Just been reading about Europe's chemical sector and honestly, it's pretty grim what's happening there. The industry is literally crumbling right now, and it's not some slow decline we're talking about—it's accelerating.

So here's the scale of it: investment in European chemicals dropped 80% last year. That's not a typo. And plant closures? They've gone up sixfold since 2022. By 2025, the region had shut down 37 million tons of capacity—roughly 9% of everything Europe had. That's 20,000 jobs gone and barely any new money coming in.

Marco Mensink from the European Chemical Industry Council basically said it straight: the sector is breaking down. He mentioned the pace of closures has doubled in a year, and annual investments have nearly disappeared. Not exactly subtle language.

What's wild is how far Europe's fallen globally. Back in 2004, Europe controlled over 27% of the global chemical market. Now? It's down to 12.6% in 2024. The industry was generating over 600 billion euros in sales, but clearly that's not enough to keep the sector competitive anymore.

The root causes are pretty straightforward: energy costs are brutal since the EU lost access to cheap Russian gas, and regulatory pressure around emissions is relentless. Don't get me wrong, climate goals matter, but when you're competing against China and the US with way lower costs, it becomes impossible. Even the EU's carbon border adjustment mechanism (CBAM) hasn't really leveled the playing field.

Major players are basically giving up on Europe. SABIC sold off European assets, Dow's closing German plants, and ExxonMobil is eyeing a complete exit. A couple of chemical producers have already filed for insolvency. That's the kind of signal that tells you how bad it really is.

Here's what makes this actually dangerous: chemicals aren't just some industry. They're essential for automotive and defense sectors. If Europe loses its chemical base, those industries are going to struggle too. Mensink called it a stranglehold—the rest of the world basically has Europe dependent on chemical imports now.

Without a serious policy shift, specifically deprioritizing emission reduction relative to competitiveness, the European chemical industry probably isn't coming back. It needs immediate action from policymakers or we're looking at permanent structural damage to European industry.