Dow has announced plans to close some upstream production capacity in Germany and the UK, along with others assets across its global footprint.
The decision means that in Germany, Dow’s naptha steam cracker, which has a nameplate capacity of 560,000 tpa of ethylene and 285,000tpa of propylene, located in Böhlen, along with chloral-alkali and vinyl assets in Schkopau, will shut by the end of 2027.
In addition, the basics siloxans plant, part of Dow’s Performance Materials & Coatings business, located in Barry, Wales, UK is expected to close by the middle of 2026. These closures will impact some 800 jobs. The company added that the decommissioning and demolition of the assets could continue into 2029.
Dow said that the closures build on announcements made earlier this year to support profitability in Europe, and added: “The shutdown of upstream assets in Europe will right size regional capacity, reduce merchant sale exposure, and remove higher-cost, energy intensive portions of Dow’s portfolio in the region.” The company added that the closures are expected to lead to a rise in in operational EBITDA starting in 2026.
Jim Fitterling, Dow's chair and CEO, said: “Our industry in Europe continues to face difficult market dynamics, as well as an ongoing challenging cost and demand landscape. Looking ahead we remain committed to realising the value of our incremental growth investments and enhancing profitability and cash flow through more than $6 billion in near-term cash support.”
Dow’s decision will further reduce Europe’s cracker capacity. Crackers are used to produce ethylene and propylene from naphtha or other feedstocks in an energy intensive process. The products are used in the manufacture of many everyday items. Earlier this year TotalEnergies said that it would close its Antwerp, Belgium, steam cracker by the end of 2027. The decision, the company said, was based on the “significant surplus of ethylene expected in Europe,” and a decision by a third-party user of the ethylene not to renew the offtake agreement.
In June chemicals giant Sabic announced the closure of Olefins 6 cracker, in Wilton, Teesside, UK which had been offline since 2020.
And also during June, Lyondell Basell said that it had entered into an agreement and exclusive negotiations with Aequita, a Germany-based industrial group, for the sale of select olefins and polyolefins assets and the associated business in Europe. The sites to be sold are in Berre, France; Münchsmünster, Germany; Carrington, UK; and Tarragona, Spain.
Responding to calls to support Europe’s chemical producers, the European Commission, recently announced a new Action Plan for the Chemicals Industry. The plan aims to address key challenges for industry, including high energy costs, plus what is considered by European companies to be unfair global competition - and weak demand. It will also seek to promote investment in innovation and sustainability, as well as streamlining key European Union chemicals legislation.
Further reading:
• US tariffs: Understanding the impact on the chemicals industry
• Future of chemicals industry on the agenda in discussion with European Commission
• Net zero: What progress has the chemicals industry made?
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