Cefic foresees a decline of approximately 8 % in EU27 chemical production in 2023 compared to the previous year, and there are no signs of immediate recovery in chemical demand in Europe. This outlook is applicable to nearly all business segments, although consumer chemicals seem to be more resilient.

This economic forecast follows a weak start to the year. The first four months of 2023 have not shown a robust recovery after the production slump in Q4 2022. In Q1 2023, production volume already decreased by 13.5 % compared to the previous year. During Q1 2023, the capacity utilization levels were similar to those seen during the first Covid lockdown in 2020, at around 75 % of normal levels. Customer demand for chemicals, both domestically and internationally, continued to decline, resulting in the need to further reduce chemical inventories. Indicators show that incoming orders for the European chemical industry are still declining.

“The EU chemical industry is facing a perfect storm. The combination of high energy prices, lack of global demand, and the US IRA means there is simply no business case for investing in Europe now. The Green Deal needs a business case in Europe. We urgently call on European leaders to make private sector investments in Europe’s industrial transformation the main priority during the next legislative cycle.” said Cefic Director General Marco Mensink.

• European Chemical Industry Council (Cefic), Brussels, Belgium