Log InChemical supply chain shows positive signs of strengthening
21 February 2024
Q4 Supply Chain Survey analysis
The Chemical Business Association (CBA), the voice of the UK chemical supply chain, has released results from the latest quarterly supply chain survey, which shows a cautious but growing optimism throughout the CBA membership* for the months ahead.
The most recent survey, which shows results from the final quarter of 2023, portrays a supply chain that is gradually strengthening, with 29% of respondents reporting improvements in their order books over the previous 3 months, compared with only 5% in Q3. These positive developments continue when considering sales, with 21% of respondents reporting improvements, in comparison with only 9% for the previous quarterly survey.
The survey also highlights a growing optimism and confidence within the chemical supply chain for the near term, with 38% of respondents anticipating an improvement in upcoming sales over the next three months, compared to only 5% at the conclusion of Q3. The trend continues, with 17% of respondents expecting future sales margins to improve – a huge improvement when considering that no respondents expected any improvement over the coming months, at the conclusion of Q3.
Despite an increase in optimism from the survey, when it comes to sales, order books and sales margins, employment figures largely remain the same, while some are indicating that margins will worsen. The latest results are consistent with the previous quarter, with only 15% of Q4 respondents anticipating higher employment figures over the coming three months.
The survey also however, highlights that there is little evidence companies are anticipating a reduction in employment levels in the near term, and in line with the wider Association’s activities and goals, 27% of respondents expect to provide increased training opportunities for their respective teams over the coming three months.
Despite Q3 figures reporting the global ocean freight container shortage being an issue for only 5% of respondents, the latest survey does show that the number has risen markedly to 29%. This, combined with the continuation of escalating shipping costs – 79% of respondents reported it as an issue – shows there are obstacles facing industry as a whole, particularly when it comes to import and export operations.
Tim Doggett, Chemical Business Association’s CEO said: “Following what seemed to be a general downturn and cooling in the market throughout 2023, but particularly in Q3, the latest supply chain survey does suggest a degree of increased optimism, which will hopefully continue throughout 2024. However, one significant aspect that has changed is a huge increase in the reporting of logistics issues, which is not surprising given the ongoing and very concerning situation in the Red Sea and the resulting rerouting of vessels”.
“The survey remains of vital importance to our members. It provides a clear indication of potential and ongoing issues confronting the chemical supply chain, chemical industry and industry as a whole. It shows us where best to focus our attention, not to mention the knowledge and support of the numerous dedicated partners, organisations and initiatives with which we collaborate.”
About Chemical Business Association:
The Chemical Business Association (CBA), founded in 1923, has a long and illustrious heritage in delivering for its members and is the leading organisation representing the complete chemical supply chain. Many of its members are SME’s and include manufacturers, distributors, traders, warehouse operators, logistics and transport companies, as well as service providers and suppliers who collectively are the main chemical industry interface providing products and services to virtually every sector.
Now celebrating its centenary, some founding member organisations still remain. Such a diverse membership gives the distinct advantage of a 360-degree view and insight of the global chemical supply chain which, combined with the extensive and in-depth expertise of its staff, enables the CBA to provide wide-ranging services and support to its members, and to engage and work closely with Government and other key stakeholders in the UK and overseas.
The chemicals and pharmaceutical industry is the UK’s second largest industry and is the nation’s number one manufacturing exporter, and CBA members contribute in excess of £4 billion to the UK economy and employ over 10,000 people nationwide. Chemicals are vital for society and with more than 97% of all manufactured products containing inputs from the chemicals industry, CBA members handled in excess of 27 million tonnes and make over 2.25 million deliveries of chemicals last year. Health and safety, people and sustainability are at the heart of the CBA, and it leads and participates in many initiatives such as the ‘Responsible Care Programme’ which it has been part of since 1993.
The Chemical Business Association is the voice of the UK chemical supply chain.
Note to editors:
For further information please contact:
Alf Lombardi, Shrewdd Marketing
E-mail: alflombardi@shrewdd.com
Telephone: +44 1422 363424