Chemicals

The Chemicals industry converts raw materials into over 70,000 different products and has an impact on over 96% of manufactured goods.

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What is the current position of the chemicals industry?

In 2025, chemical industry remains under pressure, with European producers hit hardest by high energy costs, global oversupply, and ongoing facility closures. While falling gas prices offer some relief,  maintaining competitiveness remains a challenge amid strict regulatory and cheaper imports from Asia. 
Trade dynamics are shifting, easing US-China tensions are providing a temporary respite, but the potential diversion of Chinese goods into Europe could add to the challenges facing domestic producers. Emerging technologies like generative AI offer long-term efficiency and innovation gains, but energy and cost pressures continue to define the sector’s current state.
While new technologies such as industrial AI promise efficiency and innovation gains, the chemicals industry has historically been a slow mover compared to other sectors in terms of embracing digitalization. However, senior executives are growing increasingly aware of the transformative potential of disruptive technologies. By harnessing digital technologies, chemical companies can enhance their existing products and services. This presents opportunities for chemical companies to: 
– Achieve 24/7 AI powered customer service 
– Achieve proactive sales with AI based customer demand 
boost sales with data-driven R&D 
– Expand customer understanding and identify new
– Markets/applications for products 
– Improve targets 
– Utilize advanced analytics for smart maintenance and greater first-time production. 

Chemical Industry Trends & Challenges

Chemicals companies face a number of opportunities and threats to their businesses. The companies best placed to deal with a challenge will consider it as an opportunity, whilst those poorly prepared will face the challenge as a threat. These include:

  • Circularity
  • Changing customer requirements
  • Decarbonization
  • Growth of artificial intelligence
  • Sustainability

Global chemical demand varies significantly by region and is largely shaped by the location of global manufacturing hubs. Strong growth in Asia and a push towards reindustrialization in North America and Europe, means chemical companies face increasing pressure to adapt their operations and supply chains to stay aligned with key customer industries.

  • New electronics factories in China and Thailand drive growth in demand for solvents used to clean components and connectors
  • New car assembly plant in Hungary drives growth in demand for automotive paints and coatings
  • The extraction of shale oil and gas from reservoirs in the US needs chemicals to prevent the corrosion of well casings, to reduce drill-bit friction, and to kill bacteria.

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Objectives

  • Identify the industry terminology
  • Identify the relationships between typical companies in the high-tech supply chain and understand the structure of a typical business
  • Pick out some of the major issues faced by high-tech companies in today’s industry
  • Differentiate between the initiatives they take to respond to business issues

Cambashi Ltd is registered with the National Association of State Boards of Accountancy (NASBA) as a sponsor of continuing professional education on the National Registry of CPE Sponsors. State boards of accountancy have final authority on the acceptance of individual courses for CPE credit. Complaints regarding registered sponsors may be submitted to the National Registry of CPE sponsors through its website: http://www.nasbaregistry.org

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Technology

Low profit margins for chemical producers mean that there is little room for error in the manufacturing process – consistent quality is vital. So, processes in most chemical plants are run by what might be termed ‘intelligent machines’, which automatically adjust the controls to keep things running smoothly.

The systems which make the adjustments are known as Supervisory Control and Data Acquisition (SCADA) systems, and they continuously gather data in real-time from sensors, and then tell vats, valves, pumps and compressors, and other equipment exactly what it needs to do.

Chemical companies utilize specialized IT solutions that support the business initiatives being adopted by chemical manufacturers:

  • Business Intelligence (BI)
  • Document and workflow management (PDM)
  • Environmental, Health and Safety (EHS) compliance
  • Manufacturing Execution Systems (MES)
  • Supply Chain Management (SCM).

Here we can see the relative sizes of the Computer-Aided Technologies (Mechanical CAD, Mechanical CAE, CAM), PLM, BIM, and GIS software sectors in the global chemicals market. The total is worth approximately $US240 million annually. Note how BIM and MCAE are the largest segments, highlighting the importance of facilities management and engineering simulation within the chemicals sector.

Learn more about Cambashi Market Data

Design/Engineering/Manufacturing Software Market Share – Chemicals Industry

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