2024 Challenges & Opportunities For The UK Coatings Sector

Tom Bowtell, Chief Executive Officer of the BCF, has given his thoughts on the challenges and opportunities for the coatings sector in the year ahead. 

New Year is a time to look back and a time to plan ahead: reflect and resolve. What are the opportunities waiting to be seized, and what are the challenges to be overcome? 

2024 has the potential to be a good one for the UK Coatings Sector and for the British Coatings Federation. A number of plot lines are coming towards a resolution and plans are in place to build not just over the coming year, but beyond. There are a whole host of individual events and policies which could be discussed, but here are some of the key macro events and issues to watch out for. 

UK chemicals policy and regulation
Finally, three years after leaving the EU and with the original transitional registration model consigned to the dustbin, we shall see some firm proposals for UK REACH. This follows sustained lobbying from industry, including the BCF in the vanguard, to come up with a system that was more proportionate and cost-effective but still maintains high standards of protection for human health and safety and the environment. There are two public consultations expected in Q1 of 2024. The first, on UK REACH fee levels, should come later this month. It will be followed, more significantly, by a more detailed consultation on the form of the ATRm in late February or maybe March. It will be important for BCF to engage with members ahead of responding to the consultation, so please keep an eye out for communications on this issue. We are also expecting to see the publication of the UK’s own chemicals strategy at some point this year.

UK General Election
What happens with the results of the REACH consultations is not clear, however, as we may have change in Government by the end of the year. Whether the election will be held in May (options seem to be being kept open) or possibly October to allow more time for polls to shift remains unclear though. A major part of BCF’s work will be to continue to build relationships with Parliamentarians, both in the current parliament and the future one. We will build on our communications strategy and work harder to explain to policy-makers and key political stakeholders just what the coatings sector is and why it is so important to the economy. Building those relationships is important as the more people know about us as an industry the easier it should be to argue our case on key policy issues like UK REACH. 

European Parliament Election 
Importantly, there are also elections taking place for the European Parliament this year too. Most BCF members are exporters and the EU is our major trading partner, meaning what happens in the EU affects most of our members in the UK too. It looks like changes to EU REACH have been delayed until after the EU elections, although there are no major changes expected from what has been proposed so far. But the next EU Parliamentary term will also see the further development of regulations on chemicals including significant and potentially damaging new rules on font sizes on packaging, more legislation around sustainability and the environment, and on consumer rights and online sales, all of which will almost certainly impact on the UK in some way, shape or form. BCF continues to work closely with our sister European Trade Association, CEPE, on all these points.

Worldwide factors
And then there are the factors outside of domestic control. We are already seeing tensions in the Red Sea affecting container traffic through the Suez Canal. Shares in shipping companies have started to rise as increased shipping costs are forecast in the near future. Whilst this probably will not be as bad as during the Covid pandemic it is a cost companies could do without, just as many other price factors were starting to stabilise. Indeed, the ongoing wars in Ukraine and in Gaza may see renewed pressures on energy prices and these, in turn, could be disrupted still further depending upon the outcome of the US Presidential Election in November. 

Economic Forecasts
Whilst 2023 was not a great year in terms of the economy, it turned out better than forecast, with no technical recession. The predictions for 2024 seem to imply flatline growth across the year before things start to improve from 2025 and beyond. This is true in terms of GDP growth but also in sales and optimism data from Make UK when looking at the domestic manufacturing base. There is an early UK Budget being held on 6th March although a single fiscal event seems unlikely to change the economic outlook on its own. Some policy stability is much needed to smooth things over, although with so many electoral and external factors converging this year, it seems increasingly unlikely that policy stability is what we will end up with.

Source : Tom Bowtell, Chief Executive Officer of the BCF

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