European chemicals: competitive pressure, high costs and the risk of deindustrialisation

The European chemical industry is going through a particularly critical phase, shaped by a complex global economic environment and deteriorating competitive conditions. Companies in the sector are faced with increasingly aggressive competition, especially from China, while one of the traditional strengths of the European economy – foreign trade – shows no clear signs of improvement. This is, in essence, the picture that emerges from the report published by Cefic, the European Chemical Industry Council, on the health of the chemical industry in the Old Continent over the first eight months of 2025.

In terms of costs, energy remains the main vulnerability: in Europe, prices are still among the highest in the world and are around three times those in the United States. This situation weighs heavily on the balance sheets of chemical companies, already penalised by weak domestic demand, and further undermines their ability to compete on global markets.

The latest figures confirm this challenging scenario. In the first eight months of 2025, exports from the European chemical sector to international markets fell by 2.3%, while imports increased by 2.6% over the same period. The industry is therefore struggling to strengthen its presence abroad while at the same time facing a rising flow of incoming products.

The combination of an open European market and an unparalleled level of regulation is also having a significant impact. While this framework has so far supported high standards, it is now contributing to pushing the system into what can legitimately be described as a “critical” phase. In this context, uncertainty continues to weigh on investment, and forecasts for 2025–2026 remain weak.

The growing number of plant closures in the chemical sector clearly points to a deindustrialisation process already under way, to the benefit above all of countries able to offer more favourable cost conditions than Europe. This is a clear sign that the current situation is not merely a temporary downturn, but a genuine structural problem for the European chemical industry.