Europe’s chemical sector finds itself in a worrying situation, according to new data from the European Chemical Industry Council, Cefic. Its Chemical Trends Report Q3 2025 notes that chemical companies are facing a very difficult global economic context and warns: "Energy prices in Europe remain among the highest in the world, and demand is still disappointing.”
Across the EU 27, chemical sector business confidence, from January to August 2025, remained weak, according to Cefic. Citing the most recent EU Commission Business and Consumer survey it says: “Confidence in the EU27 chemical industry significantly deteriorated during January to August 2025, compared with the same period in 2024.”
Germany saw the sharpest decline in confidence ( -8.5), followed by France (-7.7). Declines were also seen in Poland, Italy, Spain and the Netherlands. However, Belgium’s chemical sector reversed this trend showing an improvement of 1.9 in the same period.
The falloff in business confidence was also reflected in Cefic’s analysis of EU27 chemicals production. Overall production, from January to September, was down 2.5% when compared with the same period in 2024. The steepest decline in production was seen in the Netherlands, falling 6.2%, while output in France fell 3.9%. Production falloff was seen in Germany, Italy, and Spain. However, aligning with business confidence, production in Belgium saw an uptick, of 0.2%.
“The EU27 chemical business is struggling. The sector continues to face fierce competition, particularly from China. Foreign trade, which has always been a driving force of the European economy, is not significantly improving,” Cefic said.
Cefic’s analysis also showed that while manufacturing sector output as a whole rose by 1.4% from January to September 2025 in the EU27, most of the downstream users of chemicals reported a decline in output. “For instance, the automotive sector is still experiencing a significant decline of about 3.4%.” the report says. With decreased demand from the chemical-using sectors, the EU27 chemical industry reported an output reduction of 2.5%, which Cefic said is “far below the overall EU27 manufacturing average.”
Cefic added: “The output of the EU27 chemical industry remains 10% below the pre-crisis levels of 2014 to 2019. Unfortunately, no strong positive changes have been observed so far this year and business expectations for most downstream users are still not encouraging.”
Despite the decrease in EU27 chemical industry output, chemical imports rose by 3.4 million tonnes in January to August 2025, reaching 69.1 million tonnes, up from 65.7 million tonnes during the same period in 2024. Of all the chemical imports, the US accounted for 10.1 million tonnes, followed by China (6.7 million tonnes) and the UK (6.3 million tonnes).
The report also highlights that from January to August 2025, chemical exports decreased by 1.4 million tonnes when compared to the same period in 2024. EU chemical exports amounted to 61.4 million tonnes in the first eight months of 2025, down from 62.8 million in 2024. The UK was the primary source of exports, followed by the US and Turkey.
Cefic noted that energy prices – approximately three times higher than the US – remain a core concern of the sector. "In addition, the recipes that worked in the past seem to have reached their limits: Europe is suffering from being an open market and from its unmatched level of regulation to the point that Europe has now entered a critical phase," it said.
The position of the European chemical sector is a reflection of those patterns: exports to international markets fell by 2.3% in the first eight months of 2025, while imports surged by 2.6% over the same period, Cefit noted. "Uncertainty continues to penalise investment, and forecasts for 2025-2026 are poor. The number of closures in the chemical sector is leading to deindustrialisation, to the benefit of countries offering a cost advantage,” it said.
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