Last year, 2019, was the ninth consecutive year of growth for packaging machinery manufacturers from Germany.
According to the Federal Statistical Office, the approximately 250 mainly medium-sized companies produced packaging machinery worth around 7.3 billion euros, an increase of 2 percent. The production of beverage packaging machines increased by 4.3 percent to 2.3 billion euros. The production of other packaging machines increased by 1.2 percent to just over 4.9 billion euros.
While the production figures for packaging machinery in the first three quarters of 2019 still showed a total increase of 8 percent, they fell in the fourth quarter by 10 percent below the previous year’s figure. The slowdown in demand in the second half of the year was already affecting the German production.
Europe remains largest sales region
Half of all German packaging machinery exports went to European countries. The delivery volume reached a value of 3 billion euros and was thus 3.1 percent above the previous year. Asia purchased machinery and equipment worth just over 1.1 billion euros (plus 16 percent) and North America worth 886 million euros (plus 8 percent). Deliveries to Africa amounted to 351 million euros (plus 1 percent). Less positive was the development of the export business to Latin America, the Near and Middle East and Australia-Oceania. Exports fell by a double-digit percentage.
USA largest single sales market
With an export volume of 786 million euros (plus 7 percent), the USA remained the largest single sales market for packaging machines made in Germany in 2019. China is in second place with 451 million euros (plus 23 percent), followed by France (309 million euros, plus 3 percent), Poland (296 million euros, plus 9.5 percent) and the United Kingdom (248 million euros, plus 18 percent). Exports to Russia increased by 5 per cent to 203 million euros. This puts the country in eighth place among the ten largest export markets, after Spain (234 million euros, up 24.5 percent) and the Netherlands (219 million euros, up 29.1 percent).
Outlook: Everything open
It is currently impossible to estimate or quantify how the packaging machinery industry will develop in 2020. Due to the weak order activity in the second half of 2019 and, in particular, the drop in foreign orders, the German Food Processing and Packaging Machinery Association already assumed in its November 2019 forecast that production of packaging machinery would decline in the current year.
“The extent of the decline caused by the outbreak of the corona crisis and the consequences associated with it will only become really clear in the coming months,” says Richard Clemens, managing director of the VDMA Food Processing and Packaging Machinery Association.
Companies are increasingly feeling the effects of the corona pandemic. In addition to disruptions in the supply chain, especially in Europe, disruptions on the demand side in particular have increased further. Not only are fewer orders coming from Europe, but also from Asia and North and Latin America. Order intake in the first quarter was down 19 percentage points year-on-year. If this trend continues, it will continue into the coming year.
“However, we are optimistic that demand will recover quickly following the easing of government restrictions. The increasing global demand for hygienically packaged and safe food and pharmaceutical products is a major contributor to this,” says Clemens.