VDMA Plastics and Rubber Machinery reports Q1 drop in sales

Orders for German plastics and rubber machinery plummeted 27 percent in the first quarter of 2022 compared to the same period in the previous year while overall sales increased by just 3 percent.
High demand from the packaging and medical sectors fuelled demand in 2021 so the drop could partly be attributed to a base effect.
However, other factors have made it difficult for machine and equipment builders to process the orders and convert them to sales, according to officials of the mechanical engineering industry association VDMA, which is based in Frankfurt, Germany.
"First and foremost, there is the poor availability of materials," said Thorsten Kühmann, Managing Director of the VDMA Plastics and Rubber Machinery Association in a news release.
The war in Ukraine and China’s strict zero-covid policy also have contributed to logistics problems and greater uncertainty in the market, which are having a negative effect on business.
As a result, the trade association is scaling back its original forecast that projected growth of 5 to 10 percent, saying it’s no longer realistic for 2022.

"Due to the ongoing developments on the procurement market, we only expect a sideways movement or, in the best case, a slight increase in turnover for 2022 – despite full order books. We expect a development of zero to 2 per cent," Kühmann said of the new outlook.
Some 200, mainly German, companies are members of the VDMA Plastics and Rubber Machinery trade association, although 10 percent are based in the neighbouring countries of Switzerland, France and Austria.  
Its German member companies represent sales of about 7 billion euros in core machinery and 10 billion euros including peripheral technology.
According to the association, every fourth plastics machine manufactured worldwide comes from Germany in terms of value.
Meanwhile, the Italian sector released results last week from the latest member survey of Amaplast that shows a 14 percent growth in production for the year 2021, with value exceeding pre-pandemic levels.
For the first quarter of 2022, Amaplast reported a 28 percent year-over-year increase in demand, particularly in overseas markets.
Amaplast’s outlook for the second quarter also shows optimism with incoming orders expected to grow by another 6-7 percent.
However, Amaplast officials also said it was difficult to “venture forecasts” for the coming months as there are many factors that may influence the performance of the industry. They pointed to the war in Ukraine, limited manufacturing supplies and higher energy costs as well as the Covid-related closures in China, including the port of Shanghai.
“Companies thus find themselves operating in an exceedingly complicated and also paradoxical situation. In spite of the above issues, orders continue to accumulate and it may become complicated for many companies to fulfil them,” the association said.