Brussels, 24 April 2017 - According to a Eurozone economic outlook report the prospects for global economic activity improved in recent months, despite political uncertainty and increased inflation. These positive signs are reflected in the latest Cefic Chemical Trends Report (CTR) - a monthly economic snapshot of the European chemical sector in Europe – which shows a spike in output in many chemical subsectors during the first two months of 2017 (year-on-year).
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Output increased during Jan – Feb 2017 compared to the same period of 2016 for most subsectors. Production saw an increase in dyes and pigments (1.6 per cent), plastics in primary forms (4.7 per cent) and industrial gases (8.6 per cent). However, output saw a decline in subsectors like synthetic rubber (-3.5 per cent), fertilisers (-2.3 per cent) and petrochemicals (-1.5 per cent). All in all, output in EU chemicals sector grew 1.6 per cent during the same period.
For those sectors that increased their production, the increase is not necessarily matched by buoyant profits. 2016 data shows clearly that the decline in producer prices (-3.6 per cent) affected significantly EU chemicals sales (-2.1 per cent) and then profits.
Trade figures for 2017 compared to 2016 showed less positive signals. In polymers, Extra-EU exports in value went down by €0.9 bn in 2016 compared to 2015. The same goes for basic inorganic and specialty chemicals. Exports outside the EU went down by €133 million in 2016/2015. Imports went down by 3.4% (€3.4 billion less in 2016 compared to 2015). The overall increase in trade surplus is not due to better export performance but due mainly to a strong decline in imports.
Long-term business prospects still a challenge
In Q1 2017, the business climate also improved for the EU chemical sector and the total demand experienced by chemical companies is up. Cefic expects this relative positive trend to last beyond this quarter. Following years of stagnation since the economic crisis, the chemical industry is as close as it has been to pre-crisis production levels, 3.6% below Q1 2008 instead of 4 - 5%. Overall, output growth was less than 1% during the last 5 years (2012 - 2016), which shows that the chemical sector in Europe will have to find new ways to deliver strong growth for the long-term. The EU chemical industry is losing market share and long-term output growth due mainly to energy and feedstock costs compared to other more competitive regions.
Contact: Dervla Gleeson, Cefic Media Relations Manager (email@example.com / +32 (2) 676 7289)