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Chapter 4: Leading Sectors for U.S. Export and Investment

Exchange Rates

Exchanges rates used throughout this chapter unless otherwise stated:

Year

EUR 1 = USD

2012

1.28

2013

1.33

2014

1.37

2015

1.37

Information Technology and Software

Overview

USD billion

 

2012

2013

2014(estimated)

Software

22.1

23.2

26.2

Consumer Electronics

16.1

14.2

14.9

IT Hardware

26.9

27.5

28.5

Telecommunications Devices

11.3

12.6

14.0

Telecommunications Infrastructure

7.7

8.2

8.6

(Source: BITKOM)

Germany’s ICT market is the largest in Europe. Industry experts are expecting a larger growth rate in the near future due to the easing of the Eurozone crisis. Drivers for this growth are the necessity to increasingly focus on cost reduction, efficiency and compliance, as well as implementation of new technology for business expansions into new regions. The German IT market is very competitive, but U.S. firms have a very strong position employing ten thousands of employees in Germany. IBM has had operations in Germany for more than 100 years. Analysts estimate that approximately 75% of software products sold in Germany are supplied by U.S. companies. In 2012, the largest software companies (SAP, Oracle, IBM, etc.) in Germany accounted for more than EUR 9.4 billion in sales. This represents 55% of the German market. However, smaller companies also have a niche alongside the major players.

Today there are more than 72,000 ICT companies in Germany, employing 876,000 people. As many other countries, Germany is suffering from a shortage of IT professionals.

Opportunities

Industry-specific and niche products will continue to find good sales opportunities in Germany. U.S. IT products are seen as innovative, having superior quality and cutting edge technology. The German public sector, banking, insurance, medical and utilities sectors offer good opportunities.

“Green IT” is driving demand for systems planning and design solutions. Government enterprises are planning to implement digital solutions for e-government and e-health, fueling growth in both hardware and software market and could be seen as opportunity to U.S. companies who would be able to assist in those areas. The need to improve operations and profitability amongst a new globally competitive environment is the main driver for an increased in-house IT spending by SMEs.

Best Prospects

IT Security, Cloud computing, Mobile Applications, and big Big Data. Other areas of interest are IT-Outsourcing, Social Media, Business Intelligence and Industry 4.0. (Source: BITKOM)

Web Resources

Trade Fairs:


CeBIT (ICT trade show): www.CeBIT.de
IT-SA (IT Security Trade Show): www.it-sa.de

conhIT (Europe’s largest event for Healthcare IT): www.conhit.de
gamescom (Europe’s leading games trade show): www.gamescom-cologne.com

Trade Associations:
www.bitkom.org

www.bitmi.de

www.teletrust.de

www.eco.de

www.nifis.de

www.biu-online.de

www.vatm.de

Government Entities:

Federal Office for Information Security: www.bsi.de

German Regulatory Authority: www.bundesnetzagentur.de


Trade Publications:

www.computerwoche.de
www.crn.de

www.channelpartner.de

www.eito.com

Commercial Service Contact for Computer Hardware, Consumer Electronics and Telecommunication:
Mathias.Koeckeritz@trade.gov

Commercial Service Contact for Software:
Doris.Groot@trade.gov

Drugs and Pharmaceuticals

Overview

USD billion

 

2012

2013

2014

(estimated)

2015 (estimated)

Total Market Size

18,600,000

19,700,000

21,220,000

21.84

Total Local Production

39,500,000

40,700,000

41,920,000

43.20

Total Exports

70,500,000

73,000,000

75,200,000

77.50

Total Imports

49,600,000

52,000,000

54,500,000

56.1

Imports from the U.S.

9,300,000

9,849,000

10,150,000

10.50

Exchange Rate: 1 USD

1.28

1.33

1.37

1.37

(Source: BPI-German Pharmaceutical Industry Association)

Germany’s market for drugs and pharmaceuticals is the fourth largest worldwide after the United States, Japan and China. The German government’s commitment to its fiscal austerity program and to additional spending cuts by 2014 are restricting annual market growth to one-digit increases. Market consolidation continues, and drug prices have been under pressure from de-reimbursement; fixed-level drug pricing, and referencing pricing schemes. The market is projected to grow annually by 3% from 2012-2015, with the fastest growth for new and expensive pharmaceuticals in the specialized hospital segment. The statutory health insurance system accounts for about 80% of the market, with tight reimbursement rules, greater use of generics and downward pressure on generic prices due to the rebate system and the full VAT of 19% levied on drug sales. Opportunities also exist for local production, research and acquisition of German pharmaceuticals manufacturers.

