Kozhikode, Kerala: The footwear manufacturing sector in Kerala is facing a severe crisis due to the sharp rise in raw material prices amid the ongoing Middle East conflict, industry bodies said on Thursday.

The announcement was made by FOOMA (Footwear Manufacturers Association of Kerala) and CIFI (Confederation of Indian Footwear Industries) at a press conference.

Citing unsustainable production costs, the organisations announced a price hike of around 10 per cent on footwear, which will come into effect from March 23.

They said that global crises, including tensions in the Gulf region, have led to a steep increase and shortage of key raw materials such as PU, synthetic rexine, rubber, PVC, EVA, adhesives, and packaging materials. Rising transportation costs have further worsened the situation.

“Until now, companies have been absorbing the increase in raw material prices themselves. However, the current situation has become unbearable,” the representatives said.

They also expressed concern that the sector could face a complete shutdown in the coming days, as thousands of migrant workers are returning to their home states due to an LPG shortage.

Those who attended the press conference included Paul Varghese, AV Sunilnath, Rajith Mullassery, Shamsudheen KV, Akhilesh C, and Babu Malayakkal.

The footwear industry is closely linked to crude oil prices because many key materials used in manufacturing, such as polyurethane (PU), PVC, EVA, synthetic rexine and adhesives, are derived from petrochemicals. When crude oil prices rise, the cost of these raw materials increases, pushing up overall production expenses. Even rubber prices can be indirectly affected, as higher oil prices make synthetic alternatives costlier, influencing demand and pricing dynamics.

In addition, rising crude oil prices lead to higher fuel costs, which significantly impact transportation, logistics and packaging. This increases the cost of importing raw materials and distributing finished products. As a result, manufacturers face mounting pressure on margins and are often compelled to pass on the increased costs to consumers through price hikes.

Meanwhile, Brent crude oil, the international standard, briefly surged above $119 a barrel, up more than 60% since the war started. The European benchmark for natural gas prices also rose sharply and has roughly doubled in the past month.