German coatings, paint, pharma producers trail recovery – survey

28 September 2010 15:46  [Source: ICIS news]

TORONTO (ICIS)--German producers of coatings, paints and plastics products are trailing the chemical industry’s overall recovery, a regional industry association said on Tuesday, citing a survey.

Chemieverbande Rheinland-Pfalz, which represents chemical and pharmaceuticals producers in BASF’s home state of Rhineland Palatine, also said that many pharmaceuticals firms had not yet recovered from the crisis.

In fact, producers' first-half domestic pharmaceuticals sales in the state were down 4% from the year-earlier period, the group said.

Overall, the state’s chemical industry sales rose 41.1% in the first six months of 2010, compared with the 2009 first half. However, group president Herbert Stein warned against “exaggerated euphoria”.

The year over year increase came against a weak 2009 first half and as such did not represent “growth in the classical sense of the word,” he said.

He went on to warn of a “significant slowdown” in growth in the second half of the year.

According to the survey, 50% of the state's chemical firms expected the recovery to continue in 2011, the group said.

However, about one third of firms polled cited rising energy and personnel costs as risks to the recovery.

Producers also said they worried about a recent ruling by Germany’s top federal labour court that it would no longer abide by "Tarifeinheit", an important priniciple in collective bargaining that lays down that there is only one collective agreement per plant.

Commentators have said that giving up on the principle could expose Germany to more strikes, and as such could threaten the country's role as a competitive site for industrial production.

In related news on Tuesday, Germany's consumer confidence rose to a three-year high.

Market research firm GfK said its latest survey showed that German consumers expected the recovery of Europe's largest economy to continue. Consumers' confidence was supported by lower unemployment and a "moderate price climate," the firm said.

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