ifo: Business climate in the chemical industry improves significantly

For the first time in four years, companies in the sector are actually viewing the business situation positively.
 
Sentiment amongst senior management in the German chemical industry improved sharply in August, according to the Munich-based Institute for Economic Research (ifo). According to its monthly survey, the Business Climate Index rose from minus 26.3 points in July to minus 2.4 points in August. Business expectations also brightened significantly, with the corresponding indicator rising from minus 37.2 to minus 15.5 points. ifo expert Anna Wolf explains: “The ongoing blockade of the Strait of Hormuz and the resulting supply disruptions in Asia are driving up demand for chemical products manufactured in Germany.” As there are no signs of geopolitical tensions easing, companies expect this trend to continue. The institute’s figures also point to an improvement in exports. The supply situation is said to likewise eased somewhat: whereas one in three chemical companies reported material shortages in the second quarter of 2026, this figure has now fallen to just 13.8 per cent. However, as structural problems such as high energy and site costs continue to weigh on the sector, the data suggests that companies expect further staff cuts despite the upturn. “In the medium term, however, government infrastructure and investment programmes could underpin demand for chemical intermediate goods, provided the announced projects are implemented swiftly,” says Wolf.
 
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