Biorefineries: European chemistry makes a comeback

© UPM

The European chemical industry is at a decisive turning point. Once the backbone of European industrial power, it is now under enormous pressure from structurally high energy costs, volatile raw materials markets, intensifying global competition and a wave of capacity closures the likes of which have not been seen for decades. At stake is not just an industry, but also industrial resilience, strategic autonomy, political unity and Europe's leadership role in climate protection. But in the midst of these upheavals, one path to renewal is becoming increasingly clear: biorefineries.

Europe's traditional chemical industry is no longer just dealing with an economic downturn. It is undergoing a structural decline. Since 2022, the closure of more than 10 million tons of chemical production capacity has been announced across Europe. Investment decisions are increasingly being made in favor of the United States, China and the Middle East - regions that combine competitive energy with a decisive industrial policy. The chemical sector, once a pillar of Europe's global leadership, is shrinking while its competitors are expanding.

This is not just an industry problem. Chemicals form the basis for more than 90% of all industrial goods. They are essential for clean energy technologies and low-carbon mobility, for the decarbonization of heavy industry and the production of sustainable materials in sectors such as construction, textiles, personal care, automotive and packaging. If Europe loses its chemical base, it weakens its entire industrial ecosystem.