The recovery lost momentum in the second quarter, according to the German Chemical Industry Association (VCI).
 

According to the VCI, total turnover in the chemical and pharmaceutical industry fell by 0.7 per cent in the second quarter to a seasonally adjusted total of 53.8 billion euros. Production rose slightly by 0.8 per cent compared to the previous quarter and was therefore 3.7 per cent higher than in the second quarter of the previous year. For 2024 as a whole, the VCI expects production to increase by 3.5 per cent. Despite falling prices, industry turnover is expected to increase by 1.5 per cent this year. The reasons for the overall unsatisfactory development in the second quarter of 2024 were that German industry has cut back on production in the past three months and held back on chemical orders. Demand from abroad had also declined. At 75.1 per cent, many plants were still not being utilised profitably due to the ongoing lack of orders. The recent rise in energy and raw material costs also represented an additional burden.
 
VCI Managing Director Dr Wolfgang Große Entrup said on Tuesday morning when the quarterly report on the economic situation in the industry was published: ‘The mood in our industry has cooled noticeably again. This is because the global economy has not gained momentum as hoped. There are therefore no signs of a sustained recovery in demand. At the same time, competitive pressure is increasing.’ The structural problems in Germany also remained unresolved. Although the growth initiative announced by the German government was a step in the right direction, it has not yet brought about a change in sentiment, according to Große Entrup. ‘Four out of ten industrial companies are now thinking about further reducing their production or even relocating it abroad. It is high time to finally tackle the structural problems of the location consistently,’ warns Große-Entrup.
 
Sources:

• Press release VCI (10.9.2024)
• Photo: © VCI / Lohner