In the latest survey of business prospects for the chemical industry, optimism remains high. Over half of the companies expect sales to increase and there is a renewed appetite for investment. The survey was carried out in March by the industry’s trade body the Chemical Industries Association.
The percentage of companies expecting sales to increase (55%) is the highest for two years, with only 6% predicting a decline. On jobs a quarter of the companies expect equal numbers, half no change and a quarter a decrease.
There is further good news on research & development expenditure (critical to a UK presence) with almost 90% saying will hold steady or increase. Projected capital investment plans reflect the buoyant trading expectations: 40% intended to increase spending, 45% to maintain levels, and only 15% think there will be lower spending.
On planned investment, 39% said it was for capacity expansion, 16% for improving raw material and energy efficiency, 13% to raise environmental standards, and 32% for general maintenance and refurbishment.
When asked if planned spending would increase their business rates liability. Fewer than 20% said it would, and in none of these cases had the investment decision been affected.
Steve Elliott, chief executive of the Chemical Industries Association said “ This latest set of results show that business leaders across our sector are optimistic in what remains a very challenging trading environment. The cost and security of energy have been a major barrier to our companies. While we welcome the latest announcements in the Budget, the UK has to continue working harder to compete in a global playing field”.
He continued “I hope and believe we have turned the corner and as UK chemical investment comes on stream we can again show the world what we can do”.