Sub-Sector Best Prospects

Drugs for acute conditions such as cancer, rheumatoid arthritis, and multiple sclerosis; but also for chronic conditions such as cardiovascular diseases; diabetes; and preventive medicine. Drugs for rare diseases, so-called Orphan Drugs, with market exclusivity for 10 years in the European Union, should also see good market potential as should bio-based medication; personalized medicines and biosimilars/biopharmaceuticals.

Opportunities

Germany remains an attractive export market for innovative U.S. drug makers, despite one-digit market growth in recent years and increasing competition from generic drug manufacturers as a result of patent expiration. Consumer spending on pharmaceuticals remains high and is expected to increase further with an ageing population. Early assessment of new and innovative drugs is expected to contribute to the decrease in consumer drug prices for the patented drug segment. The generic market is also growing as patents expire, resulting in additional opportunities for U.S. suppliers.

Web Resources

German Government Agencies:
German Health Ministry: www.bmg.bund.de
Federal Agency for Pharmaceuticals and Medical Products: www.bfarm.de
Federal Agency for Sera and Vaccines: www.pei.de
Federal Institute for Risk Assessment: www.bfr.bund.de
Federal Institute for Consumer Protection and Food Safety: www.bvl.bund.de

Trade Fairs:

CphI: www.cphi.com

Expopharm: www.expopharm.de

Biotechnica: www.biotechnica.de

MEDICA: www.medica.de

Trade Associations:
BPI (Association of the German Pharmaceutical Industry): www.bpi.de
VFA (German Association of Research-Based Pharmaceutical Companies): www.vfa.de
BAH (Federal Trade Association of Pharmaceutical Manufacturers): www.bah-bonn.de
German Generics Manufacturers Association: www.generika.de

Commercial Service Contact:
Anette.Salama@trade.gov

Medical Equipment

Overview

USD billion

 

2012

2013

2014

(estimated)

2015 (estimated)

Total Market Size

29,700,000

30,400,000

31,044,000

31.6

Total Local Production

29,000,000

29,800,000

30,600,000

31.3

Total Exports

20,000,000

20,500,000

21,200,000

21.8

Total Imports

19,700,000

21,100,000

21,644,000

22.1

Imports from the U.S.

5,625,000

5,906,000

6,200,000

6.5

Exchange Rate: 1 USD

1.28

1.33

1.37

1.37

(Sources: Spectaris Trade Association; BVMED Trade Association; Eucomed; Statista)

With currently 5.4 million employees, the healthcare industry is the biggest employer in the country. Germany is Europe’s largest market for medical devices and the world’s third largest market behind the United States and Japan, accounting for roughly EUR 30 billion in 2013. Although in decline, Germany’s population accounts for 20% of the total population in Western Europe with an estimated 80.6 million inhabitants in 2013. Germany counts 2,000 hospitals; 2,000 medical supply stores; 1,200 rehabilitation centers; 21,500 pharmacies; and 150,000 doctors’ offices. Key industry drivers include the need for innovation; the solid financial basis of the German medtech industry (80% of which are SMEs); and a stable demand in major health care market segments.

At over 11.6% of GDP in 2013, healthcare expenditures continue at high levels. Health reforms and cost-cutting measures keep the market tight, with continued downward pressure on prices. Government funding of hospital projects has remained static; major opportunities are seen for private hospitals and clinics. Demand will mainly be driven by a substantial increase in the number of patients due to demographic changes and by the need for economies of scale and efficient procedures. Furthermore, there is a trend towards a healthier lifestyle resulting in increased consumer spending on health care. The German medical market grew by 2.6% in 2013. The medical technology sector continues to be strong in innovation and will provide good potential for U.S. suppliers of innovative and price-competitive products. Buzzwords are personalized medicine; 3-D printing; and big data applications. U.S. medical device exporters to Germany continue to hold a 27-30% import market share.

