The UK chemical industry is complex and plays a crucial role in the economy and across all value chains. Without it, the goods upon which society depends would rapidly become scarce or simply unavailable. Although this vital industry has faced and successfully conquered several major disruptions in recent years, the effects of some issues continue unabated.
Since the UK joined the European Single Market in 1993, supply chains have developed and evolved to become highly integrated and efficient, allowing the swift and economical movement of goods, services and people throughout the EU. The lack of barriers enabled reliable ‘just in time’ deliveries, allowing businesses to maintain lower stock and inventory levels, helping both cash flow and ensuring uninterrupted and optimised operations.
However, leaving the EU has had a significant impact on the UK’s chemical supply chain. Because of the increase in administration, customs formalities and border checks, the ‘just in time’ model has changed to one of ‘just in case’, with larger consignments being shipped less frequently, and more stock being stored locally. This has impacted cash flow and has resulted in additional costs for the handling and storage of stock, as well as increased risk to buyers.
Additionally, the complex nature of the Northern Ireland Protocol has created further layers of complication. While it may have created opportunities for some companies, this has generally been due to others exiting the market because of the additional costs and administration, as well as uncertainty caused by the political disagreements between the UK and the EU over the protocol going forward.
As the effects of Brexit linger and its impact continues to be felt across the chemical supply chain, CBA remains proactive in assisting its members to adjust.
Another issue that has been at the top of the Association’s agenda is UK REACH, the implementation of which would effectively mean that tens of thousands of substances in the EU REACH database must be re-registered. The estimated cost to industry of data acquisition, registration fees and associated administration was estimated in a Department for Environment, Food and Rural Affairs (Defra) Impact Assessment to be around £2bn, and potentially as much as £3.5bn. This is on top the £500m that UK companies had already spent complying with EU REACH. There is also the real risk that it would lead to potential additional and repetitive animal testing.
CBA has been working with other affected trade associations on this issue through the Alliance of Chemical Associations (ACA). By working together, the parties have been able to give a louder voice to the potential issues that UK REACH will bring to the chemical supply chain and have consistently called for legislation to be amended to avoid the significant additional costs it will bring, as well as its potentially devastating impact on raw material availability to manufacturers in the UK and downstream users who were previously not within the scope of the regulation.
With CBA having tirelessly lobbied and led discussions on UK REACH, a breakthrough came at the end of 2021 when Defra announced its intention to investigate an alternative registration model. At the same time, they advised their intention to consult separately on extending the deadlines, with the subsequent consultation concluding in September 2022.
Following the announcement, CBA continued its efforts by providing expert advice and input to various working groups, including the UK REACH Oversight Group and Technical Working Group established by Defra. In addition, while supporting its members with online consultations and a one-to-one advice service, it hosted several UK REACH seminars and Online Clinics which, due to the importance of this issue for the industry, were open to CBA members and non-members alike.
The consultation received a significant number of submissions and, like many other stakeholders, CBA welcomed an announcement by Government in December 2022 to extend the transitional registration deadlines for UK REACH. Under this timeline, pending legislation, the submission deadlines for each tonnage band were extended to October 2026, October 2028 and October 2030, respectively.
CBA remains united with other stakeholders and industry in wanting a pragmatic and workable UK REACH solution that maintains high standards of environmental and human health and safety, and which allows the UK chemical industry and related businesses to remain competitive in the global marketplace.
To ensure the chemical industry attracts the diverse and inclusive talent pool required to maintain its position as a vital contributor to the UK economy, it must be showcased as a desirable industry in which to build a career. However, because the sector is not widely regarded as a viable career choice, the range of opportunities that exist are often overlooked.
To address this, CBA has launched various initiatives aimed at challenging perceptions about the industry and promoting the opportunities that exist not only to get the younger generation interested and involved, but also to attract talent and make the chemical supply chain an employer of choice.
Last year CBA established a Future Council, comprising young people with a diverse variety of skills and roles from member companies. In addition to promoting the chemical supply chain, encouraging future industry talent, and promoting STEM (science, technology, engineering and mathematics) education, the Future Council’s objective is to help young people enhance their understanding of the chemical industry beyond their own jobs and enable them to contribute meaningfully to industry policies. It is further aimed at engaging with Millennials and Gen Z by showcasing the diverse career opportunities within the sector and informing youngsters and educators about the important contribution science and the chemical supply chain make to the economy.
CBA is also an official partner of Generation Logistics, an industry-led campaign aimed at bringing industry together, shifting perceptions, and encouraging the next generation to optimise opportunities in the logistics industry.
Across all sectors, there is a rising demand for more sustainable business practices. However, according to UN Global Compact participants, supply chain procedures are the biggest challenge to improving their sustainability performance.
Contrary to belief, the chemical supply chain industry is focused on making considerable progress towards sustainability while reducing its impact on the environment, with many industry stakeholders proactively taking steps to making a green transition. There has been a longstanding commitment across industry to safer chemicals management, improving the environmental safety and impact of chemical supply chain processes, and seeking innovative technologies and solutions to sustainability challenges.
Although there is currently an added urgency for the chemical sector to develop sustainable strategies and strengthen net zero commitments, CBA has been pursuing these goals for years. It has been actively involved with the Responsible Care (RC) programme for three decades and last year published its vision for RC in the 21st century, with the main objective being to demonstrate to society that the chemical industry is committed to the safe and sustainable management of chemicals.
Furthermore, as the chemical industry has a key and leading role to play in decarbonisation – both as a consumer of energy and in developing sustainable solutions for the future – understanding carbon and other greenhouse gases and their role in climate change has become increasingly vital for the sector. As such, industry stakeholders are actively undertaking Carbon Literacy training. Following the certification of several CBA staff members as being Carbon Literate, it has introduced Carbon Literacy training to help its members make informed choices to reduce their carbon impact.
CBA has been the voice of the chemical supply chain for a century and will continue to use its position as a leader and influencer to help mitigate the impacts of these issues.