The Ifo institute reported on Nov. 3 that Germany's chemical industry business climate index fell to -5.9 points in October from 3.0 points in September. The current business situation indicator dropped to 2.4 points from 7.5, while the expectations index fell to -13.8 from -1.5.
Ifo industry expert Anna Wolf said company restructuring and production site closures are weighing on sentiment. Demand improved in October compared with September, with new orders increasing, but growth came mainly from German manufacturing while overseas demand remained weak.
With orders rising, chemical companies plan to increase output and raise product prices. Capacity utilisation improved to 76.6% in the third quarter from 73.4% in the second quarter.
Germany's chemical industry association VCI has forecast that German chemical and pharmaceutical production will fall 1.5% in 2026, while sales are expected to rise 2.5%, driven mainly by higher prices. The association said the competitive pressure facing the German chemical industry, at home and abroad, has not fundamentally changed.
