(Yicai Global) March 7 -- China is expected to see an increase in prices of chemical products as the government tightens its supervision of environmental protection regulations, which could lead to rising costs related to raw materials and logistics.

Many chemical enterprises have been forced to suspend operations due to non-adherence with environmental protection requirements, insiders told Yicai Global, adding that the decrease in supply will result in an increase in production costs thereby driving up product prices in China.  

China's environmental ministry has doubled down on air pollution rules in the northern Beijing-Tianjin-Hebei region since April last year, sending out 322 notices to firms across 28 cities. The companies concerned have until April 8. to adhere to the environmental requirements.

Several major chemical enterprises such BASF SE, Covestro Group, DowDuPont, Akzo Nobel NV and Nippon Chemical Industrial Co. have already sent out notices of prices increase to clients.

BASF issued notifications of a 15 percent hike in the resin and additive product prices to customers in the Asia-Pacific region in February, the firm told Yicai Global, adding that the increase is attributable to rising costs for raw materials, transport, and packaging. An insider from Covestro added that the strong demand in the Chinese market also pushed up prices.