German chemicals industry sees higher 2017 growth on price hikes

The association of Germany's chemical and pharmaceutical companies on Wednesday lifted its 2017 revenue estimate as strong demand allowed businesses to pass on higher materials costs to customers but it warned that price hikes would not continue.

Industry sales would likely increase 3.5 percent this year, up from a March estimate of a 1.5 percent, the VCI lobby group said in a statement. Output volumes were seen growing 1.0 percent, compared with 0.5 percent expected previously.

"Companies were able to swiftly pass on higher raw material costs to customers due to a pick-up in demand," the group said, also citing high capacity utilization rates of 87.7 percent on average.

It cautioned, however, that price gains in basic chemicals would not continue as market participants were banking on recent strong price gains in crude oil to peter out.