Eurozone chemicals production continues growing in October after Q2 crash

Author: Morgan Condon

2020/12/14

LONDON (ICIS)--Eurozone chemicals output continued to grow significantly in October, month on month, statistical agency Eurostat said on Monday.

Only Spain's output fell in October, month on month, among the eurozone 19 countries.

Chemicals output growth in the eurozone and the wider 27-country EU has continued in the latter half of the year after output crashed in the second quarter on the back of lockdowns to contain the spread of the coronavirus pandemic.

Chemicals output
(% change)
October September August July June May April
Eurozone 2.6 2.4 2.5 1.6 2.7 0.3 -7.6
Germany 5.3 2.4 1.3 3.5 2.3 -6.0 -7.7
France 7.4 6.1 0.7 -0.7 3.4 11.1 -12.6
Italy 1.5 -1.6 5.0 3.0 2.1 8.3 -11.8
Spain -0.5 4.8 -0.4 3.1 7.9 3.1 -13.2
Netherlands 5.6 1.6 0.1 3.9 2.4 -3.3 -2.2
EU 2.5 2.4 2.2 1.8 2.6 0.0 -7.9
Poland 3.4 3.2 -2.0 4.3 4.8 5.3 -13.7

Eurostat did not provide chemicals production year-on-year figures.

INDUSTRIAL OUTPUT
The trend in the chemicals sector mirrors growth in overall industrial production, increasing by 2.1% in the eurozone and by 1.9% in the EU.

Capital goods drove monthly growth in October in both the eurozone and wider EU, rising 2.6% in both areas, followed by a 2.1% rise in intermediate goods.

There was more modest monthly growth for energy and durable consumer goods at different rates in the eurozone and EU.

Non-durable consumer goods remained stable in October but fell by 0.4% in the wider EU.

While this increase marks a positive for industry, production remains significantly below the previous year, down 3.8% in the eurozone and down 3.1% in the wider EU.

Segmental production remained down on the previous year, led by capital goods dropping 8.2% in the eurozone and 7.1% in the EU.

EU 27 countries industrial output
October 2020 versus October 2019
Click on image to enlarge

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INDUSTRY HOLDS UP
Analysts at Oxford Economics said they expect industrial output to remain resilient as industry will be less affected by containment measures implemented to contain the spread of the virus in the fourth quarter.

“We expect industrial production to edge up on the quarter in Q4, contrasting markedly with a new contraction of the broad economy, and to support the bloc’s recovery in the coming months,” said Oxford Economics.

“And although industry faces some headwinds, like spill-over effects from subdued mobility and not fully recovered supply chains, we expect the manufacturing sector to expand slightly over the winter months and support the recovery.”

Front page picture: French workers at a Framatome nuclear reaction production site during a visit by President Emmanuel Macron; 8 December 
Source: Laurent Cipriani/AP/Shutterstock