit once stockpiling tailwinds fade, even in countries benefiting from continued global demand for tech and AI exports. &#34;How sales and output develop once this effect wears off over time will be central to the health of the sector in the months ahead,&#34; said Usamah Bhatti at S&amp;P Global Market Intelligence. <pre></pre> Write to Kimberley Kao at kimberley.kao@wsj.com and Fabiana Negrin Ochoa at fabiana.negrinochoa@wsj.com <pre></pre> (END) Dow Jones Newswires May 04, 2026 02:17 ET (06:17 GMT)Copyright (c) 2026 Dow Jones &amp; Company, Inc.</div></div>

ICOP

The Asia manufacturing sector is facing significant strain due to supply-chain disruptions caused by the ongoing conflict in the Middle East. S&P Global's purchasing managers indexes indicate that while production has increased in major economies, it is largely driven by stockpiling in response to fears of shortages and rising costs. The conflict has led to surging prices for energy and commodities, impacting manufacturers across the region. Despite some growth in orders, businesses are becoming more cautious as uncertainty persists, with analysts warning of potential declines in output as stockpiling effects diminish.

Asia Manufacturing Sector Feeling Strain From Middle East Conflict