Primary commodity plastics in Germany: Weak demand drives prices down further

Industry concerned about inflation, consumer demand and natural gas supply

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Germany and the whole of Europe appear to be on track for a recession. While the economy is still shrugging off the effects of past coronavirus waves, forecasts for the second half of 2022 are increasingly cloudy. High inflation, the war in Ukraine and persistent supply bottlenecks are putting the brakes on economic recovery, according to leading economic institutes.

Sharp rises in commodity and energy prices weigh on both businesses and consumers as a result of higher production costs and thus producer prices. Real income is falling in the face of the current high inflation, putting a damper on discretionary consumer spending. In addition, Russia is reducing natural gas deliveries to Europe incrementally and nervousness regarding the supply in the coming months is growing. This flurry of bad news is shaping developments in the primary plastics sector....

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