UK chemical supply chain survey unveils slowing trends

The Chemical Business Association (CBA), the voice of the chemical supply chain, has released results from its latest quarterly supply chain survey*. The survey, which is distributed to the Association’s extensive membership, contains responses from manufacturers and distributors, as well as transport and logistics companies from across the UK’s chemical supply chain.

The 2024 fourth-quarter results indicate that while the UK chemical supply chain remains resilient, growth may be plateauing, as 55% of respondents said order books remain unchanged, while only 18% specified they are improving.

This trend continues when looking at current and projected sales. Only 20% of respondents reported improved sales over the previous three months and, while this has not changed since Q3 2024, it is a 15% downturn from the same period in 2023.

With regards to future sales, only 19% are predicting an improvement for the first three months of 2025, down from 34% in Q4 2023. This, combined with 56% of respondents anticipating no changes to future sales, could be further evidence of plateauing and possibly even slowing growth.

Current sales margins further reflect this trend, with 10% fewer respondents reporting improvements compared to the same period in 2023, while 69% indicate no change. Future margin expectations also show signs of decline, with 32% of respondents expecting them to worsen in the next three months – up from 19% in Q4 2023.

The CBA’s recent trends survey also revealed slowing growth regarding employment amongst member companies. Only 4% are expecting employment levels to increase over the coming months, down from 18% in the previous quarter, and 13% in the same period in 2023. This does not however, necessarily indicate a shrinking workforce, as the majority of those who responded (84%) are expecting employment levels to remain the same.

When considering issues relating to logistics, also imports and exports, the survey shows some signs of improvement. Fewer are experiencing problems caused by the Red Sea and Suez Canal, with latest figures showing 48% of respondents are still encountering disruption, a significant reduction when compared with Q4 2023, when it was 70%.

Fewer disruptions regarding road haulage capacity are also being reported – only 3% have reported this as an ongoing issue during Q4 2024, compared with 22% in the final quarter of 2023.

Issues persist however, with members reporting disruptions caused by escalating road haulage costs, continued regulatory issues linked to Brexit, in particular (UK REACH), and wider reaching global factors.   

Tim Doggett, Chemical Business Association’s CEO said: “The chemical supply chain is a critical pillar of our society and the UK economy. It is with this in mind that I must take the opportunity to thank all our members and their employees for the amazing work they do, to ensure the chemical supply chain runs smoothly. Their efforts deserve to be celebrated.”

He continued: “This is despite events in recent years that have highlighted vulnerabilities, also dependencies, across vital supply chains, that require urgent action to be taken, to ensure the UK remains competitive.”

“Businesses do, however, face a variety of challenges. UK REACH, for example, remains unresolved since December 2021, when DEFRA announced plans to explore a new model. Meaningful progress is still absent, resulting in inertia and uncertainty that continues to stifle trade and investment. The situation is compounded, for many, by the recent Budget.”

“The CBA remains eager and ready to work with Government to address these challenges and we are committed to collaborating on practical solutions that drive growth, investment and resilience for the benefit of not only our members, but the chemical supply chain and the UK as a whole.”

“Businesses need to see action is being taken. They need effective, targeted policy intervention, otherwise the UK risks not only stagnating, but falling behind on the global stage. Moreover, as geopolitical dynamics change and evolve at an unprecedented pace, a more agile approach to counter them needs to be expedited.”

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