The Chemical Business Association (CBA), the voice of the chemical supply chain, has released results from its latest quarterly supply chain survey*. The survey, which is distributed to the Association’s extensive membership, contains responses from manufacturers and distributors, as well as transport and logistics companies from across the UK’s chemical supply chain.
The second-quarter results for 2025 indicate cautious optimism in some areas, with almost a third (31%) of respondents specifying that their order books are improving. This is an improvement compared to Q1, when the figure was closer to a quarter (23%).
In terms of current sales, 29% of respondents reported improved sales over the previous three months. However, this marks a slight downturn compared to Q1 (32%). Looking ahead, 26% of companies predict increased sales in the coming months – just 1% higher than in Q1 – suggesting relatively flat forward momentum.
Current sales margins remain under pressure, with only 9% of respondents reporting improvements, while 60% indicated no change. Future margin expectations also show signs of decline, with nearly 37% of respondents expecting them to worsen in the next three months. This is up 10% compared to the same period last year.
The trends survey again highlighted employment concerns. While 14% of respondents are expecting employment levels to increase over the coming months, up from 11% in Q1, 20% are expecting employment levels to decline, reflecting the pressures businesses are currently facing.
In terms of logistics, a significant number of companies (77%) reported an escalation in shipping costs. Disruption linked to the Red Sea/Suez shipping routes also continues to affect operations, now impacting 57% of respondents, up sharply from 36% in Q1. However, UK road haulage issues appear to be easing, with only 8% reporting difficulties versus 16% earlier in the year.
While ongoing geopolitical uncertainty – including US/China trade tensions – adds to the list of headwinds, Brexit-related regulatory issues, particularly UK REACH, remain the most persistent and disruptive concern.
Tim Doggett, CBA’s CEO said: “This quarter’s data reflects a sector showing resilience, but which is increasingly being worn down by policy delays and global instability. The growing number of businesses expecting to reduce staff is also troubling. Without strategic support, there is a real risk of losing the skilled workforce essential for the sector’s future.
“What is most striking, however, is the resounding message from our members about the impact of UK REACH. The proposed further extension of the UK REACH registration deadlines is deeply frustrating for our members and for the wider sector as these delays prolong uncertainty, hinder investment, and continue to place unnecessary financial and operational burdens on businesses.”
The CBA, which has been the voice of the UK chemical supply chain for over a century, has been working tirelessly to make Government aware of the impact of UK REACH, not only on the chemical supply chain and the wider chemical sector, but also on downstream users who were previously not in scope of the regulation. The Association has persistently lobbied the Government on the UK REACH’s operability and practicality and the impact of duplicate testing and costs.
Doggett added: “The repeated extensions suggest a lack of direction and urgency. What the sector urgently needs is clarity, commitment, and a workable, long-term solution. Without it, we risk stalling a sector that is vital to the UK’s economic resilience.”
*The survey sample polled 35 members.
