German construction activity continues to gain momentum

Germany’s construction industry received orders in July amounting to €7 billion ($8.1 billion). This is not only 10.1% above July 2017, but also the highest level ever registered, Kallanish learns from federation Hauptverband des Deutschen Baugewerbes (HDB).

July orders represented the highest monthly total during the first seven months, which was up 7.9% year-on-year, so “… we are remaining optimistic for the coming months,” said HDB’s managing director, Dieter Babiel.

Revenues reached €35 billion over January-June, the highest since 1995. The order backlog is 4.1 months which also marks a historic high.

Of the three groups residential, public and commercial construction, it is the latter that has proven the most powerful driver in the mix with orders in July up 17.6% y-o-y. It is arguably also the group that uses most structural steel. A major factor here has been funds released by railway company Deutsche Bahn for investments, from which many subcontracted companies benefit.

Residential construction also saw an increase of 17.5% in July following a temporary slowdown. Public construction was lagging behind with a y-o-y dip recorded in the month. However, investment in roads is strong showing an on-year increase of 10.4%. This contradicts somewhat the claims heard at this week’s EUROMETAL conference, that infrastructure spending in Germany does not keep up with increasing transport volumes.

HDB has indirectly confirmed a shortage highlighted at EUROMETAL however, which concerns the lack of personnel at public offices to handle project planning.