Cefic: EU chemical output “stagnant”

Brussels – The European Chemical Industry Council (Cefic) has published its latest annual report on European chemical trends which highlights a stagnant output in the continent and declining sales.

According to the report released on 14 April, European chemical output grew just 0.2 percent in 2014 while sales fell 1.1 percent, year-on-year.

Net exports of EU chemicals reached €44.1 billion for the full year 2014, significantly below the record €48.2 billion surplus achieved in 2013.

Net positive trade balance with non-EU countries – a group including Russia, Turkey and Switzerland – was down by €3.1 billion at €11.7 billion in 2014, mainly due to a “sharp” fall in net exports to Russia, which Cefic described as “an important EU chemicals trading partner”.

“Net exports plunged by 51 percent year on year, as exports to Russia fell 4.0 percent, or €403 million, and imports jumped by 12.5 percent, or €931 million,” the report added.

Meanwhile, the EU chemicals trade surplus with Asia – excluding Japan and China – widened by €544 million, while trade surplus with China contracted from €1.3 billion to €671 million.

The US also further narrowed its chemicals trade deficit with the EU by €889 million to €5.4 billion during full-year 2014.

The worrying performance continued in January 2015, Cefic’s latest monthly data shows. Output contracted 0.3 percent compared with January 2014, while EU chemicals prices plunged 6.0 percent.

Chemicals confidence fell in the first quarter of 2015 compared to the last quarter of 2014. Meantime, chemicals order books and production expectations for the coming months have worsened.

Despite a drop in oil prices, which lowers producer costs, long-term problems persisted, especially the challenge of securing affordable energy supplies, said Cefic director general Hubert Mandery.

The biggest hit was taken by petrochemicals output in January 2015, with a 7.6-percent slide compared with January 2014. The drop, noted Cefic, was partially offset by 4.2 percent growth in output of speciality chemicals.

Basic inorganics output contracted by 1.2 percent. Polymers and consumer chemicals output declined 0.6 percent and 0.2 percent respectively in January 2015 compared to January 2014. Overall, EU chemicals output declined by 0.3 percent in January 2015 year-on-year.