Outlook for the Chemical Industry

• Global growth in chemical industry remains below average

Global chemical production (excluding pharmaceuticals) is expected to grow by 1.2% in 2020, much slower than in 2019. We anticipate a slight decline in the advanced economies (2020: –0.8%, 2019: –0.9%) and growth below the prior-year level in the emerging markets (2020: +2.4%, 2019: +3.5%).

In China, the world’s largest chemical market, we are forecasting a significantly lower growth rate (2020: +3.0%, 2019: +4.7%). Weaker final demand and production stoppages in customer industries will likely have a significant negative impact on chemical growth in China. We do not expect that the drop in demand caused by the coronavirus outbreak will be able to be fully recouped over the course of the year. We assume here that the trade conflict with the United States does not intensify again.

For the E.U., we again anticipate a decline in chemical production. Due to the sharp drop in chemical production in the second half of 2019, production levels at the year-end were below the annual average. It is not likely that the recovery we are forecasting over the course of the year will be strong enough to achieve full-year volumes growth.

We expect a continued slight decline in chemical production in the United States. Growth in customer industries will presumably remain weak overall despite the slight recovery we anticipate in agriculture and the expected stabilization in the construction industry, which should support demand for chemicals.

In Japan, we are forecasting a further decline in the chemical market amid a weak domestic economy and the slowing regional environment.

After declining in the previous year, we expect a stabilization in demand for chemicals in South America, driven mainly by a slight upturn in the Brazilian market.

Outlook for chemical production 2020 (excluding pharmaceuticals)

Real change compared with previous year

Trends in chemical production 2020–2022 (excluding pharmaceuticals)

Real change compared with previous year