Hungarian Chemical Industry Association (MAVESZ) regularly provides industrial data to member companies to characterize both international and domestic chemical industry activities. Primary source of data within Hungary is Central Statistical Office database, while international trends can be discerned from the Eurostat database and CEFIC analyses.
The information received by MAVESZ is summarized and presented to its member companies in a concise form. These include production, sales, and employment data to help member companies track and understand industry trends. Knowledge of industrial data contributes to making economic decisions.
In addition to Hungarian data, international datasets play an important role in the functioning of Hungarian chemical industry, as it is deeply integrated into the world and primarily into the European Union’s chemical industry. This is evident in the fact that nearly two-thirds of Hungarian chemical production is exported, mainly to the EU market. Interested parties can access data through our annual reports, regular newsletters, and our website.
SALES AND EMPLOYMENT IN THE CHEMICAL INDUSTRY
In 2020, total domestic chemical industry sales, including net revenues from oil refining, production of chemical substances and products, pharmaceuticals, and production of rubber and plastic products, amounted to 5,594 billion HUF. This represents a 6.7% decrease in comparable prices compared to previous year.
This comprised approximately 17.2% of the entire domestic manufacturing industry’s net revenues, with 23.5% of the manufacturing industry’s domestic sales and 14.9% of export sales coming from chemical products. Both metrics demonstrate the continued significant presence of the chemical industry within the manufacturing sector.
Within full chemical industry spectrum, net revenues and volume indices of individual industries in 2020 were as follows:
| Total Net Revenue of Industrial Activity (Billion HUF) | Volume Index (Previous Year = 100.0%) | |
| Oil Refining | 1 085 | 86,6 |
| Manufacture of Chemicals and Chemical Products (Chemical Industry): | 1 633 | 98,3 |
| Pharmaceutical Manufacturing: | 956 | 101,8 |
| Manufacture of Rubber, Plastic, and Other Non-Metallic Mineral Products: | 1 920 | 89,5 |
Source: KSH Information Database
Chemical industry plays a key role within the manufacturing sector, particularly in production of basic materials such as plastic. Additionally, the sector involves the production of organic and inorganic chemical raw materials, fertilizers, agrochemical products, paints, coatings, cleaning agents, and industrial gases.
One noteworthy aspect is the mention of Hungary’s akrilonitrile-based carbon fiber production, which has a net revenue of approximately 60 billion HUF and is European market leader. This falls under the statistical classification of “non-metallic mineral products.”
EMPLOYMENT AND WAGES IN THE CHEMICAL INDUSTRY
As of time this report was written, based on available data for the first three quarters of 2020, number of employees in chemical companies producing chemicals and products increased by 1.8%, totaling 15,350 employees. Gross average wages for blue-collar workers exceeded the previous year by 13.8%, while white-collar workers’ wages exceeded the previous year by 10.7%.
Wages were highest in the production of organic chemicals and plastic raw materials, while the lowest wages were in the production of personal care products. On average, employees in the manufacture of fertilizers and nitrogen compounds, agrochemical products, paint, and industrial gas production, as well as cleaning product manufacturing, earned above industry averages.
Chemical industry faces permanent labor market challenges, including the scarcity of labor supply, especially in skilled worker/technician segment, low interest in middle-level education institutions that provide chemical and chemical industry education, and a relatively low interest among young people in the chemical industry.
The report also mentions MAVESZ’s efforts to support programs that promote the interest of young people in chemical industry to address the issue of workforce supply.
Sales Data of Chemical Industry by Subsectors in 2020 (Companies with more than 4 employees)
Forrás: KSH Tájékoztatási Adatbázis
COVID-19 – Hungarian Chemical Industry Response: Public Commitments, Donations
Information brochure on the steps taken by MAVESZ and its member companies to combat the pandemic, their public commitments, and donations.
European Chemical Industry Council (CEFIC): Industry Response to COVID-19
European Chemicals Agency (ECHA): Information on Deadline Extensions for Businesses – May 4, 2020
CEFIC/McLarty Global COVID19 Tracker Chemical Industry : General and Chemical Industry-Related Pandemic Information – As of September 3, 2020
CEFIC: Biocidal Derogation by Country – March 30, 2020
Industrial Production in Hungary in 2019
In 2019, compared to the previous year:
Industrial production increased by 5.4%, following a 3.5% growth from previous year. Within this, output of the manufacturing industry increased by 5.5%, energy production by 1.1%, and low-weight mining by 20.1% compared to 2018.
Manufacturing industry generated nearly 33,000 billion HUF of production value in 2019 at constant prices. Production volume exceeded the previous year’s levels in all but two months. The most significant growth was observed in July (12.2%). Among thirteen sub-sectors of manufacturing industry, three experienced a decrease in production volume, while others registered volume increases ranging from 1.4% to 14.3%. Among the three largest sub-sectors, automotive manufacturing output increased by 9.8%, followed by computer, electronic, and optical product manufacturing at 6.8%, and food, beverage, and tobacco product manufacturing at 5.2%.
