Germany's chemical industry suffers setbacks in Q4 2018

Source: Xinhua| 2019-03-13 02:05:18|Editor: yan
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BERLIN, March 12 (Xinhua) -- Chemical production in Germany declined by 10 percent and has ended in "very weak fourth quarter", the German chemical industry association (VCI) announced on Tuesday.

The falling demand for chemicals from industrial customers in Europe had forced German chemical companies to make major production cuts. Total revenues of Germany's chemical industry fell by 3.1 percent in 2018, according to VCI.

"The demand for chemical products in the German and European industry is on the decline. Moreover, Brexit acts as a brake on the economy," VCI director-general Utz Tillmann stated.

Prices for German chemical and pharmaceutical products continued to climb from October to December last year, exceeding the previous quarter's level by 0.4 percent and the level of the previous year by 2.7 percent. However, the rising prices "did not offset" the negative developments, "so that sales fell", VCI announced.

The German chemical and pharmaceutical industry is expecting a continuing decline. The VCI therefore drastically cut its 2019 forecast by 5 percent and is now expecting a decline in revenues of 2.5 percent to 198.5 billion euros (224.1 billion U.S. dollars).

For 2019, the VCI is now expecting a drop in chemical production of 3.5 percent in the country.

Many large German chemical companies such as Bayer, BASF and Covestro reported problems with supply chains and production caused by the low water levels of Germany's most important waterway, the river Rhine, that lasted throughout large parts of Q3 and Q4 2018.

Despite the general economic downturn, chemical and pharmaceutical companies in Germany kept hiring more staff in Q4 of 2018. The German chemical industry is now employing a total of 462,000 staff, which is 2 percent more than the previous year.