Sub-Sector Best Prospects

High-quality advanced diagnostic and therapeutic equipment; innovative technologies and minimally invasive equipment, such as laser-optics in vascular surgery, urology, gastrology, dermatology, and neuro-surgery, new diagnostic and imaging devices, as well as specialized wound care and easy-to-use home care products. The trend is toward demand for miniaturized electro-medical equipment and nano-technology products. Preventive diagnostics and medical products, innovative orthopedic and physiotherapy devices, and biomaterial, cardiovascular and endoscopy products will also find good markets in Germany. Novel imaging technologies, e-health and e-care, mobile medical products are also in demand in Germany. Keywords are: computerization and electronic diagnosis; therapy planning and survey; molecularization-biotechnology, cell and tissue engineering, personalized medicine; miniaturization-microsystems technologies, nanotechnology and optical technologies.

Opportunities

Horizon 2020, the new Framework Program for Research and Innovation by the European Union, is providing funding of approximately EUR 70 billion for the period 2014-2020. It covers the entire process of innovation, from the basic research to the provision of marketable products and services. In order to be able to make a contribution to the new EU 2020 strategy, the 8th Research Framework Program by the German Federal Ministry of Education and Research will take up the innovation policy aims of the EU in order to facilitate and promote innovation much more efficiently.

Web Resources

German Government Agencies:
German Health Ministry: www.bmg.bund.de/
Federal Agency for Pharmaceuticals and Medical Products: www.bfarm.de/EN/Home/home_node.html

Federal Bureau for Physical-Technical Equipment: www.ptb.de
Federal Institute for Risk Assessment: www.bfr.bund.de
Federal Institute for Consumer Protection and Food Safety: www.bvl.bund.de

German Medical Devices Law: www.dimdi.de/static/en/mpg/recht/index.htm

Trade Fairs:
MEDICA: www.medica.de and http://export.gov/industry/health/eg_main_032846.asp

Trade Associations:
Federal Association of the Medical Devices Industry: www.bvmed.de
Federal Association of the Electro-Medical Industry: www.zvei.de/medtech
German Medical, Optical and Mechatronic Technologies Industry Association (SPECTARIS): www.spectaris.de
German Hospital Association: www.dkgev.de
Medical Dealers Association: www.zmt.de

Commercial Service Contact:

Anette.Salama@trade.gov

Industrial Chemicals

Market Overview

USD billion

 

2012

2013

2014

(estimated)

2015

(estimated)

Total Market Size

116.4

121.3

125.8

130.1

Total Local Production

181.5

191.5

201.1

205.5

Total Exports

207.5

219.4

230.9

235.6

Total Imports

142.4

149.2

155.6

160.2

Imports from the U.S.

19.2

20.1

21.2

22.3

Exchange Rate: 1 EUR

1.28

1.33

1.37 (forecast)

1.37 (forecast)

(Source: German Chemical Association VCI)

The outlook for the chemical markets in the EU is positive for 2014 and beyond and the situation in the German chemical industry improved substantially. The still modest growth in 2013 is expected to continue to improve throughout 2014 and 2015. Insiders anticipate that sales will increase by 1.5% compared with 2014. The German chemical market is expected to see growth rates of 3-4% in 2015 and 2016.

With the intensified exploration of shale gas deposits in the United States and its favorable impact on the local product costs, U.S. chemical manufacturers may find themselves being particularly competitive with European companies. Therefore, an increased demand for chemical imports from the United States can be expected.

Sub-Sector Best Prospects

Agricultural chemicals, construction chemicals, electronic chemicals: High purity chemicals for semiconductors or flat panel manufacturing; chemicals for photovoltaic production or, improved adhesives. There also is a demand for new building blocks to produce advanced polymers. Research is focusing on new energy sources like ethanol, battery development and other alternative energy solutions. Innovative active pharmaceutical ingredients; advanced materials and new substances for the high-tech industries remain best prospects.

U.S. chemical producers of innovative chemicals find good to best prospects in the German chemical market while producers of standard materials can face substantial competition from local German or EU producers. Several globally active chemical producers are located in Germany, among them giants such as BASF; Bayer or Wacker.

