German chemical production, prices, sales down in Q4 – VCI

LONDON (ICIS)–The German chemical trade group Verband der Chemischen Industrie (VCI) said on Wednesday the industry registered lower production rates, prices, sales and capacity utilisation on a sequential basis during the fourth quarter of 2014.

VCI expects the chemical industry to increase its output in 2015 by 1.5%, although prices will fall 2% and sales by 0.5% totalling €192.2bn.

VCI said the growth experienced by the German economy in 2014 did not reach the chemical industry on the back of falling crude prices, adding that “customers were hoping for a further decline of chemical prices” postponing their buying decisions.

The better prospects for 2015 will help the German chemical industry leave behind a year for which during its last quarter all the industry’s indicators declined.

According to VCI, chemical production was 0.3% lower in Q4 quarter on quarter, while the fall was of 0.8% if measured in year on year terms. Capacity utilisation stood at 83.3%, within its normal range, the trade group said.

Prices also declined in the fourth quarter both quarter on quarter and year on year, with successive falls of 0.9%. Sales also fell in both comparable periods, by 0.4% and 0.2% respectively.

The rosier note came from employment in the chemical industry, which employed in the fourth quarter of 2014 a total of 444,500 workers in Germany, an increase of 1.5% year on year.

Looking ahead, VCI’s director general Utz Tillmann said the economic performance in the eurozone will remain slow and warned chemical companies should expect “moderate” business growth.

“Against this backdrop [of slow recovery in the eurozone], chemical companies are expecting moderate business growth in their major sales markets. Furthermore, the low oil price and the weak euro will give impetus to the economy. All the same, economic dynamics will remain low overall,” said Tillmann.