Nearly three out of five German industry associations are pessimistic about next year and expect their companies to produce less as high energy prices due to the war in Ukraine show no signs of abating, found a survey published Tuesday.

Of the 49 associations surveyed by the IW economic institute, 30 said they expect their members to produce less, while 13 said they expect their sectors to produce more.

Nearly 40 associations said the current situation for their companies is worse than a year ago, when many assumed that the worst of the coronavirus pandemic had been mostly overcome.

With inflation at record highs, however, the mood in the German economy has not recovered, according to the survey, which was conducted from mid-November through early December.

"Businesses do not expect the high energy prices to fall back to pre-crisis levels in the foreseeable future. That clouds the outlook for the coming year enormously," said IW economic expert Michael Groemling.

He warned that the situation for energy-intensive firms was particularly precarious and their success is tied to affordable energy. (Reporting by Miranda Murray, editing by Kirsti Knolle)