Opportunities

Germany offers good to excellent business opportunities across all chemical sub-sectors for U.S. companies that offer innovative chemicals. “Green” chemicals are of interest. Increasingly, there is a need to replace hazardous substances too costly to register under the EU chemical regulation (REACh) such as azodicarbonamide; chromate or other metal salts. Sustainability is important as is energy-efficiency. Interest in recycling of chemicals is increasing. Moreover, some local chemical companies are re-focusing their product portfolio such as Bayer which is expanding towards the more lucrative life-science business.

U.S. companies can often supply several EU markets by signing up with one single German distributor.

Web Resources

Trade fairs in Germany generally offer good business opportunities.

Analytica: www.analytica.de/link/en

CPhI: www.cphi.com

European Coatings Show: www.european-coatings-show.de/

Fakuma: www.fakuma-messe.de/en/fakuma

K’ Show: www.k-online.de/

Commercial Service Contact:
Kirsten.Hentschel@trade.gov

Automotive Parts and Services

Overview

USD billion

Manufacturing of Parts and Accessories

2012

2013

Change in %

(based on EUR 2012/2013)

Revenue

87.9

93,149

+2.6

Domestic Sales (excl. VAT)

56.3

59,394

minus 0.4

Foreign Sales

31,6

33,753

+3.3

Employees (Ø/year)

291,751

291,205

minus 0.2

Exchange rates: fixed EUROSTAT exchange rates were applied for 2012 (USD/EUR=0.7783) and 2013 (USD/EUR=0.7530) respectively.

Sub-Sector Best Prospects

Emission control technology; engine electronics; automotive semiconductors, innovative lighting technology (LED/laser etc.); Software, IT, Car-to-X communication technology; (smart) driving assistance and infotainment; alternative drives (e.g. electric/hybrid/fuel cell technology) as well as components; “Clean Diesel” technology; lightweight materials such as carbon fiber parts (CFRP); “downsizing” technologies; eMobility; (integrated) mobility services and concepts; range extender technology; efficient and economical battery technology.

Opportunities

Due to Germany’s position as a leading automotive technology provider and its sophisticated market structure, accessing automotive sub-sectors is difficult. However, market opportunities exist for technological innovations and applications. Due to increasingly strict EU regulations and policy, especially regarding emission control, opportunities arise as manufacturers and suppliers have to adapt to the regulatory requirements. Business opportunities exist especially in high-tech sectors, such as innovative materials and components, technology to increase fuel efficiency, alternative drive technology and new vehicle designs, as well as innovative (urban) mobility concepts.

Limitations exist in the automotive aftermarket. It is difficult for U.S. companies to enter Germany’s market for various reasons: warranty concerns, a highly sophisticated market as well as fierce global competition represent high barriers for NTM manufacturers and products, especially for product groups such as lubricants, additives, care products, as well as certain mass market IAM parts and accessories. NTM companies must commit to high investments in marketing and/or local sales staff in order to gain market shares, which can only be achieved through displacement of competitors. Distributors and agents are very reluctant to take on new products and brands, unless the product’s unique selling proposition (USP) is strong and the foreign manufacturer shows commitment to invest in the product development in Germany.

Web Resources

Trade Fairs (selection)

Automechanika (Frankfurt): September 16-20, 2014

eCarTec Munich (Munich): October 21-23, 2014

Engine Expo (Stuttgart): June 24-26, 2014

Essen Motor Show (Essen): November 29 – December 12, 2014

IAA Passanger Vehicles (Frankfurt): September 17-27, 2015

IAA Commercial Vehicles (Hannover): September 25-October 2, 2014

IZB Supplier Fair (Wolfsburg): October 14-16, 2014

Tire Technology Expo (Cologne): February 10-12, 2015

Zulieferer Innovativ (Munich): July 7-8, 2014

Trade Associations:

ASA (German Garage Equipment Association)

GVA (German Association of Independent Automotive Aftermarket Distributors)

VDA (German Association of the Automotive Industry)

ZDK (German Federation for Motor Trades and Repair)

ZKF (German Federation of Body and Automotive Engineering)


Commercial Service Contact:

Felix.Happe@trade.gov

Sporting Goods

USD billion

 

2012

2013

2014 (estimated)

2015 (estimated)

Total Market Size

4.1

4.1

4.2

4.3

Total Local Production

2.7

2.7

2.7

2.7

Total Exports

1.1

1.1

1.1

1.2

Total Imports

2.5

2.6

2.6

2.8

Import from the U.S.

