15 December 2022
The world is witnessing a global restructuring of the chemical industry, with a reorientation of its main production regions and sales channels, the search for new sources of raw materials, regulatory issues and environmental concerns.
The chemical industry in European countries
For now Europe is the second largest producer of chemical products in the world.
Two thirds of chemical sales in the EU are generated by four countries. Germany is the largest producer, followed by France, Great Britain and Italy. The next key players are Spain, the Netherlands, Belgium and Ireland.
All together, the countries listed above produce 88% of all chemical products in the EU. Of the new EU member states, Poland is the biggest contributor, accounting for 1.9% of chemical production.
Raw material base of the chemical industry in Europe
The European chemical industry is based on both domestic and imported raw materials: coal, oil and gas. Therefore, chemical plants are located in the production areas as well as on the coastline.
Organic and polymer chemistry and petrochemicals are well developed in France, Germany, Italy, the Netherlands, Belgium and the UK.
Mineral fertilizers are produced in factories in France and Germany.
The pharmaceutical industry is traditionally strong in Sweden, Switzerland, Germany and Bulgaria.
Thus, for chemical companies, both the search for new customers and the search for the most profitable suppliers are equally relevant. A digital tool like EasyList is able to meet the needs of both sales departments and purchasing managers. With just a few clicks, you will get a list of potential buyers or suppliers in 70 countries around the world at your fingertips.
The competitive potential of European chemicals
The main advantages of the chemicals sector in Europe lie in its favorable business environment and political stability, which is markedly higher than in manufacturing centers such as China and India.
The main European chemical producing countries have a better chemical infrastructure than Asia or Latin America, including transport, supply chains, logistics and energy supply.
On the plus side, there is also a high quality of research institutions, a high share of company expenditure on R&D and the availability of highly skilled labor resources. Companies in the EU spend about 1.6% of their chemical investment on R&D per year, compared to just 0.8% in China.
The marketing, sales and purchasing departments of European chemical companies have sufficient budget at their disposal to use innovative digital tools to find new partners. EasyList is one such solutions, enabling the generation of any marketing list for specific requests, including:
- Targeting
- Lead generation
- Prospecting for new buyers
- Search for new suppliers
- Generation of mailing lists
- Generation of cold call lists
- Competitor analysis
- Identifying of decision makers
By continually improving its competitiveness, the European chemicals industry is preparing for greater competition from China, South-East Asia and the Middle East.
Europe’s biggest chemical companies
BASF is the leading chemical company in Europe and worldwide in terms of revenues, according to statistics for 2021. Last year, the German group generated around USD 93 billion in revenue.
The British company Ineos, one of the world’s largest petrochemical giants, holds second place with revenues of 39.9 billion USD.
The Dutch company LyondellBasell with revenue of 39 billion USD is ranked third. LyondellBasell sells products in more than 100 countries and is the world’s largest producer of polymer compounds and the largest licensor of polyolefin technology.
With EasyList you can always identify the biggest companies in a specific field – just set ranges by financial metrics, and the list of companies will be generated automatically.
Competitive environment in the chemical industry
Not everything is rosy and the European chemicals industry has its fair share of challenges.
Supply chains are increasingly shifting eastwards. The key trend in the global economy is Asian growth, driven by the growing integration of regional economies around the world. The changing direction of trade flows between the Asia-Pacific region and Europe will contribute to the dominance of Eastern players.
The chemical industry is shifting towards Asia, which will account for 66% of global chemical sales in 2030 and by that time at least half of the top ten chemical companies will be based in Asia or the Middle East.
Chemical companies around the world are wasting no time in devising their regional positioning strategies for 2030. The current competitive environment suggests that European companies are well positioned in their home markets but weak in overseas markets.
How do you approach the Asian, African and Latin American markets? First of all, you should start by researching local markets:
- Are there enough active chemical importers in these regions?
- Which manufacturers have the potential to become importers of your products?
- Who are the key players in the regional markets and would they compete with your company?
You can get initial answers to these questions using EasyList, an online tool generating company lists in 26 languages, according to your specific requests and filters.
European manufacturers are most interested in China. Beijing is already highly competitive and has a government that is not shy about applying political pressure in the economy, even with multinational companies.
The NAFTA countries remain quite attractive in terms of market volume and homogeneity, but, like Europe, growth is slow here.
The rest of Asia is a relatively fragmented and highly competitive market that is less attractive than the NAFTA region. However, as with China, the rest of Asia continues to be interesting because it is home to some of the largest and fastest-growing economies, including India, South Korea, Indonesia, Singapore, Malaysia and Vietnam. Latin America, Japan and the rest of the world are at the bottom of the list of priorities for European manufacturers. These markets do not have the same growth potential as others.
Constraints on the development of the chemicals industry in Europe
As a “driver industry”, the chemicals industry plays a key role in providing innovative materials and technological solutions to support Europe’s industrial competitiveness. It is energy-intensive and under substantial competitive pressure, facing challenges such as increasing international competition, rising energy and raw material prices, pressure to improve resource efficiency, new regulations and the need to develop and innovate.
Three main factors can be identified as having an impact on the development of the chemical industry in Europe:
Access to raw materials and energy
The EU chemical industry requires fair and equal access to resources at competitive prices, as well as favorable legal and regulatory framework conditions. Although the chemical industry is showing growth, Europe’s share of global production is declining and investment in new capacities is relatively low. To encourage investment, the industry needs access to critical resources, in particular energy and raw materials, at competitive prices.
Coordination between policies
The interaction between EU industrial, climate, environmental and energy policy needs to be optimized, and a better understanding of the combined cost impacts of these policies needs to be developed.
Regulations
The chemicals sector is highly regulated with regard to health, safety and environmental protection, as well as climate change and energy issues. A stable and predictable regulatory environment for the chemicals sector is a key requirement for future competitiveness.
Factors such as changes in exchange rates, high labor costs, R&D costs, and regulatory and tax burdens can limit the development of the European chemicals industry. Global chemical sales are expected to reach EUR 6.3 trillion by 2030. By that time, the EU chemicals industry will have moved into third place behind China with 44% of the global market and the US.
How to avoid being in the last car? The challenge is obvious: start using digital tools for online prospecting right now. And Kompass EasyList is here to help you do just that.
Comentarios
No Comments