Market evolution: Industrial gases (CN 2804) — 2015–2025

Introduction

This report analyses the evolution of EU external trade in CN 2804 — Hydrogen, rare gases and other non-metals over the period 2015–2025. The product heading covers a diverse range of industrial and specialty gases (hydrogen, argon, oxygen, nitrogen, neon, krypton, xenon) as well as non-metallic elements such as silicon, phosphorus, boron, and selenium. It is a bundling heading comprising eleven six-digit subheadings, each with distinct market dynamics.

The period under review was marked by three major developments: a structural deterioration of the EU's trade balance, a dramatic cycle of price turbulence centred on 2021–2022, and a significant reorientation of trade partners. EU domestic production grew in value (+117.2%, from €4.34 billion to €9.42 billion) and moderately in volume (+14.7%, from 48.4 billion kg to 55.6 billion kg), yet the trade position weakened substantially. Exports declined from €1.26 billion to €1.14 billion (−9.8% by value), while imports rose from €1.32 billion to €1.57 billion (+19.1%), transforming a near-balanced market into one with a €431 million deficit.

1. A Widening Deficit: How the EU Lost Its Trade Balance

1.1 Diverging import and export trajectories

Over the decade, EU imports and exports followed strikingly different paths. While exports contracted in both value (−9.8%) and volume (−10.8%, from 252,570 tonnes to 225,221 tonnes), imports expanded in both dimensions: +19.1% in value and +9.7% in volume (from 590,195 tonnes to 647,200 tonnes). This divergence widened steadily after 2022, when the post-crisis normalisation hit exports harder than imports.

The trade balance, which stood at −€55 million in 2015 (near equilibrium), deteriorated to −€431 million by 2025. The deficit briefly turned into a surplus of €303 million during the 2022 polysilicon price boom, before collapsing as that cycle reversed. Over the period as a whole, the EU's net import reliance shifted from −0.2% (slight net exporter status) to +1.6%.

1.2 The polysilicon-driven export decline

The single largest factor behind the export contraction was the boom-and-bust cycle in high-purity silicon (CN 280461, ≥99.99% Si), the EU's most valuable export segment. This product, dominated by European polysilicon producers such as Wacker Chemie, accounted for the majority of EU export value throughout the period.

Polysilicon export value peaked at €2.02 billion in 2022 — when a global solar supply-chain crunch drove prices to €31,135 per tonne — before falling back to €766 million in 2025. Export volumes declined even more steeply, from a peak of 64,804 tonnes in 2022 to just 26,075 tonnes in 2025 (−60%), suggesting a genuine loss of market share to Chinese producers who massively expanded capacity over the same period. This single segment's swing of roughly −€1.25 billion from peak to trough accounts for the lion's share of the EU's overall export decline.

1.3 Production growth was insufficient to offset the trade shift

EU domestic production of industrial gases and non-metals expanded meaningfully over the period: production volume grew by 14.7% and production value more than doubled (+117.2%), reflecting both higher output and substantially higher prices. Nevertheless, the trade intensity of the sector increased dramatically, indicating that trade became a far more significant component of the EU industrial gas market. The most specialised EU producers — notably the Netherlands (RSCA 0.35), France (0.31), and Belgium (0.24) — maintained their competitive positions, but overall the sector's external dependence increased.

2. Turbulent Prices: The 2021–2022 Shock Cycle

2.1 A polysilicon supercycle and its correction

The most spectacular price event of the decade was the export price shock to China in 2021, with an abnormality score of 118.6 — by far the most statistically extreme event detected. EU export prices to China surged by 128.5%, driven by a global polysilicon shortage as solar panel demand outstripped supply. This shock affected 79.3% of EU export value to China in that year. Prices continued climbing through 2022 before correcting, though by 2025 export prices to this segment remained elevated above pre-boom levels (€29,373/t vs. €12,040/t in 2020).

The polysilicon boom temporarily turned the EU into a major net exporter: in 2022, the overall trade balance reached its best point at a surplus of €303 million, and total EU exports peaked at €2.51 billion. The subsequent correction erased these gains entirely.

2.2 The energy crisis: Norway and Kazakhstan import shocks

Two further price shocks were detected on the import side in 2022, both linked to the European energy crisis triggered by the Russia–Ukraine conflict:

• Norway: Import prices surged by 102.7% (abnormality 25.0), affecting 45.0% of EU import value from Norway. Norway is the EU's single largest import source for industrial gases, and the price spike reflected the broader European energy cost inflation. Norwegian industrial gas production, while hydro-powered, is energy-intensive; rising electricity opportunity costs and surging demand from EU buyers combined to push prices sharply higher.

• Kazakhstan: Import prices rose by 53.6% (abnormality 37.6), affecting 15.1% of import value. Kazakhstan supplies raw materials including metallurgical-grade silicon and phosphorus; the shock reflected both commodity price inflation and logistics disruptions.

