FRANKFURT, (Reuters) – Germany’s BASF raised its 2021 earnings guidance Wednesday as large industrial customers were willing to accept higher prices for basic chemicals in the face of a raft global material shortage.

According to the statement, the world’s biggest chemical maker in terms of sales stated that it expects 2021 earnings (EBIT) to be between 7.5 and 8.3 billion Euros ($8.7 to $9.3 billion). This is compared with a prior forecast of 7.0 to 7.5 Billion euros.

The adjusted operating earnings for the third quarter, which is when there was a seasonal lull that normally dampens sector demand, rose to 1.87 billion euro, an increase of 581 million euros from the year-earlier pandemic-stricken period. Analysts had expected it to be around 1.8 billion.

The average price increase of 36% led to a 42% jump in revenues for group members, which reached 19.7 billion euro.

Even though there was a shortage in microchips for the automotive sector, and China’s power outages, demand rose.

According to the company, “Growth momentum has slowed in comparison with the last quarter due supply bottlenecks at many value chain of the manufacturing industry.”

BASF’s core chemicals unit was able to reap the benefits, but global material shortages caused by higher costs and greater procurement cost proved costly for businesses like BASF that produce more advanced products, such as agricultural pesticides and nutrition supplements. Profits were also affected.