German chemical sector heads for record year as prices rise

Jul 14, 2011, 10:52 GMT

Frankfurt - Germany's chemical industry is heading for a record year with the sector's main association saying Thursday it was raising its 2011 sales outlook.

'The industry's production and sales will set a new high in 2011,' said Klaus Engels, the president of the German Chemical Industry Federation (VCI). He was releasing the VCI's latest half yearly report in Frankfurt.

The VCI expects sales for German chemical companies to rise by 10 per cent this year, higher than the 9-per-cent increase the federation had forecast in May.

The Frankfurt-based VCI raised its full-year forecast following a strong performance by the industry during the first half combined with higher-than-expected chemical prices.

Engels said he expects the growth in the industry, which is a key pillar of the Germany's export machine, to continue during the second half but at a slower rate amid signs that the global economy has lost steam in recent months.

The chemicals sector is also the nation's third-biggest industrial sector after the car and mechanical engineering industries.

The VCI expects production to grow by 5 per cent this year after rising by 6.5 per cent year-on-year during the first half.