German Chancellor Angela Merkel's conservative party scored a convincing victory over their centre-left rivals in a state poll Sunday seen as the first test ahead of national elections.

The Christian Democrats (CDU) won 40.7 per cent of the vote to the Social Democrats' (SPD) 29.6 per cent in the small south-western state of Saarland, first official results showed.

Opinion polls ahead of the vote had put Germany's two main parties neck-and-neck in the state with just under 1 million people.

But in the end the CDU actually bested its performance compared to the last election in Saarland in 2012, when it was the top vote-getter at 35 per cent.

It was a stinging setback for the SPD, which had been riding a wave a momentum since the arrival from Brussels of charismatic EU bureaucrat Martin Schulz, who was picked to be party leader in January.

After years of listlessness, the SPD rose around 10 percentage points in opinion polls in the wake of Schulz's announcement that he would seek to unseat Merkel in Germany's September 24 federal elections.

The rejuvenated national poll numbers came to be referred to as the the "Schulz effect."

But Schulz, who served as president of the EU Parliament for five years, conceded Sunday that there was "no sugarcoating" the CDU's victory in Saarland.

"This is certainly not a happy night for us - not for me either," he told supporters. "When I came here I had hoped we would end up at eye level, maybe even ahead."

The far-right and anti-immigrant Alternative for Germany (AfD) garnered 6.2 per cent of the vote, meaning that Saarland will become the 11th of Germany's 16 states where it has cleared the 5-per-cent hurdle necessary for representation.

Despite the parliamentary breakthrough, the result is a relatively poor one for the AfD, which is polling at around 9 per cent at the national level.

Europe's refugee crisis, which once fuelled support for the AfD, has since faded as a major issue and the party has been dogged by infighting.

AfD chief Frauke Petry said she was "proud" of the result. But she expressed disappointment that voters had chosen to maintain Saarland's so-called "grand coalition" between the CDU and the SPD, saying the constellation "promises only stagnation."

Merkel, who has headed three consecutive governments since 2005, is seeking to win a fourth term in office and the Saarland poll was widely considered a first test of her chances.

Two more state elections - scheduled for May 7 in Schleswig-Holstein, the country's northern-most state, and May 14 in the western state of North Rhine Westphalia - will provide further evidence of where voters stand going into September's nationwide vote.

The chancellor has come under fire at home for her decision to open German borders to hundreds of thousands of migrants in 2015. She has also been accused of shifting her party to the left and co-opting some of the SPD's policies, thereby fuelling the rise of the AfD.

Saarland's Left Party, under the powerful former finance minister Oskar Lafontaine, won 12.9 per cent of the vote, making it the third-strongest party in the state.

Meanwhile, both the environmentalist Greens and the business friendly Free Democrats (FDP) fell short of the 5-per-cent vote share required to re-enter the state parliament.

Final official results were expected early Monday.

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