Chemicals

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

Cambashi’s e-learning course and Industry Insights include more information about the Chemicals industry, alongside high-level market intelligence from our market-leading datasets.

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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

Some of the underlying trends that continue to drive the industry forward include:

Automation & Technologies:

  • growth of Artificial Intelligence
  • digitalization will aid process efficiency improvements and product innovation

Supply & Demand:

  • capacity expansion projects in under-supplied areas
  • Mergers & Acquisitions
  • competition with adjacent industries

Sustainability:

  • circular economy
  • energy transition

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.

Some of the long-term challenges chemical companies are facing include:

  • cybersecurity
  • feedstock price volatility
  • geopolitical instability
  • labor shortages
  • regulations
  • supply chain disruptions.

For more in-depth information about the Chemicals industry, check out our e-learning course and Industry Insights platform.

E-learning course & Insights Platform

E-learning course

  • Self-paced e-learning
  • CPE-approved
  • Designed for customer-facing professionals

Objectives

  • Identify the industry terminology
  • Identify the relationships between typical companies in the industry supply chain and understand the structure of a typical business
  • Pick out some of the major issues faced by Chemical 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

Industry Insights Platform

  • Tactical industry intelligence updated in real-time by industry experts.
  • The latest trends & challenges, business drivers, products & services, and technology.
  • Key players and consumer perspective
  • Industry terminology and metrics
  • Deeper knowledge across a variety of industry subjects

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Chemical Industry Related Professions

In the chemicals industry, employment is diverse and segmented across various roles and regions. Managers & Supervisors typically oversee strategic planning, operations management, and regulatory compliance. These positions are prevalent in developed regions such as North America, Western Europe, and parts of APAC where companies often have complex organizational structures and stringent regulatory environments. In emerging markets like Central Asia, the demand for managerial talent is also growing rapidly as companies expand and modernize their operations.

Professionals and semi-professionals, including chemists, engineers, and researchers, constitute another significant segment of the industry’s workforce. They are involved in product development, research and development, quality control, and technical support. This group is particularly prominent in regions with strong research and innovation ecosystems. Emerging economies are also investing heavily in building their scientific and technical expertise to compete globally.

AEC & MFG Workers form the backbone of manufacturing operations, performing tasks such as production, maintenance, and logistics. These roles are prevalent in regions with a concentration of chemical plants and industrial clusters, such as China’s industrial heartland in the Pearl River Delta. However, automation and digitalization are increasingly impacting these roles, leading to a shift towards higher-skilled and technology-driven positions across all regions.

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Engineering Software Market in the Chemicals Industry

Manufacturing technology has grown exponentially over the past two decades, as industry sectors have adopted methods aimed at reducing material and labor costs, whilst increasing productivity, efficiency, and quality. The industry’s spend on software has grown consistently each year from 2020–2024.

The pandemic in 2020 disrupted the entire global economy, this led to production shutdowns and negatively affected consumer demand. Chemicals companies faced financial constraints during this period since many of the industries they serve were not producing at the level they used to, or in some cases, not producing anything at all! Consequently, there was a business critical need to streamline operations and improve efficiency.

The rebound in spending on technical software in 2021 was likely the result of companies prioritizing investments in technology to catch up with postponed projects, to adapt to new market conditions, and to increase their own operational efficiency amid tight financial conditions.

This upward trajectory in software usage reflects the industry’s recognition of the transformative potential of Big Data. The adoption of these technologies is not merely a response to industry trends but represents a proactive shift towards data-driven decision-making.

The CIO is responsible for the selection and integration of software solutions, while the VP Engineering (CTO) oversees the technological innovation driving operational efficiency. Metrics that they will use to monitor success include Software Integration Efficiency, System Uptime, and Technological ROI. These metrics enable them to assess the seamless integration of software tools, the reliability of technological infrastructure, and the value generated from technology investments.

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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