GERMAN PACKAGING MARKET
Trade group survey sees end of downward sales trend / Earnings projections remain negative
 German packaging producers expressed more optimism about the coming months (Photo: mo) |
After the outlook for sales fell to a historic low in the course of last year, survey results from the German plastic packaging association Industrievereinigung Kunststoffverpackungen (IK, Bad Homburg; www.kunststoffverpackungen.de) offer some hope about the future.
“The downward trend seems to have come to a halt, with both the general economic climate and sales expectations being viewed less gloomily than in the autumn,” IK managing director Martin Engelmann said.
Drastically increased electricity and gas prices in Germany are dampening the outlook for the first quarter of 2023. The portion of IK members expecting a decline in sales over the first few months of 2023 has, however, fallen considerably and now stands at 56% compared with 70% in the previous quarter. Earnings expectations of the German packaging companies are also predominantly negative, with 65% of members expecting a fall, which improved from 78% in the previous three months.
The outlook in terms of general economic development is considerably more positive, the trade group said. Two out of three companies rated the current situation as satisfactory. Only half of respondents were of this opinion in the previous quarter.
Related: Crisis mode becomes the norm for plastics industry in German-speaking Europe
“The downward trend seems to have come to a halt, with both the general economic climate and sales expectations being viewed less gloomily than in the autumn,” IK managing director Martin Engelmann said.
Drastically increased electricity and gas prices in Germany are dampening the outlook for the first quarter of 2023. The portion of IK members expecting a decline in sales over the first few months of 2023 has, however, fallen considerably and now stands at 56% compared with 70% in the previous quarter. Earnings expectations of the German packaging companies are also predominantly negative, with 65% of members expecting a fall, which improved from 78% in the previous three months.
The outlook in terms of general economic development is considerably more positive, the trade group said. Two out of three companies rated the current situation as satisfactory. Only half of respondents were of this opinion in the previous quarter.
Related: Crisis mode becomes the norm for plastics industry in German-speaking Europe
Shortages abate, staffing cuts less likely
Concerns about raw material availability have eased since summer 2022 for standard plastics. Specialities like EVOH and even PA have remained scarce and expensive according to IK. Nearly 70% of respondents said they expect no changes here. Notably, a quarter anticipate improvements. “Unfortunately, in many cases the reduction in raw material prices is being more than wiped out by the high energy prices”, Engelmann complained.
Differences do, however, emerge on members expectations regarding the development of sales prices over the next quarter, with 44% of companies forecasting a rise versus 50% last quarter. But 30% reckon with declines, an improvement from the previous mark of 24%.
Related: Material prices for flexible packaging fall in Q4
The negative outlook for economic development had meant that more than 30% percent of companies were expecting a drop in employee numbers in Q4 2022. This pessimism trend has eased. For the Q1, 23% of companies foresee a lower headcount, 70% expect employee numbers to hold steady, and 7% say they anticipate the addition of more staff.
Differences do, however, emerge on members expectations regarding the development of sales prices over the next quarter, with 44% of companies forecasting a rise versus 50% last quarter. But 30% reckon with declines, an improvement from the previous mark of 24%.
Related: Material prices for flexible packaging fall in Q4
The negative outlook for economic development had meant that more than 30% percent of companies were expecting a drop in employee numbers in Q4 2022. This pessimism trend has eased. For the Q1, 23% of companies foresee a lower headcount, 70% expect employee numbers to hold steady, and 7% say they anticipate the addition of more staff.
13.02.2023 Plasteurope.com [252104-0]
Published on 13.02.2023