VCI report on the business situation of the German chemical industry in the 1st quarter 2016
Lower chemical sales, irrespective of higher production
Chemical production: increase by 2.2 percent against the previous quarter ++ Drop in chemical prices by 1.3 percent ++ Chemical sales decrease by 0.9 percent ++ Forecast 2016: chemical business remains difficult.
The German chemical-pharmaceutical industry had a mixed start in 2016, according to the latest quarterly report by the German chemical industry association Verband der Chemischen Industrie (VCI): From January to March, production in Germany’s third largest industry clearly improved over the weak previous quarter – while producer prices dropped significantly, inter alia, due to the low oil price. That led to falling chemical sales, even though industrial customers at home and abroad expanded their productions and, consequently, needed more chemicals. Moreover, in the period under review the chemical companies were adversely affected by rising pressure from imports into Germany and Europe.
VCI President Marijn Dekkers on the business situation of the industry: “Chemical business will remain difficult also in the present year. So far, the overall economic development in Germany and Europe is reaching our companies only to a limited extent. Exports to major markets – like the USA, China, Russia or Brazil – are weaker than in the previous year. Furthermore, the fall in prices continues. All this speaks against brisker business in the short term.”
For the year 2016 the VCI maintains its forecast of an increase in chemical production by 1 percent. However, as producer prices are anticipated to fall by 2 percent, chemical industry sales are projected to drop by 1 percent to 187 billion euros.
In the 1st quarter 2016, chemical production returned to the growth path – with increases by 2.2 percent over the previous quarter and 0.6 percent over the previous year. Capacity utilisation was at 83.6 percent.
As compared with the previous quarter, prices of chemical products dropped by 1.3 percent in the first three months of 2016 – to a new record low. In comparison with the previous year, chemical prices were 1.4 percent lower in the period under review.
Due to declining prices, from January to March 2016 German chemical industry sales fell for the third consecutive time. Irrespective of the stronger demand, sales dropped by 0.9 percent against the previous quarter and 3.5 percent against the previous year.
The 1st quarter 2016 saw the first drop in the number of jobs since 2009. At present, the industry has 444,000 staff, reflecting a decrease by 0.5 percent as compared with the previous year.
The full version of the VCI’s quarterly report 1/2016 (in German language), an executive summary in English, the two main charts of the report as jpg files in high resolution and an overview of the final official key figures 2015 for the German chemical industry are available in the download section at the top of this page.
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The VCI represents the politico-economic interests of over 1,650 German chemical companies and German subsidiaries of foreign businesses. For this purpose, the VCI is in contact with politicians, public authorities, other industries, science and media.The VCI stands for over 90 percent of the chemical industry in Germany. In 2015 the German chemical industry realised sales of around 189 billion euros and employed 446,000 staff.
Contact: VCI Press Dept., Phone: +49 69 2556-1496, E-Mail: email@example.com
Please note: VCI news about the chemical industry is also available via Twitter: http://twitter.com/chemieverband