0.9

0.9

0.9

0.9

Germany is Europe's largest sporting goods equipment market and a very sport-minded country. There are 25 million Germans participating in sports activities. In 2013, the German sporting goods market grew by 4% and an approximated average annual growth of 2% is expected over the next few years. The German sports market continues to be a profitable area for U.S. companies for export and investment. Sports activities remain a mega trend in Germany, thus offering excellent opportunities for U.S. sports products, especially those that are "Made in the USA," continue to set trends and enjoy great popularity in Germany.

The German sporting goods industry is characterized by mostly medium-sized enterprises with nearly 120,000 employees. The wide ranging production line (about 10,000 items) splits into three product groups with corresponding percentages of the total annual sales: Sports apparel (56%), sports shoes (30%), and sports hardware (14%).

In 2013, the demand for the all-season segment of outdoor sports increased by 3.9% (market share: 22%) followed by the multi-sport segment with a market share of 18%. Winter sports equipment and accessories accounted for 12%. Running, Nordic walking and racket sports achieved 10% each, and soccer 11% of the total market. The Swimming/beach segment experienced a decrease in sales of 6% (market share: 7%).

Over the last decade, Germany maintained the position of the 3rd largest importer within the EU. Major competitors in the German market come from China (50% import market share), Poland (9%), Italy (8%), the Netherlands and France (both 4%), and the Czech Republic (3%).

About 80% of all exports are purchased by EU member states. The U.S. ranks second after Switzerland among the most important non-EU buying countries, followed by Russia, Japan, Turkey, and, to an increasing degree, China.

The German sporting goods market is expected to grow moderately over the next few years, fueled largely by the fitness and health awareness among broad levels of the population, as well as increasing numbers of elderly consumers taking up a more active lifestyle. Germany already has the largest proportion (25 million) of the 50+ age group – the so-called “Best Agers” – within the EU, which is expected to grow more rapidly than elsewhere. New high-tech materials, technical refinements as well as new innovations within the fibers and textiles industries will continue to play a decisive role as a competitive advantage.

Sub-Sector Best Prospects

Fitness equipment for physical exercise, gymnastics, or track and field; footwear (all sports); golf equipment; team sports equipment (for soccer, basketball, field hockey, golf, handball in particular, riding, running); winter sports equipment and apparel; in-line skates; roller blades; outdoor goods for hiking, climbing, trekking, and Nordic walking activities.

Web Resources

Trade Fairs:

OutDoor, Friedrichshafen, www.outdoor-show.com

EuroBike, Friedrichshafen, www.eurobike-show.com/eb-en

GOLF Europe, Augsburg, www.golf-europe.com/en/home

ISPO, Munich, www.ispo.com

FIBO (Fitness), Essen, www.fibo.de

Trade Associations:
German Sporting Goods Manufacturers Association: www.bsi-ev.com
German Association of Sporting Goods Retailers: www.vds-sportfachhandel.de
European Outdoor Group: www.europeanoutdoorgroup.com
Association of the German Fitness Industry: www.vdf-fitnessverband.de
German Golf Association: www.golf.de

Major Trade Journals:

www.saz.de
www.outdoor-magazin.com

www.golf.de/journal

www.skimagazin.de

www.wassersport-magazin.com

www.reitsport-markt.de


Commercial Service Contact:

Office.Munich@trade.gov

Travel and Tourism

Overview

USD billion

 

2012

2013

2014

(estimated)

Expenditure by German Tourists Abroad

83.2

86,450,000

91,700,000

U.S. Expenditure by German Tourists

7.0

7,500,000

n/a

Exchange Rate EUR:USD

1:1.28

1:1.33

1:1.37

(Sources: “ReiseAnalyse” 2014, Deutsche Tourismusanalyse by Stiftung fuer Zukunftsfragen (BAT), Office of Travel and Tourism Industries, U.S. Dept. of Commerce)

German travel abroad, including to the United States, is expected to show modest growth. Germans are high-spending travelers, and the United States is their most popular long-haul destination. Germans tend to stay longer in the United States than most travelers to the United States, and a wide array of non-stop direct flights to the United States continues to facilitate this travel.

