Chemical plant closures in Europe have surged since 2022 with companies shuttering around 9% of Europe’s total production capacity, even as new investments has collapsed, leading to growing concerns over the competitiveness and long-term viability of the sector, according to data from European chemicals industry body Cefic.
“It’s no longer a question of being five minutes before or after twelve. The sector is under severe stress and breaking,” says Marco Mensink, Cefic’s director general.
“The rate of closures has doubled in a year, and even worse, annual investments are half and close to zero. On both sides, the speed is accelerating, not slowing. We need decisive action this year, with impact at factory floor level,” he says.
In the last two decades there has been a rapid rebalancing of the global chemicals industry. While in 2004 Europe accounted for 27% of sales, by 2024 that had dropped to 13%. In contrast, China’s share of sales had jumped from 10% to 46% over the same time. High energy costs, weak local demand and pressure from low cost imports have all contributed to Europe’s struggles.
This report underlines the human and economic impact of the ongoing wave of closures. Beyond the 20,000 direct job losses, an estimated 89,000 indirect jobs are also at risk across Europe, the industry group says, reflecting the chemical industry’s role in broader supply chains.
Cefic said that new investment has slowed dramatically from 2.7 Mt of new capacity in 2022 to just 0.3 Mt year-to-date in 2025.
“This drop reflects a shift from broad investment across multiple innovation pathways – like electrification, hydrogen feedstocks, and circular plastics – to barely one pilot initiative,” the report says. “With closures now significantly outpacing new investments, the European chemical industry is contracting. This trend points to deepening uncertainty for the sector and raises serious questions about Europe’s ability to maintain a competitive, resilient industrial base,” the report said.
The pace of closures has accelerated recently. In 2022 plant closures announced in European chemical industry totalled 2.9 Mt of capacity, but by 2025 this had jumped to 17.2 Mt. Closures focused on upstream petrochemicals (17.8 Mt), followed by basic inorganics (11.7 Mt), polymers (5.4 Mt), and specialty chemicals (2.0 Mt).
For petrochemicals, around half of the total announced capacity closures were the result of nine steam crackers closing - a 16% net reduction in European steam cracking capacity.
Cefic said the closure announcements range across Europe, but the largest shares in key chemical industry countries including Germany (8.8 Mt), the Netherlands (7.2 Mt), UK (4.5 Mt), France (3.9 Mt), Italy (2.5 Mt), Belgium (2.3 Mt), Spain (1.6 Mt). In half of the cases, companies indicate energy cost competitiveness as the primary rationale for closing, followed by demand-related considerations (19%), overcapacity (9%), and regulatory factors (8%).
Confirmed investments in the industry have declined over the same period, from 2.7 Mt in 2022 to just 0.3 Mt in 2025. In terms of where the investment is going, petrochemicals is the recipient with 3.8 Mt of confirmed investments in 2022-25 – certainly not enough to offsets the 17.8 Mt closures.
The largest confirmed capacity investments are in Belgium (2.4 Mt), Germany (0.8 Mt), and France (0.4 Mt). There is some investment going into projects related to the battery value chain (€1.9 bn) emission reduction (€1.9 bn), and recycling (€1.5 bn, 11%) although the report noted that even these sectors follow the overall decreasing trend.
Further reading
- Chemistry in 2026: Navigating the year of uncertainty
- Chemistry in 2026: The global outlook
- Chemical industry outlook: Will it be profits or problems?
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