June 23, 2025 – AsiaMB Special Report: Europe’s Chemical Industry Faces Existential Crisis as Major Plants Shutter
Europe’s chemical sector is undergoing a seismic shift as INEOS Phenol announces the permanent closure of its Gladbeck, Germany facility – the world’s largest phenol production site. This 650,000-ton capacity plant, operational since 1954, will terminate its entire phenol-acetone production chain, leaving 279 employees jobless and potentially affecting 1,500 indirect positions.
The shutdown wave continues as Westlake Chemical simultaneously ceases operations at its Pernis, Netherlands complex, abandoning plans to restart allyl chloride and epichlorohydrin units. Despite EU’s 40.8% anti-dumping duties on imported epoxy resins, market prices have returned to pre-tariff levels due to weak demand.
Sir Jim Ratcliffe, INEOS Chairman, bluntly called the closures “a direct consequence of failed European energy policies,” warning this might mark the beginning of Europe’s deindustrialization. Industry analysts point to a perfect storm of challenges:
• Energy costs 3-5x higher than US/Asian competitors
• Aggressive carbon taxation policies
• Chronic demand contraction in key markets
• Uncompetitive regulatory environment
AsiaMB industry sources reveal growing concerns about potential shortages of essential chemical feedstocks, which could ripple through Europe’s manufacturing ecosystem. With no immediate policy relief in sight, multinationals are reportedly accelerating plans to shift production capacity overseas, potentially reshaping global chemical supply chains for years to come.
The closures highlight a troubling paradox – while Europe pushes for green industrialization, its policies are driving away the very industries needed to manufacture renewable energy components, electric vehicles, and other low-carbon technologies. As one executive privately told AsiaMB: “We can’t decarbonize what no longer exists in Europe.”