Industrial exports were 6.3% higher than previous year (2018 witnessed a 1.6% volume increase).63% of total industrial sales and 72% of manufacturing industry sales came from export markets. Export sales in manufacturing industry increased by 6.2% compared to the previous year. More than half of export sales came from two sub-sectors: automotive manufacturing, with a volume increase of 11.4%, and computer, electronic, and optical product manufacturing, which grew by 8.4%.
Domestic sales in the industry increased by 5.3%, and within that, manufacturing industry sales increased by 6.7%. The most significant increase in domestic sales was recorded in food, beverage, and tobacco product manufacturing sub-sector, with 2.8% growth. The second-largest sub-sector, rubber, plastic, and other non-metallic mineral product manufacturing, experienced a 6.7% increase in domestic sales.
Production increased in all regions of Hungary, with highest growth in the Pest region (10.1%) and lowest in Northern Hungary (0.1%).
HUNGARIAN CHEMICAL INDUSTRY PERFORMANCE IN 2019
In 2019, total Hungarian chemical industry sales – including net revenues from oil refining, production of chemicals and chemical products, pharmaceutical manufacturing, and production of rubber and plastic products – amounted to 7,055 billion HUF, reflecting an 8.5% increase compared to previous year.
Approximately one-fifth of total revenue of Hungarian processing industry, 19.9% of domestic sales within manufacturing industry, and 16.9% of export sales of chemical products. These figures underscore significant weight of chemical industry within manufacturing sector. Within the statistical spectrum of “full” chemical industry, net revenue and volume index for specific sectors in 2019 were as follows:
| Total Net Revenue of Industrial Activity (Billion HUF) | Volume Index (Previous Year = 100.0%) | |
| Oil Refining | 1 582 | 100,9 |
| MANUFACTURE OF CHEMICALS AND CHEMICAL PRODUCTS – CHEMICAL INDUSTRY | 1 630 | 94,8 |
| Pharmaceutical Manufacturing | 915 | 106,2 |
| Manufacture of Rubber, Plastic, and Other Non-Metallic Mineral Products | 2 928 | 103,0 |
In the narrower sense of the chemical industry – production and sales of chemical substances and products – raw materials represent the largest share. Among these, nearly two-thirds of net revenue in this sector comes from sale of plastic raw materials produced by petrochemical industry. Moreover, the industry also plays a significant role in terms of organic and inorganic chemical raw materials, fertilizers and agrochemical products, paints and coatings, cleaning agents, and industrial gas production.
It’s worth noting the mention of Hungarian production of acrylonitrile-based carbon fibers, which has a net revenue of approximately 60 billion HUF and is market leader in Europe. This falls under the statistical classification of “non-metallic mineral products.”
EMPLOYMENT IN CHEMICAL INDUSTRY
Regarding employment and wages in 2019, number of employees in chemical industry increased by 1%, reaching 15,000 employees. Gross average wages exceeded previous year by 16.4% for blue-collar workers and 7.9% for white-collar workers. However, significant differences were observed among various sub-sectors.
Key labor market challenges affecting chemical industry include a limited labor supply, especially in skilled worker/technician segment, low interest in middle-level educational institutions providing chemical and chemical industry education, a lack of comprehensive knowledge about chemical industry, and a lack of enthusiasm among young people for the chemical industry.
Considering these challenges, MAVESZ incorporated efforts to support member company programs aimed at fostering interest among young people in the chemical industry and addressing the issue of workforce supply.
Wage trends within chemical companies reflected not only their need to adapt to labor market conditions but also their efforts to retain skilled workers. In 2019, average gross wages in the industry exceeded national industrial and economic averages, with blue-collar workers earning 27% more, and white-collar workers earning 20% more than industry average.
Highest wages were observed in the production of plastic raw materials, while lowest were in the production of personal care products. Above-average wages were recorded in the production of organic and inorganic raw materials, agricultural chemical products, and industrial gas manufacturing.
FUTURE OUTLOOK
As producers of products used across all sectors of national economy, growth potential of Hungarian chemical industry is fundamentally and directly influenced by global economic, European, and domestic economic trends.
According to European Chemical Industry Council (CEFIC), chemical companies operating in EU member states did not anticipate significant growth in 2020. Global trade tensions and conflicts, as well as the cautious behavior of both investors and consumers following Brexit, contributed to this outlook.
However, the worldwide outbreak of the coronavirus pandemic at the beginning of 2020, which also spread to Europe and Hungary, and precautionary measures taken as a result, fundamentally altered previously less optimistic expectations. At the time of writing this report, economic and social consequences of the pandemic, as well as its mid- and long-term effects on the industry, are yet to be fully assessed.
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