Strong growth for chemistry in the last quarter 2017

The year 2017 ended with an unexpectedly strong 4th quarter for the chemical-pharmaceutical industry, according to the latest quarterly report published by the German chemical industry association Verband der Chemischen Industrie e. V. (VCI). From October to December, the production increased in all sectors of Germany’s third largest industry. Producer prices rose slightly. In consequence, there was almost a two-digit sales increase, compared with the 4th quarter 2016. Sales improved not only at home in Germany where mainly industrial customers ordered more chemical products. Business was very good in Europe and Asia too. The strong final quarter brought a positive overall picture for 2017. Growth dynamics in production and sales were clearly higher than in the past years.

VCI director-general Utz Tillmann on the situation of the industry: “Speaking in metaphors, chemistry started with tailwind in the new year. Companies are expecting good business to last in 2018. However, better conditions are needed for innovation and investment, so that the industry can remain competitive. Important elements for this are fiscal incentives for research and an alternative funding of the energy transition – or Energiewende.”

Forecast

For 2018, the VCI anticipates strong production growth by 3.5 percent. Chemical prices are likely to rise by 1 percent. Thus, industry sales should go up by 4.5 percent to well over 204 billion euros.

Production

In the 4th quarter 2017, chemical production improved by 2.8 percent over the previous quarter and 7.3 percent over the previous year. At 85.1 percent, the capacity utilisation of plants was for the fourth consecutive time above the average of many years.

Producer prices

After a minor drop in the 3rd quarter 2017, the prices for chemical products were back on the increase from October to December. They went up by 0.3 percent against the previous quarter and 2.7 percent as compared with the previous year.

Sales

In the 4th quarter 2017, the industry’s sales climbed by 2.6 percent against the previous quarter and amounted to 46.3 billion euros. Thanks to the good situation of industry at home and abroad and the stronger demand for chemical products, sales were 9.5 percent higher than in the 4th quarter 2016.

Employment

Chemical companies in Germany further expanded employment in the 4th quarter 2017. With a workforce of currently 453,770, there was a staff increase by 1.5 percent over the previous year.

Please note:
The full version of the VCI’s quarterly report 4/2017 (in German language), an executive summary of the report in English, a table with updated key figures for the overall year 2017 and the speech (in English) of VCI director-general Utz Tillmann as well as all charts and some photos from the VCI’s press evening 2018 around the business situation of the chemical-pharmaceutical industry in Germany are available in the download section at the top ot this page.