2.3 Rare gas import values more than doubled

Beyond the headline shocks, one of the most sustained price trends was in rare gases excluding argon (CN 280429: neon, krypton, xenon, helium). Import values in this segment nearly 2.5-fold, from €194 million in 2015 to €481 million in 2025. Import prices per tonne rose from €39,289 to €34,015, but the real driver was a shift in product mix toward higher-value specialty gases (krypton, xenon) used in semiconductor lithography and lighting. By 2025, rare gases had become the EU's single most valuable import sub-segment by value, overtaking low-grade silicon. The volatility of import flows from key suppliers was notably high: Russia (coefficient of variation 0.43) and the United States (CV 1.32) showed the most erratic supply patterns.

3. Shifting Partners: Diversification, Decline, and the Hydrogen Signal

3.1 Export markets: away from China, toward new frontiers

The most consequential geographic shift in EU trade was the halving of exports to China, from €531 million in 2015 to €256 million in 2025 (−52%). This was driven almost entirely by the polysilicon segment, as Chinese domestic producers (Tongwei, Daqo, GCL, Xinte) expanded rapidly to capture solar supply-chain demand. Exports to Norway also contracted sharply (−67%, from €41 million to €13 million), while exports to the UK, the EU's largest single-country destination, declined by 25%.

Against these declines, several markets grew strongly:

The concentration of EU exports, as measured by the Herfindahl–Hirschman Index (HHI), fell from 2,156 to 1,186 (−45%), indicating a substantial diversification of export destinations. Whereas in 2015 exports were heavily concentrated on China and a few European neighbours, by 2025 they were spread more evenly across a wider set of markets.

3.2 Import sources: Norway consolidates, Brazil and Serbia emerge

On the import side, the geographic picture was more stable but with notable shifts. Norway remained the dominant supplier, with import values growing from €331 million to €370 million (+11.8%), though this masks a peak of €772 million in the crisis year of 2022. Kazakhstan held steady at around €126 million.

The most dynamic changes were the emergence of Brazil and Serbia as import sources, and the retreat of the United Kingdom and China:

Brazil's growth likely reflects expanded imports of phosphorus and silicon, while Serbia's emergence aligns with its growing role in European industrial supply chains. The UK decline is partly a post-Brexit structural effect. Import concentration (HHI) remained relatively stable, rising slightly from 1,361 to 1,424 (+4.6%), as the loss of China and UK was offset by gains from more diverse emerging suppliers.

3.3 Inside the EU: Germany weakens, Denmark and Czechia surge

Among EU member states, Germany remained the overwhelmingly dominant trader — but its position weakened. Germany's exports fell from €1.07 billion to €788 million (−26%), largely due to the polysilicon contraction affecting Wacker's operations. Germany's imports also declined slightly (−8%, from €564 million to €517 million).

Several smaller member states saw dramatic growth in their trade positions:

Denmark's extraordinary export growth and Czechia's import surge suggest significant new capacity or trade routing through these countries. France and Belgium, both classified as specialised producers in this sector, continued to expand their external trade footprints.

3.4 The hydrogen signal: a 2025 anomaly

One of the most striking features of the 2025 data is the sudden emergence of hydrogen imports (CN 280410). Throughout the period 2015–2024, hydrogen imports were negligible — typically a few hundred tonnes per year, worth less than €4 million. In 2025, the reported volume surged to 57,475 tonnes while value reached €6.8 million, implying a unit price of just €118 per tonne (compared to over €8,000 per tonne in 2024). This dramatic shift — where volume increased roughly 189-fold but value only 2.7-fold — may reflect a methodological reporting change, a reclassification of flows, or the first signs of large-scale low-purity hydrogen trade entering EU customs statistics. While the absolute values remain small relative to the overall CN 2804 trade, this discontinuity warrants monitoring as it may foreshadow the EU's growing engagement with the hydrogen economy under the REPowerEU and European Hydrogen Strategy frameworks.

Conclusion

The EU's trade in industrial gases and non-metals (CN 2804) underwent a profound transformation between 2015 and 2025. Three interlinked dynamics defined the period:

1. Structural balance deterioration: The EU shifted from near trade parity to a €431 million deficit, driven by declining polysilicon export competitiveness and rising import costs for rare gases and raw materials.

2. A dramatic price cycle: The 2021–2022 period saw extreme price volatility across the sector — a polysilicon supercycle, energy-crisis-driven import shocks from Norway and Kazakhstan, and sustained rare gas price inflation. While prices partially normalised, the trade balance did not recover to its pre-crisis trajectory.

3. Geographic reorientation: EU exports diversified significantly (HHI declining by 45%), moving away from a China-centric model. Import sources became somewhat more varied, with Brazil and Serbia gaining share as traditional suppliers like the UK and China receded.

The emergence of hydrogen imports in 2025, however tentative, hints at a potential new chapter in EU industrial gas trade. Whether this signals the early stages of a genuine hydrogen import market or merely a data artefact will become clear in subsequent years. What is already evident is that the EU's position in global industrial gas trade has shifted from one of relative strength — anchored by polysilicon exports — to one of growing import dependence, with implications for both industrial competitiveness and strategic autonomy.