German chemicals industry back on growth track

Frankfurt, Germany – The German chemicals and pharmaceuticals industry has returned to a “moderate growth”, according to the first quarter report by the country’s chemical trade association VCI.

“From January to March, production in Germany’s third largest industry was back on the increase, compared with the previous quarter – benefiting from the stable global economy and the economic recovery in Europe,” said the report.

There was a drop in chemical industry sales, said the report, adding that due to competitive pressure the companies had to adapt their prices for chemical products to the lower raw material costs.

“We are expecting the chemical business to improve further” said VCI president Marijn Dekkers.

According to Dekkers, the current low oil price, the weak euro and favourable interest rates were all contributing to the economic recovery in Germany and Europe.

But, he pointed out, these special factors have short-term effects.

“The upward trend can only last if given substance by the German federal government – with growth-enhancing reforms,” he added.

For the year 2015 the VCI is expecting an increase in chemical production by 1.5 percent. As chemical prices are anticipated to drop by 2 percent, chemical industry sales are forecasted to fall by 0.5 percent to €189.9 billion.