German travel to the United States increased by 2 percent in 2013, with 1,916,000 Germans visiting the United States last year. Forecasts show a 3 percent growth in both 2014 and 2015 and an overall 11 percent until 2018. Germany’s travel and tourism spending in the United States went up to an all-time record of USD 7.5 billion in 2013, an increase of 9 percent compared with 2012. Germany maintained its 7th place in the spending ranking in 2013, behind Canada, Japan, UK, Mexico, Brazil and China. Travel and tourism exports account for 27 percent of all U.S. services exports to Germany.

Germany ranks fourth in arrivals to the United States from overseas, following the UK, Japan and Brazil. (Canada and Mexico are not included). While domestic tourism has become a trend in Germany, the United States continues to be the favorite long-haul destination. The most popular U.S. states for German travelers are New York (33%), California (23%) and Florida (19%), with New York being the most popular city. Other top city destinations are Los Angeles, San Francisco, Las Vegas and Miami. German travelers are also the top overseas visitors in several western states. The average length of stay for German tourists in the United States, 18.3 nights, is considerably longer than for other overseas visitors.

Germans view 2014 optimistically - 55 percent of potential German travelers (aged 14-70) have already thought about their travel plans for the year, according to a recent poll.

Sub-Sector Best Prospects

Outlet shopping packages; city packages including wellness and a unique travel experience; a focus on value for money; all-inclusive packages; nature, hiking and camping holidays; Native American inventory packaged with local attractions and service providers, which should be activity-based rather than language dependent; incentives for small groups.

Opportunities

The Visit USA Committee Germany e.V. together with Brand USA offer partners opportunities to outreach to travel agencies during a Germany roadshow from Sept. 8-11, 2014, in Nuermberg, Munich, Stuttgart and Dusseldorf, and a Halloween event from Oct. 31 to Nov. 2, 2014, in Frankfurt. They also plan a travel media outreach event in Hamburg in late September, 2014, and coordinate participation for U.S. clients at Germany’s major tourism shows, listed below.

Web Resources

Government:

Entry and visa regulations information

http://germany.usembassy.gov/visa/

https://esta.cbp.dhs.gov

Travel Trade Fairs:

TC Leipzig: www.touristikundcaravaning.de

CMT Stuttgart: www.messe-stuttgart.de/cmt

Reisen Hamburg: www.hamburg-messe.de/reisen

f.re.e Munich: www.free-muenchen.de

ITB Berlin: www.itb-berlin.com

IMEX Frankfurt: www.imex-frankfurt.de

Travel Expo & FVW Congress, Trade fair for Tourism, Business travel und Technology in Cologne (B2B fair): www.fvw-kongress.de/

Other:

www.vusa. travel Official site of the Visit USA Committee Germany e.V.

www.discoveramerica.com/de Brand USA’s consumer website in German

www.usa.de German language consumer travel website on United States

www.natuerlichusa.de German landing page for Recreation.Gov

Commercial Service Contact:
Elizabeth.Walsh@trade.gov

Renewable Energies

Overview

 

2011

2012

Changes

2012/2011

Share of renewable electricity in total electricity consumption

20.5 %

22,9 %

+ 11.7 %

Final energy electricity from renewables

123.5 billion kWh

136.1 billion kWh

+ 10.2 %

Share of renewable heat in final energy consumption for heat

10.4 %

10.4 %

0 %

Renewables’ share in total fuel consumption

5.5 %

5.5 %

0 %

Renewables’ share in total final energy consumption

12.1 %

12.6 %

+ 4.1 %

Greenhouse gas emissions avoided through renewables

134 million tons

146 million tons

+ 9.0 %

Investments in the construction of renewable energy facilities

23.2 EUR billion

19.5 EUR billion

minus 15.9 %

Turnover from operation of renewable energy facilities

13.6 EUR billion

14.4 EUR billion

+ 5.9 %

(Source: www.erneuerbare-energien.de)

Exchange Rate: In order to avoid misinterpretation, a fixed USD/EUR exchange rate (1 USD=0.809 EUR) is used for the figures provided in this section.

