Germany's VCI sees chemicals sector 'bright spots' as lifts forecast

VCI Global

15/05/2024 09:00

May 15 (Reuters) - Germany's chemicals industry
association raised its annual output forecast on Wednesday,
highlighting 'bright spots' after a better than forecast start
to 2024 due to higher demand outside Europe, particularly in
Asia, North America and Latin America.
    The VCI lobby group, which represents around 1,900 companies
in Germany's third-largest industrial sector, now expects
production volumes including pharmaceuticals to rise by 3.5%. It
had previously forecast production to stagnate at 2023 levels. 
    Chemicals firms have cut inventories over the past two years
due to weak demand, but some are seeing tentative recovery signs
as volumes slowly pick up in the U.S., Europe and China.
    "We are now looking to the future with a little more
confidence, as growth prospects are slowly brightening," said
VCI President Markus Steilemann, who is also Chief Executive of
chemicals group Covestro  1COV.DE .
    "One good quarter does not make up for the slumps of the
crisis years. The situation is fragile overall." he added,
calling for political action to tackle the structural problems
affecting Germany's chemicals industry.
    VCI's forecast echoes the Ifo economic institute's latest
barometer for Germany's chemical industry, which slightly
improved in April, with companies expecting higher orders from
abroad and to expand production in the coming months.   

 (Reporting by Tristan Veyet and Bartosz Dabrowski; Editing by
Alexander Smith)
 ((Tristan.Chabba@thomsonreuters.com;))