Eastman lifts prices, secures raw materials amid global supply pressure

Middle East tensions are showing up in Eastman Chemical’s factory margins before they reach downstream customers, and the company is moving quickly to pass along the pressure. Eastman said it is implementing roughly $500 million of price increases across its portfolio to offset sharp raw-material and distribution inflation, a sign that geopolitical shocks are still traveling from shipping lanes to industrial balance sheets.

The Tennessee-based chemical maker reported first-quarter sales revenue of $2.177 billion, down from $2.290 billion a year earlier. Adjusted EBIT fell to $200 million from $311 million, and adjusted earnings per diluted share slipped to $1.09 from $1.91. Even so, Eastman said adjusted EBIT margin improved 240 basis points sequentially, helped by stronger sales volume and better price-cost discipline.

Chief Executive Mark Costa said Eastman delivered a solid quarter in line with expectations and moved immediately to secure crucial raw materials after global markets reacted to conflict in the Middle East. The company said it is leveraging its U.S.-based assets and global reach to remain a reliable supplier as energy, transport and feedstock costs move more quickly than customers can absorb.

Demand also improved inside the quarter. Eastman said specialty businesses posted more than 10% sequential sales volume and mix improvement, a rebound tied to normal seasonal patterns and less caution from customers after year-end inventory management. Planned maintenance costs weighed on results by about $45 million, leaving less room for earnings growth even as underlying volumes firmed.

The pricing response is already spreading through the company’s product lines. Eastman announced a specialty plastics price increase effective April 1, 2026, or as contracts allow, part of a broader effort to protect margins in a cost environment still shaped by volatile raw materials and freight.

Eastman’s Kingsport, Tennessee methanolysis facility remains a central part of that strategy. The plant began initial production and ramping in March 2024, delivered about $60 million of incremental earnings in 2025 versus 2024, and produced more than 2.5 times its prior-year quantities. Eastman said the facility is still ramping and is on track to contribute around $30 million of incremental earnings as it scales.

The company said it is also making progress toward $125 million to $150 million of cost savings, after exceeding its earlier target in 2025 with about $100 million in savings against a goal of more than $75 million. Eastman returned about $500 million to stockholders last year through dividends and share repurchases, underscoring its effort to preserve cash while funding pricing, supply security and circular-economy investments in a more turbulent global market.