European chemical production fell 3.2 percent in the first quarter

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Recently, the European Chemical Industry Commission (Cefic) released the latest industry trends report showing that the total chemical production in Europe in the first quarter of 2026 fell by 3.2 year-on-year. Taking 2021 as the base year with an index value of 100, this year’s cumulative production index stands at only 84.4. Major economies showed marked divergence: France was the only major country to post positive production growth, up 2.4% year on year; the Netherlands recorded the largest decline, at 9.4%, while Italy and Germany saw drops of 7.7% and 4.3%, respectively.

Specific to the category level, basic organic chemicals, polymer production fell 12.7 percent, 9.2 percent year-on-year, dye pigments, pesticides, detergents, paint inks are reduced to varying degrees, only daily beauty and other end consumer and other chemical categories slightly increased by 2.2 percent, 1.3 percent.

Capacity utilization has seen a modest recovery, rising to 74.3% in the second quarter—an increase of 1.1 percentage points from the first quarter—however remains well below the prolonged average of 81.3%. Cefic acknowledges that while the sector experienced a modest recovery at the start of the year, underlying challenges such as weak domestic demand, capacity contraction, and intensifying international competition remain unresolved. Coupled with U.S. trade barriers and the export risks stemming from geopolitical tensions, the sector’s outlook continues to be characterized by significant uncertainty.

Prices and sales showed a divergent direction: in the first quarter, the ex-factory price of chemicals continued the rally at the end of last year, rising 0.9 percent month-on-month, and the price index rose to 114.5; the sales index in the first two months only 91.3, shrinking 7 percent year-on-year, and the willingness of downstream companies to replenish their warehouses was sluggish, and the volume of orders continued to weaken.

Foreign trade data are under significant pressure. In January–February, Europe’s chemical exports totaled €32.7 billion, a year-on-year plunge of 12.4%. Exports of basic organic chemicals and polymers fell by 26.8% and 16.5%, respectively, while exports of inorganic basic chemicals edged up by 1.6%. Meanwhile, imports amounted to €26.0 billion, down 15.7% year on year. The decline in imports exceeded that of exports, resulting in a slight widening of the sector’s trade surplus to €6.7 billion.

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