The German Industrial Association for Plastic Packaging (IK) has released the results of its economic survey for the fourth quarter of 2024.
Results show a ‘mixed picture’ amongst IK members regarding the current economic situation and forecast for 2025, the association said in a statement. Manufacturers unanimously agree, however, that more political support is needed to support the transition to a circular plastics economy.
The survey revealed that 39% of IK members are pessimistic about sales prospects in Q4, up from 30% in Q3.
The sentiment is mostly driven by a decline in export expectations, with the proportion of companies reporting worsening expectations increasing by 8 percentage points. Nonetheless, over 60% of companies said the export situation has not worsened throughout 2024. Last year, the German plastic packaging industry generated over 45% of its sales through exports.
Most companies agreed the development of sales prices has been ‘stable’. However, the proportion of companies that assessed their earnings situation as better than in the previous quarter has fallen to 2%, down from 10% in Q3. At the same time, the proportion of companies that fear a deterioration in their earnings situation has increased by 5 percentage points to 54%.
Accompanying expectations of weaker sales, 29% of companies said they expect a decline in the number of their employees, an increase of 11 percentage points relative to last quarter. On the other hand, for the first time this year, the proportion of companies expecting an increase in the number of employees has increased to 9% from the 4% in the previous quarters.
"The circular economy of sustainable plastics as the market of the future is a huge opportunity for our industrial location, especially in the current crisis, if we give the 300 member companies with their 90,000 employees room for development and secure guard rails,” said IK President Georg Pescher.
The association argues that ‘detailed and biassed regulation of plastics and the unjustified double and triple financial burden are real brakes on the path to a circular economy’. It has criticised the EU’s Packaging and Packaging Waste Regulation (PPWR) for allegedly lacking ‘material neutrality’ and being biassed against plastic.
IK also reiterated that high energy prices continue to weaken German companies against their international competitors.