EU chemical production may increase by 3% in 2021

The European Chemical Industry Association stated on February 25 that EU chemical production is expected to increase by 3% this year after a drop of nearly 2% in 2020.

The director-general of the European Chemical Industry Association called the changes in these indicators a "sprout", but he called on the EU to implement a comprehensive industrial policy to help chemicals continue to grow.

Although the market expects that demand will be slightly weaker in the second quarter, the strong demand in many chemical markets in the last few months of 2020 is expected to continue this year.

In the second half of the year, the bargaining power may weaken, especially in commodity chemicals.

It is estimated that the output of this industry will increase by 2% in 2022.

Following the overall decline last year due to the strict blockade imposed by the region at the beginning of the epidemic, the total EU chemical production capacity fell by 6% last year compared with 19 years.

Data shows that sales have also fallen sharply. Compared with the same period in 2019, sales from January to November 2020 have fallen by 34.8 billion euros.

Exports fell by 7.4 billion euros, or 4.5%, because rising demand for public health-related chemicals failed to offset the decline in broader manufacturing output.

The ambitions of the EU Green Agreement

Marco Mensink, director-general of the European Chemical Industry Association, said that the observed "sprout" requires further support from policymakers to maintain its growth.

Mansing said: “The chemical value chain is one of the most resilient industries in Europe. The industry has stepped up in the epidemic and met its own development expectations, while providing valuable support in the supply of disinfectants.”

"A full recovery requires further support. A strong industrial policy can not only support the industries that need help, but it is also closely related to the most resilient industries, which are the foundation of the future economy."

As the European Union embarks on a green agreement (which aims to decarbonize the economy by 2050 and avoid fossil fuels), Mansin said that "large-scale investment" is needed.

Before the European Commission, the executive body of the European Union, announced a new industrial strategy, Mansin called on policymakers to make chemicals the center of their manufacturing plans.

Mansing said: "In order to ensure the substantial investment required for the transformation of our industry's green agreement and maintain the successful export case of the European chemical industry, we look forward to the European Commission's new industrial policy strategy to provide a market for the industry to become more sustainable. And conditions."