MOSCOW (MRC) -- Germany's chemical industry association VCI (Frankfurt) says that production of chemicals, excluding pharmaceuticals, went up 1.5% on a year-on-year basis, in the country during the first quarter, and increased 3.6% compared with the final quarter of 2019, said Chemweek.
This is mainly because of strong demand for hygiene products and packaging materials, VCI says. Nevertheless, the “full force” of the pandemic caused by the coronavirus disease 2019 (COVID-19) has not yet been felt by the industry, VCI says.
The COVID-19 pandemic had only a minor impact in the first quarter since it was only in March that economic growth started slowing and the demand for chemicals declined worldwide, VCI says. Sales by Germany's chemical/pharmaceutical industry increased 0.6% to EUR49.5 billion (USD54.5 billion) compared with the fourth quarter of 2019.
For full-year 2020, the association anticipates a significant drop in production and sales for the chemical/pharmaceutical industry in Germany. In March, VCI lowered its full-year production forecast, estimating a 1.5% decline in the country’s chemical output on the anticipated impact of COVID-19. VCI says it will now publish a more precise forecast after the second quarter.
According to a VCI survey, German chemical companies expect a severe recession in 2020, with firms facing many challenges due to declining orders, disrupted supply chains, and a lack of transport capacity. “2020 is going to be a difficult year for the chemical/pharmaceutical industry. Companies will strongly feel the effects of the corona crisis in the coming months. 75% of VCI members are expecting a sales decline in Europe,” says Christian Kullmann, president at VCI and chairman of Evonik Industries.
Kullmann restated the need for political action to restart the German economy. “Not only our industry but the entire German economy urgently needs an investment and growth program—instead of new burdens. Furthermore, we need genuine and holistic sustainability strategies and not projects that are solely oriented to the ecological component,” says Kullmann.
As MRC informed earlier, the European Council decided, after a special meeting held on 21 July, to introduce a levy on non-recycled discarded plastic as part of the EU's COVID-19 recovery plan. However, Germany's chemical industry association VCI (Frankfurt) had, prior to the EU Council’s meeting, expressed opposition to the project because it adds a regulatory and cost burden rather than supporting packaging recyclability.
As MRC informed before, members of the European Parliament (MEPs) are proposing ways to step up green energy storage solutions such as hydrogen or home batteries, in a report that was adopted in one of the Parliament’s voting sessions on Friday, 10 July. The proposals outlined in the report are set to play a crucial role in reaching the goals of the Paris Agreement on Climate Change, as more efficient energy-storage options in the EU will help "spur decarbonization," the EU Parliament says. In addition, since solar and wind have a variable electricity output, more storage solutions should become available to secure supply, MEPs say.
According to MRC's DataScope report, PE imports to Russia dropped in January-June 2020 by 7% year on year to 328,000 tonnes. High density polyethylene (HDPE) accounted for the main decrease in imports. At the same time, PP imports into Russia rose in the first six months of 2020 by 21% year on year to 105,300 tonnes. Propylene homopolymer (homopolymer PP) accounted for the main increase in imports.
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