Polymer production in Germany last year increased to 18 million tonnes, rising 2.9% over the same period a year prior according to information presented by Günter Hilken, chairman of the German plastics producers'' association, PlasticsEurope Deutschland (ex-VKE, Frankfurt). This high output continued during January 2006 as the market reported double-digit growth. Hilken says that in March engineering polymers showed exceptional demand.

Speaking late last week before the assembled trade press in Frankfurt, Hilken says his organization is calculating a 3.5% annual growth rate in German-produced polymers for the next four years. The largest growth polymer last year was high-density polyethylene, which rose 5.7%. This was followed by a 4.7% improvement in PET through higher bottle demand, 2.8% for polypropylene, and 1.5% increase for vinyl. Only polystyrene showed a drop of 2.4%. The biggest winner among engineering plastics last year was polycarbonate with a growth rate of 6.9%. During 2005, German-made plastics sold for €21 billion, a 5.3% rise in revenue above the amount generated a year earlier. Polymers exported resulted in a foreign currency turnover of €12.5 billion, up 6.5% over the previous year. Nearly 72% of all resin exported went to surrounding European Union countries.

Demand for polymers produced and processed in Germany came mainly from packaging (32.5%, with a sales up 5.8% compared to 2004 and a volume increase of 2.5% for the same period), building and construction (24.5%), automotive (8.5%), electronics/electrical (7.5%), and other uses with 27%. Building and construction again showed a weakness with a drop of 5.3% over 2004.

Official government figures for the sector report a 1% drop in employment last year despite the increase in output and higher return on investment. Nevertheless Hilken says the industry is being hurt by high oil costs (a 42.1% increase over 2004) and rising natural gas prices as well as spiking electricity charges, due to `green'' taxes that make power in Germany some of the most expensive in Europe.-Robert Colvin; [email protected]