The mood in the German chemical industry improved in September for the second time in a row

Berlin. The mood in the German chemical industry brightened for the second time in a row in September, also due to increasing foreign demand. The index rose to plus 5.5 points, from minus 2.6 points in August, as the Munich Ifo Institute announced on Friday in its survey.

The companies once again rate the business situation positively with a plus of 8.8 points. The outlook for the coming months also brightened noticeably: from minus 15.0 to plus 2.3 points. “Customers at home and abroad are continuing to increase their inventory and accepting higher prices,” said Ifo industry expert Anna Wolf.

The recovery in the chemical industry is being driven by exports and orders from the manufacturing sector. According to the information, the higher spending on defense and infrastructure from the federal government's special funds also has a positive effect through the corresponding advance purchases. However, companies still estimate the order backlog to be very low.

Given the high cost level, the earnings situation remains tense, despite the improvement compared to May 2026. Companies are therefore planning to further reduce their workforce. “The recovery is fragile as improved price competitiveness is based on temporary factors, including production losses and supply chain disruptions in the Gulf region,” Wolf said. “The location disadvantages remain, job cuts continue.”

The ongoing blockage of the Strait of Hormuz as a result of the Iran war has led to supply disruptions in Asia. This increases the demand for chemical products made in Germany. Since there are currently no geopolitical signs of easing, many companies expect this exceptional economic situation to continue. The Chemical Industry Association (VCI) recently spoke of a ray of hope, but does not yet see a turnaround in the trend. According to the VCI, better location conditions are necessary for a real upswing.