Despite an ongoing debate about rising energy prices, the renewable energy sector is expected to continue growing. Electricity generation from renewable energies and the appropriate subsidies are substantially based on the German Renewable Energy Sources Act (Erneuerbare-Energien-Gesetz, EEG), which is in accordance with European policy (Directive 2001/77/EC).

Best Products/Services

Wind Energy

Wind energy currently offers the most extensive opportunities for expansion. Technological development in this field is highly advanced. In Germany, wind turbines are exclusively used for the production of electricity which is fed into the grid. Wind turbines produced 45.9 TWh in 2012 (48.9 TWh in 2011). Future wind energy deployment in Germany will require further development of suitable locations on shore and the replacement of old and small installations with more modern and powerful equipment (repowering).

Bio-Energy

By 2020, bio-energy is expected to account for 54 TWh/aelec. or 9.1% of all electricity generation, 150 TWh/athermal or 13% of heating energy, and 111 TWh/a or 21% of all fuels. The major share will come from biogas, followed by solid biomass (mainly wood and plants), liquid biomass (plant oils), and sewage and landfill gas.

Photovoltaic (PV)

PV plants produced 27.9 TWh in 2012 (19.3 TWh in 2011). The production increased by 44% compared with 2011. Solar energy produced 5.0% of the gross electricity generation. In spite of a slight rise in new capacity (7.5 GW in 2011: 7.6 GW in 2012), investments in PV systems dropped by around one quarter. Potential is seen for storage solutions and for distribution systems of hot water via local heating grids. PV systems are supported by the Federal Government with the Renewable Energy Sources Act (EEG). The EEG provides a high degree of planning and investment security due to fixed tariffs over a period of 20 years.

Solar Thermal Energy

Small-scale solar installations are already standard for heating industry and specialized energy segments. The EEG entered into force on January 2009 introduces an obligation to use renewable energies for heat supply in new buildings, for which solar energy is ideal e.g. by using the building’s own solar collectors or by purchasing district heating in combination with a centralized large-scale solar heating system. Both small- and large-scale solar heating systems are supported by the Market Incentive Program. The German solar market is an import market due to high labor costs. A strong trend to decentralized energy supply can be observed.

Hydro Power

Hydro power produced 18.1 TWh in 2012. The share of the gross electricity generation was 3.0%. The potential of hydropower in Germany has largely been exploited. Most hydropower plants operating in Germany were built before the 1960s and the majority is in the 5-10 MW class. Experts state that the present 20 TWh/aelec. that are presently generated can be increased (mainly by repowering existing plants) to over 31 TWh/aelec by 2020 and then account for 5.4% of the electric power generation in Germany. In addition to repowering, major investments are also expected for environmental protection measures for hydro power plant surrounding waterways (fish steps, re-naturalization of riverbeds, and optimization of river flow).

Geothermal Energy (Industrial, deep geothermal energy)

At present, total installed electrical power equals 7.3 MW generating 19 GWh and 6,300 GWhthermal per year. It is expected that this energy form will reach as much as 6,000 MW installed capacity generating 38 TWhelec. and 14,400 GWhthermal by 2020. Surface geothermal energy: In 2011, over 60,000 heat pumps were installed, most in private residences bringing the total number of heat pumps to over 350,000 units. More than half use water-to-water or brine-to-water technology for which vertical drilling or horizontal netting is required. A little less than half use air-to-air heat pump technology, which is expected to carry the highest growth potential.

Grid, Energy Storage, Fuel Cells

The German Government has to expand the country’s grid infrastructure. This means grid-expansion, integration of storage technologies as well as demand-side management with smart grid and smart home technologies respectively. Improving  the power grid, adding storage technologies, building and expanding transmission lines, etc., add up to estimated €550 billion investments by 2020.  An enormous expansion of the high voltage grid system is required. The new grid expansion plan from November 2012 requires 3,800km of new high voltage lines (2,100km DC, 1700km AC) by 2020. At the same time, the grid will become smart, providing business opportunities not only in the hardware sector as mentioned above – but also in the service sector in areas such as automated energy trading, innovative operating models, innovative financing, plant management, remote house control, electricity purchase bundling.

