CBA members not so upbeat

DOWN IN THE MOUTH

MARKET • CBA’S REGULAR MEMBER SURVEY SHOWS A SECTOR FEELING THE PINCH, WITH A MORE PESSIMISTIC OUTLOOK THAN HAS BEEN RECORDED IN RECENT YEARS

THE CHEMICAL BUSINESS Association’s (CBA) latest supply chain trends survey, conducted over a two-week period between 5 and 16 November 2018, reveals a sharp decline in both order books and sales, with current and future sales margins turning negative, along with a decline in employment trends from the previous survey in June.

CBA’s supply chain trends survey asks companies to provide information on order books, sales, sales margins, and employment on a ‘better-worse-same’ basis. To measure short-term trends, the analysis ignores responses answering ‘same’ and focuses on the positive or negative balance provided by the difference between the ‘better’ and ‘worse’ options.

UPS AND DOWNS Members were asked if their order books were better, worse or the same compared with the previous three months. The survey results show a positive balance of +14 per cent in current order books which represents a significant decline from the balance of +32 per cent reported in June of this year.

Respondents were also asked to compare their current sales volumes with the preceding three months and forecast the trend for the upcoming three months. The results show that current sales volumes reveal a balance of +7 per cent, significantly lower than the +27 per cent reported in June. Future sales trends – though remaining positive – also continued to lose momentum at +9 per cent, down from +17 per cent reported in the last survey.

Companies reported their sales margins, comparing current margins with the previous three months and forecasts for the upcoming three months. Current sales margins have moved into negative territory with -11 per cent compared with the +8 per cent reported in June’s survey. Respondents forecast that sales margins will remain negative over the next three months, generating a balance of -7 per cent.

Member companies were asked to report on their employment levels in the same manner, detailing whether levels will increase, decrease or remine the same. The responses reported a decline in employment trends with +16 per cent, down from +28 per cent reported in the last survey.

BIGGER REPRESENTATION CBA represents the independent chemical supply chain in the UK, including distributors, traders, warehouse operators, and logistics and transport companies. CBA’s members, the majority of which are small and medium-sized enterprises (SMEs), are the main industry interface with thousands of UK downstream chemical users. CBA member companies employ more than 8,700 individuals and distribute, pack and blend more than 4m tonnes of chemicals each year, with a market value of nearly €3bn.

CBA’s membership list continues to increase. In recent months it has welcomed Prayon UK, which describes itself as a world leader in phosphate chemistry, risk management consultant RAS Ltd, and NuStar Eastham Ltd, the main chemical terminal in NuStar Energy’s UK network of bulk liquids terminals, as new members. HCB www.chemical.org.uk