German chemicals sector recovery loses momentum in Q2, says industry group

VCI Global

10/09/2024 09:00

Sept 10 (Reuters) - A slight recovery in the German
chemicals sector lost momentum in the second quarter, a report
by the VCI industry body said on Tuesday, as both domestic and
foreign orders slowed in the April-June period, especially in
the pharmaceutical branch. 
    "The global economy has not picked up speed as hoped," VCI's
Managing Director Wolfgang Grosse Entrup said in a press
release, adding that Germany's structural problems, such as high
production costs, red tape and labour shortages, remain
unresolved. 
    Overall production in the chemicals sector including
pharmaceuticals added only 0.8% quarter-on-quarter, slowing down
drastically from the January-March quarterly increase of 5%. 
    Germany's chemicals industry suffered heavily throughout
2023 due to high production costs and weak demand amidst high
inflation. Europe's largest chemicals producer started showing
the first signs of recovery in the first quarter of this year,
which are now fading away.
    Pharmaceutical output fell by 4% compared with the previous
quarter.  
    On the annual comparison, overall production was up 3.7%, or
8.4% when pharmaceuticals were excluded, but revenue fell by
0.6% compared with the same period last year.  
    Still, the industry maintained its annual guidance for
production volumes including pharmaceuticals to grow by 3.5% and
industrial sales by 1.5%.
    

 (Reporting by Andrey Sychev 
Editing by Miranda Murray)
 ((andrey.sychev@thomsonreuters.com))