Optimism in Germany

By Thomas Allen04 May 2017

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The Mechanical Engineering Industry Association (VDMA), based in Frankfurt, Germany, has reported that German manufacturers of building material plants are feeling positive about the year ahead, after a period of growth towards the end of 2016.

After several years of decline, orders received in most subsectors had risen considerably at the end of 2016, compared with the previous year.

“This should translate into sales growth over the next few months,” said Sebastian Popp, economic expert at the Committee for European Construction Equipment.

In 2016, German manufacturers of building material plants were said to have recorded an 8% rise in sector sales compared with the previous year, totalling €4.7 billion. Above all, this increase came from international business.

A 20% rise in new orders was also recorded, once again attributed primarily to international customers. The US apparently continues to be the biggest sales market for building material machines from Germany, followed by China and Russia.

However, this rise is mainly due to several large-scale orders that have boosted the industry as a whole, and does not therefore indicate a substantial boom, said the VDMA.

While Hermann Weckenmann, chairman of the concrete technology section of the VDMA, said “the industry has no confidence in any medium or long-term stable, positive development”, there does appear to be some cause for longer-term optimism.

According to the VDMA, Europe’s construction industry is expected to develop robustly, growing by an estimated 2% in 2017, with Germany and the UK tipped to be the greatest stimulants. Also, good market opportunities have been described in the US and some emerging economies, such as India and Indonesia.

Furthermore, IA Cement – advisers to the global cement industry – has predicted that global demand for cement will increase by 2% this year. And market analyst Citi Research has reported that, after a long period of barrenness, mining companies are showing interest in making purchases again throughout the world.

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