LONDON — July 31, 2026 — On 29 July 2026, the Environment Agency declared half of England officially in drought following an extended period of exceptionally low rainfall and repeated heatwaves. Seven regions are now in drought status: East Anglia; Hertfordshire and London; the Thames Valley; Hampshire and the Isle of Wight; Devon and Cornwall; the West Midlands; and Wessex.

July 2026 Environment Agency Drought Data

Drought Indicator	Exact Text Data
Regions in Drought Status	7 Regions (East Anglia, Hertfordshire and London, Thames Valley, Hampshire and the Isle of Wight, Devon and Cornwall, West Midlands, Wessex)
July 2026 Rainfall (England Average)	7% of long-term average
July 2026 Rainfall (Southern England)	Down to 1% in parts
River Classification (Below Normal or Lower)	Around 78% of England's rivers
Rivers at Exceptionally Low Levels	One in six rivers
National Reservoir Storage	72% (around 9.5% below long-term average)
Temporary Use Bans Coverage	Affecting ~23 million customers (~40% of England's population)
Restricted Water Companies	Affinity Water, Anglian Water, Cambridge Water, Southern Water, South East Water, Thames Water, South West Water

The drought is placing severe pressure on the UK chemical sector. The Chemical Industries Association reported in early 2026 that UK chemical businesses face energy costs reaching 400% higher than in the United States and 150% above the European Union. The workforce is almost 10% lower than in 2023, with a third of chemical businesses expected to downsize employment numbers in the following 12 months.

Against this backdrop, demand for water treatment chemicals has intensified. The Environment Agency has increased monitoring and enforcement activity, including tighter control of water abstraction from rivers and groundwater, additional compliance checks, and operational measures to support public water supplies.

Chemical & Agricultural Industry Constraints

Sector / Context	Stated Fact from Release
UK Chemical Energy Costs	400% higher than US; 150% above EU
UK Chemical Workforce	Almost 10% lower than in 2023
Chemical Industry Downsizing Expectation	One-third of businesses expect to downsize employment in next 12 months
Environment Agency Operations	38 fish rescue operations undertaken this year
Agricultural Abstraction Restrictions	More than 1,500 licence restrictions introduced
Long-Term Water Infrastructure	Government developing 9 new reservoirs

Caustic soda flakes are widely used for pH adjustment in water and wastewater treatment. With reservoir levels depleted and river flows at historic lows, water utilities are relying more heavily on chemical treatment to maintain potable water quality and to treat effluent before discharge. The Environment Agency has undertaken 38 fish rescue operations this year, relocating hundreds of brown trout, juvenile salmon, bullhead, grayling, and lamprey from watercourses where oxygen levels and flows have fallen to critical levels.

Agriculture is also feeling the strain. More than 1,500 abstraction licence restrictions have been introduced because of low river flows, while demand for irrigation remains high and farm storage reservoirs are declining rapidly. The UK salad sector season has ended earlier than normal, forcing reliance on imports.

The second consecutive summer drought signals a structural shift in UK water resilience. The government is developing nine new reservoirs to secure long-term supply, but in the immediate term, the pressure on water treatment infrastructure and the chemicals that sustain it has never been higher.

Disclaimer: The market data and figures presented in this article are based on publicly available trade statistics and industry estimates as of July 2026. They are provided for informational purposes only and do not constitute investment or trading advice. Actual figures may vary.