THE GERMAN CHEMICAL

INDUSTRY

DECEMBER 21, 2018

Dr. Thorsten Bug,

Senior Manager Chemicals
Agenda

1. The Chemical Industry Globally

2. The German Chemical Industry
3. Opportunities for Chemicals Producers in Germany

Main sources:
• Cefic: The European Chemical Industry Councel, Brussels, www.cefic.org
• Destatis: Statistisches Bundesamt (engl.: Federal Statistical Office), Wiesbaden, www.destatis.de
• VCI: Verband der chemischen Industrie (engl.: German Chemical Industry Association), Frankfurt/Main, www.vci.de

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Global chemical revenue
Market shares from NAFTA, Europe and Japan are progressively moving
to Asia.

22%
19% 58%

17% 49%
15% 6% 4%
Europe Japan

NAFTA

2% 1%
Asia
Africa, Australia, Middle east

4% 3%

Latin America

Global revenue in percentage share

2012: EUR 3,127 billion

2017: EUR 3,475 billion

Quelle: Cefic, Facts and Figures 2018

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Global Chemical Revenue
Despite the Asian market growth in recent years, Europe continues
to be a relevant chemicals market.

EUR 2012: 2017:

673 bn EUR
EUR 3,127 bn 654 bn EUR 3,475 bn
(22%)
(19%)

Europe Asia NAFTA Japan Other

Quelle: Cefic, Facts and Figures 2018

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Global Chemical Revenue
Germany is the world‘s third largest chemical market, being surpassed
only by China and the US in terms of revenues.

Chemical Revenue in EUR billion, 2017

1500

1000

500

0
China USA Germany Japan South Korea India Taiwan Brazil Russia

Source: Cefic, Facts and Figures 2018; Total revenue globally 2017: EUR 3,475 billion.

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European Revenues
With a share of 29% in 2017, the German chemical industry has
consolidated it‘s leading role in Europe during the recent years.

European (EU-28) Chemical Industry Revenues in EUR billion, 2011–2017

600

92 93 90
500 89 94
103 Rest of EU-28
36 86
37 38 36
38 40
400 39 38 35 35
Belgium
38 39
46 38 36 36
38 40 36 Spain
EUR billion

41 36
51 55 50
300 49 47 52 UK
48
55 52 52 52 50 53 Netherlands
50
200 80 78 77 78 73 Italy
73 66
France
100
164 161 165 154 149 147 155 Germany

0
2011 2012 2013 2014 2015 2016 2017

Quelle: VCI, Chemiewirtschaft in Zahlen 2018 (Table 60b)

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Agenda

1. The Chemical Industry Globally

2. The German Chemical Industry
3. Opportunities for Chemicals Producers in Germany

Main sources:
• Cefic: The European Chemical Industry Councel, Brussels, www.cefic.org
• Destatis: Statistisches Bundesamt (engl.: Federal Statistical Office), Wiesbaden, www.destatis.de
• VCI: Verband der chemischen Industrie (engl.: German Chemical Industry Association), Frankfurt/Main, www.vci.de

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The History of the German Chemical Industry
Within 50 years, revenues increased by a nominal 5.4 % (real 3.1%) on
average a year. This resulted in a 14-fold productivity increase.

Revenues and Number of Employees of the German Chemical and Pharmaceutical Industry, 1960-2010

700 180

598 160
600 568 568
Number of employees in Thousand

140
500 470

Revenues in Euro billion

458
415 120

400 100
171
300 80
135
60
200 100
40
65
100
20
30
12
0 0
1960 1970 1980 1990 2000 2010
Quelle: VCI, 2013.
Details: 1960 without Saarland. From 1964 on including West-Berlin; 1970, 1995, and 2008 new Classification.
From 1991 Germany reunified.

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German Chemical Companies Structure
The industry is “dominated” by small companies, whereas the lion’s
share of revenues are raised by large corporations.

Number of Chemical Companies, Employees and Revenues by Company Size, 2017

80
72
69
70
59
60

50

40 36
in %

30 28
25

20

10 5
3 3
0
Number of companies Employees Revenues
1 - 49 employees 50 - 499 employees > 500 employees

Source: VCI, Chemiewirtschaft in Zahlen 2018, Table 18b.

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Chemical Exports
Germany is the second largest exporter of chemicals globally.

Chemical Exports by Country in EUR billion, 2017

120

100

80

60

40

20

0
USA Germany China The Belgium South Korea Japan France Singapore Saudi Arabia
Netherlands

Source: VCI, Chemiewirtschaft in Zahlen 2018, Table 61b.

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German Chemical Exports
European countries are dominating German Chemical Exports.

EU 28 European non-EU
(without Germany)

60% 10%

17%

7%
Asia
NAFTA

3%

Latin America 3%

Rest of the world (ROW)

Source: VCI, Chemiewirtschaft in Zahlen 2017, Table 42b.

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Chemical Market Segmentation
Fine and specialty as well as basic chemicals continue to constitute the
backbone of the German chemical production market.

Chemical Market Segmentation by Revenues in EUR billion, 2010–2017

50

40
EUR billion

30

20

10

0
Petrochemicals Fine & Speciality Polymers Anorganic Basic Detergents & Care
Chemicals Chemicals Products
2010 2011 2012 2013 2014 2015 2016 2017

Source: VCI, Chemiewirtschaft in Zahlen 2017 (Table 15a)

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German Chemicals Production
Despite the economic downturn in 2009, the Basic Chemicals output in
Germany remained almost steady since 2000.

