Quartalsbericht: Chemie-Industrie profitiert vom Nahost-Konflikt

The German chemical and pharmaceutical industry experienced a rebound due to the conflict in the Middle East, as reported by the industry association VCI. In the second quarter of the year, the industry's revenue grew for the first time in three years, rising by 7.3 percent. This growth was attributed to a slight increase in production (+2.4 percent from the previous quarter) and a 5.7 percent hike in prices.

VCI attributed these price increases to supply chain issues faced by competitors in Asia and the Middle East, which are more reliant on the Strait of Hormuz for transportation. Many customers also stocked up on inventory amid concerns over the Iran war. However, VCI sees this as a temporary pause. As of June, the industry's production facilities were still operating below average capacity, and orders and revenue had already dropped by June.

"Stockpiling and geopolitical shifts are not a trend reversal," said VCI President Markus Steilemann. The association forecast a production decline of 1.5 percent for the entire year, having lowered its production forecast earlier in the year from stagnation to a 2.5 percent growth. The association noted that high production costs, a sluggish industrial cycle, and the still weak utilization rates continue to burden the industry.