Germany 2012 first-half chemical production falls 4% – VCI

12 July 2012 13:50  [Source: ICIS news]

LONDON (ICIS)--Germany’s chemical and pharmaceutical production fell 4% year on year in the first six months of 2012, largely because of the effects of the eurozone crisis, an industry trade group said in an update on Thursday.

Excluding pharmaceuticals, first-half 2012 chemical production was down 3.5% year on year, Frankfurt-based Verband der Chemischen Industrie (VCI) said.

However, despite the first-half decline, VCI maintained its previous forecast of zero year-on-year production growth for 2012, saying that full-year chemical and pharmaceutical production will still be level with 2011 production.

Full-year chemical and pharmaceutical sales are projected to increase by 2.0%, with prices expected to be up also by 2.0%. Excluding pharma, chemical sales and prices are projected to rise by 2.5% in 2012.

“The industry has performed well in a difficult economic environment,” said VCI president Klaus Engel, commenting on the first half of 2012 and the full-year outlook.

Germany’s chemical industry offers high-quality and innovative products, and as such it remains competitive in the current crisis, said Engel, who is also CEO of Germany-based specialty chemicals major Evonik.

Germany’s chemical producers will be looking in particular to their domestic market for business, he added.

As for the first half, chemical and pharmaceuticals sales declined by 0.5% to €89.2bn ($108.8bn).

Domestic sales were up 0.5% to €35.5bn while chemical firms’ direct export sales abroad declined by 1.0% to €53.7bn.

First-half exports – including chemical producers’ direct exports, re-exports, and exports of chemicals by other industries – were up 1.0% to €77.2bn. Growth came from Asia, South America and the US while sales to European markets declined, VCI said.

Producer prices were up 3.0% year on year as firms raised prices because of high raw material costs, the group said.

VCI also said that it expects Germany’s chemical and pharmaceuticals industry to raise its investments by 5% this year to around €6.7bn, with much of the investment going into capacity expansions.

($1 = €0.82)

Paul Hodges studies key influences shaping the chemical industry in his Chemicals and the Economy Blog

By: Stefan Baumgarten
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