Production Volumes of Basic Chemicals in Germany, 2000–2015

8.000
Thousand tons

6.000

4.000

2.000

2000 2005 2010 2015

Source: VCI, Chemiewirtschaft in Zahlen 2016, Table 4a and 4b; Oxygen in million m3 under normal conditions..

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Germany‘s private R&D spending
German chemical industry R&D expenditure was EUR 4.2 billion
in 2017, making the sector the fifth strongest in Germany.

R&D Expenditure by Industry, 2006–2017

70

60 4,3 4,2
4,2 Chemicals
4,3
6,2 6,5 6,2
3,9 5,8
50 4,0
6,0 6,2 6,3 Pharma
3,7 6,0
3,6 5,8 6,3
3,7 3,5 5,3
3,5 3,6 5,9
40 4,7 5,8 11,0 11,3 11,2
4,8 Mechanical
5,4 4,5 5,1 5,5 10,8
5,1
4,7
5,1 10,5 engineering
4,8 4,9 10,1
30 9,4
9,9 8,5 Electrical
10,6 9,2 8,3
engineering
20
34,4 34,8 34,5 Automotive
32,0
25,7 27,2 28,1
21,0 23,3 21,8 23,3
10 19,8

0
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

Source: VCI: Chemiewirtschaft in Zahlen 2018 (Table 48)

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Chemical Patents
Germany is number three spot for European chemical patent
registrations, only surpassed by the US and Japan.

European Chemical Patents granted by the EPO by Source Country in %, 2007–2017

100
13 14 14 16 16 ROW
90 17
4 4 4 China
80 3 4 4 4 3
4 3
4 4 4 3 3
4 Italy
5 3 4
70 5 5
5 5 4
7 Netherlands
7 7 6 7 7
60 UK
23 21 20 19 18 16
50 Switzerland

France
40
15 17
17 15 17 17 Germany
30
Japan
20
USA
24 26 25 25 27 27
10

0
2007 2009 2011 2013 2015 2017
Source: European Patent Office (EPO)

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Electricity generation
In the last 25 years Germany got “greener” as Renewables has grown
from 2% up to 19%. Nuclear energy decreased by 1/3 in the same period.

Electricity Generation in Germany by Energy Carrier in %, 1990–2015

100% 2 3 3 6
8 8 9 12
19
11 Renewables
12
24 23 10
75% 24
21 Natural Gas
18
20
Hard Coal
50% 31 32
35 32
28 20
Nuclear Energy

25%
Lignite
33 30 29
27 26 25

Other sources
0%
1990 1995 2000 2005 2010 2015

Source: AG Energiebilanzen e.V. (http://www.ag-energiebilanzen.de/)

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Investments in Europe
Thanks to market attractiveness, most chemical investments in Europe
for the period 2013 to 2017 occurred in Germany.

Number of Investments in Europe, 2013–2017

300

250

200

150

100

50

Chemicals Plastics Rubber

Quelle: fDi markets. Total number of investments (1,440): Chemistry (696), Plastics (576), Rubber (168). Graph represents 89% of all investments.
© Germany Trade & Invest www.gtai.de 17
The Chemical Cluster Landscape

Chemical Cluster offer added value to

their members:
• as networking platform for R&D
institutes, companies, and authorities
within the region
• through strategic alliances with
international chemical sites in Europe,
Asia and the US
• strengthen the cluster members’ global
competitiveness

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Agenda

1. The Chemical Industry Globally

2. The German Chemical Industry
3. Opportunities for Chemicals Producers in Germany

Main sources:
• Cefic: The European Chemical Industry Councel, Brussels, www.cefic.org
• Destatis: Statistisches Bundesamt (engl.: Federal Statistical Office), Wiesbaden, www.destatis.de
• VCI: Verband der chemischen Industrie (engl.: German Chemical Industry Association), Frankfurt/Main, www.vci.de

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Raw Materials Supply
Germany´s chemical industry regions are well connected to the
European pipeline grid.

Infrastructure of raw materials supply:

• Crude oil via pipelines from:
– Russia
– the Mediterranean Sea
– France
– the North Sea
• Crude oil processing via:
– 14 refineries
– 8 steam crackers
• Pipelines for:
– ethylene and propylene
– natural gas
– hydrogen
– carbon monoxide

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Phletora of Logistics
Additionally to the pipeline grid, Europe’s longest autobahn, rail and
waterway network connects Germany with its nine neighboring states.

Autobahn 12,550 km

Railways 40,330 km

Waterways 7,450 km

Seaports 9

Major Airports* 12

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Chemical Parks „Plug & Play“ concept

Chemical Parks – Advantages:

• About 30 chemical parks offer cost-
efficient and unique benefits through:
– excellent infrastructure
– chemical raw materials via pipelines
– gases and steam via pipelines
– secure energy supply
• Site operators offer expertise and
services from one source
• Investors choose the services from
site operator that suits their business
model best

Source: Factsheet „Chemical Parks in Germany“, Germany Trade & Invest, February 2017
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Chemical Parks – Selected Locations

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Chemical Parks – Selected Locations

D
C

© Germany Trade & Invest www.gtai.de 24

Chemical Parks – Selected Locations

D
E

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Germany Trade & Invest
Contact

Germany Trade & Invest

Foreign Trade and Inward Investment Promotion Agency
Dr. Thorsten Bug Berlin Headquarters
Senior Manager Chemicals Friedrichstraße 60
T. +49 (0)30 200 099-603 10117 Berlin
Thorsten.bug@gtai.com Germany
T. +49 (0)30 200 099-0
F. +49 (0)30 200 099-111
www.gtai.com

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