Best potential is seen for energy management / smart grid applications; energy storage (battery) technology; fuel cell technology; green / smart building technology; building automation technology; energy & resource efficiency solutions; lightweight / advanced materials; renewable energy (especially wind); sustainable production technology (environmentally friendly materials, coatings); integrated production IT / industrial automation technology

Web Resources

Trade Associations:

Hydro Energy: Bundesverband Deutscher Wasserkraftwerke e.V. (BDW): www.wasserkraft-deutschland.de/
Wind Energy: Bundesverband Windenergie (BWE): www.wind-energie.de
Solar Energy: Bundesverband Solarwirtschaft (BSW): www.solarwirtschaft.de
Geothermal Energy: Bundesverband Geothermie (GtV-BV): www.geothermie.de
Biogas: Fachverband Biogas: www.biogas.org
Renewable Energy: Bundesverband Erneuerbare Energie (BEE): www.bee-ev.de
Agentur fuer Erneuerbare Energien: www.unendlich-viel-energie.de 

Government:
Federal Ministry for the Environment, Nature Conservation and Nuclear Safety (BMU): www.bmu.de, www.erneuerbare-energien.de
German Energy Agency (DENA): www.dena.de
International Renewable Energy Agency (IRENA): www.irena.org

Other:

Germany Trade and Invest (GTAI): www.gtai.com

Fraunhofer ISE: www.ise.fraunhofer.de

Trade Fairs:
Wind Energy: Husum Wind Energy, www.husumwind.de
Hannover Messe Energy, www.energy-hannover.de
Solar Energy: Intersolar, www.intersolar.de

Geothermal Energy: GeoTherm expo + congress, www.geotherm-offenburg.de
Biogas: Eurotier, www.eurotier.de

Bio Energy Decentral, www.bioenergy-decentral.com
Renewable Energy: Hannover Messe Energy, www.energy-hannover.de
enertec, www.enertec-leipzig.de
RenExpo, www.renexpo.de

Commercial Service Contact:
Sabrina.Leipold@trade.gov

Agricultural Sectors

Product Category
(in USD million)

Total German Imports 2013

German Imports from the U.S.

U.S. Import Growth (2009-13)

Market attractiveness for USA

Tree Nuts

2,100

575

124.6%

The United States is the biggest supplier of tree nuts to Germany. Most tree nuts are used as ingredients by the food processing sector. Almonds are the most important commodity within this category. Further products with good sales potential include pistachios, pecans, and walnuts.

Fish and Seafood Products

5,064

171

The German market offers lucrative opportunities for fish and seafood products. Fish consumption is growing as consumers associate fishery products with a healthy diet. Best prospects for U.S. and seafood exports are salmon, Alaska Pollock, hake, shrimps, crabs (frozen), caviar substitutes, squid, scallops and cod.

Wine and Beer

3,973

105

66.7%

Germany has a high share of domestic wine production. However, good prospects exist for “new world wines” including those from the U.S. The U.S. has also steadily increased its beer exports to Germany.

Processed Fruits and Vegetables

5,685

92

12.2%

German imports are slowly increasing. Those products are mostly used as ingredients by the food processing sector for the production of pastries and cereals. Dried fruits and prepared nuts are also popular as a snack. Commodities with notable increasing sales are raisins, dried prunes, dried onions, and dried mushrooms & truffles.

Red Meats Fresh/Chilled/
Frozen

5,318

69

2364.29%

Good opportunities for U.S. high quality beef produced without growth hormones. The EU quota size and administration system have recently seen changes.

Snack Foods (excl. Nuts)

3,478

8

14.1%

German demand for healthy, organic, innovative, and exotic snacks continues to grow. U.S. import growth has expanded in this category predominately due to increasing imports of cocoa preparations and chocolate.

Pet Foods (Dog and Cat)

944

2

Sales of cat food have the biggest market share. U.S. exports are declining but potential exists for premium pet food.

U.S. Embassy Contact:
Office of Agricultural Affairs: agberlin@usda.gov