Cefic’s Post

With global economic weakness and destocking driving demand deceleration following COVID-19, this year’s trajectory for petrochemicals has been marked by softening demand, increased capacity online, historically low earnings across various chemical value chains, and slowing growth in circularity. Despite these challenges, our latest analysis shows that conditions may now be in place for a more typical recovery cycle, albeit one that plays out over several years. With moderate improvement likely in the near term, learn more about the supply and demand side dynamics that are shaping the way forward for the petrochemical sector. #petrochemicals #chemicalsmarketoutlook

I find this report really worrysome, especially the bar chart and table on the last page "Chemicals production growth for main countries", providing yoy growth in % for 2022 and 2023. For two years in a row now, the entire world is loosing #chemicalproduction to #China, where chemical production in 2023 grew by almost 10% (Jan-Nov numbers). The loss of chemical production in the #EU27 accelerates 2023 vs 2022 even. Another chart in the report shows, how this is particularly profound in petrochemicals, polymers and chemicals (less so in specialties and consumer chemicals). HOWEVER, chemical production works well when process streams are tightly integrated. And it is not resilient, when raw materials need to be shipped over the entire planet and then find their way through bottle necks like the Suez channel - as we experience it these days, AGAIN.

Our December 2023 Chemical Trends Report is out 📊. 2023 was a challenging year. Sales and production dropped by 8.7% for the first 11 months, reflecting weakened EU economy confidence. 📉 Factors like high energy costs and reduced demand are affecting Europe's chemical industry. Chinese imports pose a growing challenge, and we anticipate this trend to continue. 🌍 While some chemical sub-sectors showed a slight uptick in November 2023, a full recovery remains uncertain. 2024 may bring gradual growth. Read the full report ⬇️: https://lnkd.in/er7Pk3gS #chemicalindustry #energycosts #chemicalproduction #energycrisis

📊 Just released: our December 2023 Chemical Trends Report. Read the full report for insights and projections #ChemicalIndustry #EconomicTrends #2023Review #2024Outlook

🌎 Have you read #AllianzTrade latest global sector risk reports? 🔍 Our sector risk ratings assess the risk of non-payment by companies in 18 sectors across 70 countries, using a four-level scale from low to high. This week, let’s look at chemicals 🧪, which includes basic or commodity chemicals and specialty chemicals. The gloomy global economic outlook is driving down chemical sales in 2023. But as energy prices remain higher in Europe than the US, US producers will continue to enjoy a competitive advantage over their European peers. Not all sub-sectors are in the same boat: producers of specialty chemicals have higher pricing power than those that make basic chemicals. So they can pass on higher production costs to their customers. Read the full #SectorRiskReport for chemicals here: https://ow.ly/EO5C50PPHmw #economy #chemicals

Cefic has posted its Chemical Trends report - revealing that, compared with 2022, 2023 ended on a weaker note for the chemicals industry in Europe. The report shows that the European chemicals industry produced less, exported less and imported less in 2023 and recovery is still a way off for most EU27 countries. The two main reasons are high energy costs and trade dependency in times of geopolitical disruptions. Rest assured that confidence is slightly improving as we soon enter Q2 of 2024. Read more: https://lnkd.in/er_fHH9t

The U.S. and European #chemicals sectors continue to face challenges, including #earnings declines and high costs. How soon this beleaguered sector can expect a turnaround remains unclear. Get more details in the S&P Global Ratings article: https://okt.to/w6bAGu

🔍 European Chemicals Sector: Adapting to Challenges and Policy Changes The European chemicals sector, crucial to the economy, is navigating a challenging landscape marked by fluctuating demand and significant policy changes. Key Challenges: 📉 Demand Volatility and Policy Shifts: Sharp demand fluctuations and the impending 2026 ban on PFAS ('forever chemicals') pose major challenges. PFAS are essential for various industries, impacting future output, particularly in the Chemicals & Plastics sector. 🔄 Supply Chain Disruptions: Persistent issues since the pandemic, exacerbated by geopolitical tensions, continue to affect production and distribution. Market Insights: 📊 Despite ongoing declines, the S&P Global Chemicals PMI for Europe shows signs of recovery as of March 2024, with new order declines slowing. Outlook: 🔍 Recovery is expected to continue into 2024, supported by restocking activities and improving investor sentiment since late 2023. The European chemicals sector stands at a critical point, with the need to adapt to environmental policies while facing substantial internal and external pressures. Its resilience and innovation will be key to navigating these changes successfully. Interested to hear everyone's insights on this. Let me know your thoughts in the comments! 💭 Read full article here: https://lnkd.in/g2ERFWsE #ChemicalsIndustry #EuropeanMarket #Sustainability #SupplyChainManagement #MarketInsights

BLOG: Chemical prices start to slide in Asia and Europe as summer slowdown starts early Click here to see the latest blog post on Chemicals & The Economy by Paul Hodges, which looks at how chemical prices are starting to slide in Asia and Europe. #ICIS #blog #chemicals #economy #IPEX #oil #OPEC #CPI #inflation #GDP https://bit.ly/4edyeur

📢 The #ChemicalIndustry faces turbulent times. Last year started with lower COVID-19 restrictions and optimism due to favorable 2021 S&P 500 returns. But ongoing #SupplyChain disruption and rising #InflationRates dampened optimism. When Russia invaded Ukraine, the world prepared for both a humanitarian crisis and the next economic crisis, as #EnergyCosts and select products were negatively affected.   While the #chemical industry was impacted by a softening economy, it responded well to rising input costs. Producers were able to increase chemical prices alongside raw #MaterialCosts, leading to a gross #ProfitMargin of 29%, which is in line with the average of the past 2 years. The slowing economy impacted volumes, however, which deteriorated throughout the second half of the year. Many producers also observed destocking, especially in Q4 and into 2023.   ➡ In our annual Winners’ Study, we analyze the performance of publicly listed chemicals companies and provide insights into the factors that set the winners apart from their peers. If you’re interested in understanding the placement of certain chemical players on the matrix, or would like to read more about the drivers shaping the chemicals industry today, reach out! 💡 Download the full publication here: bit.ly/44BrH7C   #ChemicalIndustryExperts #RolandBerger   Rob Henske Jonathon Wright Frank Steffen Hendrik Disteldorf  Christian Lumpe Ruirui Zong-Rühe Rett Johnson Mathieu Rasamoela Alexander Baumgartner Brag Selvarajan Bradley McMullin, CFA Dilhani De Silva