Discover how to enhance your technical sales strategy with pre-call planning and generative AI (GenAI).
Chemical Manufacturing
December 5, 2024
As 2025 approaches, the chemical industry is expected to accelerate its recovery in the market and continue to grow. Technical sales teams and chemical leaders must stay ahead of emerging trends to gain a foothold in the competition.
Despite prevalent uncertainties, the American Chemistry Council (ACC) predicts global chemical production will increase by up to 3.5% in 2025. What should chemical companies prepare for in the coming year? Let's explore the top developments that are shaping the industry landscape.
The chemical sector will see ongoing consolidation through mergers, acquisitions, and portfolio restructuring. Already, major players are strategically positioning themselves to capitalize on emerging opportunities.
In 2024, BASF launched a separate catalyst business, BASF Environmental Catalyst and Metal Solutions, to serve customers in the hydrogen economy. Sudarshan Chemicals acquired Heubach in October 2024, diversifying its pigment portfolio across global sites. LyondellBasell's acquisition of solvent recycling company APK also reveals the industry's focus on specialization and growth in high-potential segments. Expect more consolidation for 2025.
Chemical companies are feeling the pressure of cost increases. Feedstock and energy prices particularly remain a significant concern, with European gas prices still four times higher than in the U.S. Capacity constraints, fluctuating demand, and geopolitical factors like new tariffs under the Trump administration could also greatly impact profitability in chemical sectors. To navigate these challenges, companies must reevaluate their operations and seek innovative, cost-effective solutions to sustain momentum.
The industry is shifting toward regionalized or localized production to ensure supply chain resilience. Nearshoring and friendshoring are becoming more of a priority as companies seek to mitigate geopolitical risks, cut costs, and reduce transportation emissions. This trend brings opportunities for chemical suppliers to develop strong regional partnerships and optimize their distribution networks.
Customers are prioritizing sustainability, traceability, and ESG (Environmental, Social, and Governance) factors in their purchasing decisions, causing chemical companies to adapt their product portfolios and manufacturing processes to meet these demands. While challenging, this shift creates opportunities for innovative solutions that address environmental concerns while ensuring consistent performance.
The chemical industry has an aging workforce. As more experienced professionals retire, companies must address the potential loss of critical knowledge and skills. Attracting and retaining young talent is crucial for long-term success — but preserving expert knowledge is also necessary. Technical sales teams may need to focus on knowledge transfer initiatives and leverage solutions such as generative AI platforms to bridge the skills gap.
There’s a growing reliance on chemical distributors in the industry. Principals (suppliers) seek to diversify their distributor base to avoid being too reliant on a few partners that may be at risk of falling behind. In 2025, new opportunities arise for distributors to position themselves as experts, differentiating themselves with added services and logistics support. Smaller, more “niche” distributors also face opportunities to partner with principals who might be seeking fresh audiences.
In 2023, AI was an exciting possibility for many businesses. In 2024, companies began using GenAI for broad applications in research, sales, and product traceability. In the next few years, AI is positioned to become a necessary tool for chemical companies as the drive for efficiency and innovation grows. This time, however, its real potential is in specified applications that are useful to chemical teams.
AI-powered platforms like Nesh provide features like account planning, lead generation, industry or vertical domain expertise, and deep product knowledge to help technical sales teams improve the customer experience. The move toward data and digitization — especially with the power of AI — is going to become not only a trend, but an indispensable focus for companies that aim to thrive in the changing industry.
Sustainability initiatives continue to accelerate and the chemical industry is under pressure to adapt. In addition to sourcing more eco-friendly product alternatives, companies are investing in waste reduction strategies to move toward ESG-led circular economy goals.
Worker safety is another area of investment for chemical sectors, highlighting the social aspect of ESG. This includes updating protocols for product handling, incident reporting, and safety data sheets. Chemical sales reps can leverage ESG investments to promote products, standing out to environmentally conscious buyers.
Global political tensions continue to impact the chemical industry, affecting trade relationships and market access. In 2025, the challenge for companies to navigate complex landscapes while maintaining supply chain stability persists. As the results from the intense 2024 U.S. presidential election roll out and geopolitical conflicts continue, it will be interesting to see how the chemical industry is affected. 2025 is likely to be a year of change and stress, so companies and stakeholders should prioritize staying informed about international developments and their potential impacts.
More stringent regulations with a greater focus on environmental protection and product safety are inevitable. In Europe, the implementation of the Cross Border Adjustment Mechanism (CBAM) is going to impact carbon-intensive products. Sales teams must stay aware of these regulatory changes in each of the regions they serve and help customers navigate associated compliance challenges in the regions where they operate.
The chemical industry of 2025 will reward those who can adapt quickly and bring innovative solutions to the table. By embracing these trends and using cutting-edge sales enablement technologies, technical sales teams may position themselves as trusted advisors to their customers and drive growth for their organizations.
Moving forward, technical sales professionals can strengthen their processes:
To stay ahead in this rapidly evolving landscape, forward-thinking chemical companies are turning to advanced AI-powered solutions like Nesh Sales AI. Check out our Ultimate Guide to AI in Chemicals to learn how chemical companies are turning AI into their competitive advantage.
Download our Ultimate Guide to AI in Chemicals.
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