German chemical lobby VCI: quarterly sales and production fall amid tariff uncertainty

Evonik Industries AG

03/09/2025 07:30

Sept 3 (Reuters) - Germany's chemical industry association said on Wednesday that production, sales, and prices in the sector declined in the second quarter, citing uncertainties regarding the U.S. tariff policy.

The VCI association said pull-forward effects in business with the United States waned throughout the April-June period, as exports had been brought forward in anticipation of tariffs on goods from Europe.

Overall production in the chemicals sector including pharmaceuticals fell 3.8% quarter-on-quarter, contrasting with the January-March quarterly increase of 6.7%.

"Weak demand, declining sales, and production far below pre-crisis levels - this is the current reality in our industry and also in large parts of German industry," VCI managing director Wolfgang Grosse Entrup said in a statement.

The sector, the third-largest industry in Europe's economic powerhouse Germany, can be seen as a bellwether for the broader economy as it produces materials used in sectors ranging from automotive and construction to agriculture and textiles.

Pharmaceutical output fell by 5.6% compared with the previous quarter.

On an annual comparison, overall quarterly production was down 3.1%, or 5.1% when pharmaceuticals were excluded, and revenue fell by 2.7% compared with the same period last year.

The industry maintained its 2025 guidance for production volumes including pharmaceuticals to fall by 2% and industrial sales by 1%.

 (Reporting by Bartosz Dabrowski and Cian Muenster in Gdansk)

 ((Bartosz.dabrowski@thomsonreuters.com))