Chemical makers find crumbs of comfort amid business 'deterioration'

Brussels – Confidence in the European chemicals industry held up “slightly” in August despite continuing pressures following four months of marked decline, industry body Cefic has reported.

In its monthly review, Cefic described the business situation as "stable but not satisfactory” amid persistent issues impacting chemicals manufacturing companies.

Citing the August edition of an EU business & consumer survey, Cefic said managers are seeing a 'continuing deterioration' in the current level of orders.

However, assessments of stocks of finished products improved slightly, leading to an increase in managers’ expectations regarding production levels, noted the 26 Sept study.

Overall, business managers’ assessments of their order books were slightly lower in August compared to July, and “still far below the 2021 pre-crisis levels.”

Lack of chemicals demand, added Cefic, is “still weighing on the business mood.”

Breaking down industry performance over the month of July, the report said chemical selling prices were 13% year-on-year.

In particular, sectors such as fertilisers, polymers and petrochemicals saw declines of 37%, 18% and 18% respectively.

In the first seven months of 2023, the EU27 chemical selling prices were down by 2% compared to the same period of 2022.

In terms of production, the first seven months of 2023 saw output decline 12% compared to the year before.

“The results of this first seven months of the year continued to be disappointing for most countries,” said Cefic.

The association linked this to a “spillover effect” from the 2022 energy crisis, which it said is still “severely impacting most business sectors in Europe”.

Cefic's analysis by country showed that Poland, The Netherlands and Germany were among the EU countries most impacted by the energy crisis, each reporting production declines of over 15%.