Market Scenario EU Chemical Output Shows Modest Recovery amidst Covid-19: Cefic
Cefic’s latest data has revealed that chemical output from June reported 2.9 % output growth compared to May of the same year however, it is still about 9 % below the pre-crisis level i.e. June compared to Feb of 2020.
Brussels/Belgium – Cefic has published the most recent data on the output in the chemical industry and other manufacturing sectors as well as sales and trade volumes.
The key findings are as follows:
- 1. Chemical output in the EU27 dropped by 5.2 % from January – June 2020 compared to the previous year’s level (January – June 2019), following the Covid-19 outbreak in Europe, but some first signs of recovery can be seen.
- 2. The spill-over effect of the crisis will continue for a while, but the weakest economic point of 2020 seems to have been reached in April. The chemical output data from June reported 2.9 % output growth compared to May of the same year, however, this is still about 9 % below the pre-crisis level (June compared to Feb of 2020).
- 3. Small and medium-sized enterprises operating in the chemicals business are still facing liquidity issues following the Covid-19 outbreak: Many of the SMEs are family-owned mid-size companies, which typically do not have a large backstop. They will continue to face delayed payments in the near future from customers, but it is too early to capture a complete measure of these effects.
Marco Mensink, Cefic Director General: “Like other manufacturing sectors, the EU chemical industry has been severely hit by the current economic downturn during the Covid-19 outbreak, we are now encouraged to see some first, although very modest, signs of recovery in the European chemical output.
At the same time, it is clear that the impact of the crisis varies between the sectors of the chemical industry and the overall decline in cross-sectoral manufacturing activity, including automotive and refining, is likely to affect the pace of some investments. This makes the need for a coherent policy framework to support European investments into these technologies all the more critical and timely.
At Cefic, we are calling for a ‘sectoral Green Deal’ to drive greater policy coherence. With the right policy framework, the EU Recovery Package could be an opportunity to prioritise investments into innovative Green Deal solutions, such as e-crackers, chemical recycling, hydrogen, CCS and CCU infrastructure and other new technologies our sector is innovating and developing.”
For more details, read the full Chemicals Quarterly Report here.