Germany

The German plastics industry seems largely to have survived a crisis-hit 2022. After the difficult years of the pandemic and the outbreak of the Ukraine conflict, the economy seems to have come to terms with being in a permanent state of crisis.

The second half of 2022 was worse for most companies than the first half, with particularly steep declines for construction supplies and consumer goods. Looking ahead rather than back, the outlook for 2023 may not be good but seems set to be better than 2022; there is a positive attitude, and orders and production should increase.
The major challenges for this year include still-high material costs and rising energy bills, making entrepreneurs cautious about investments in 2023 as healthy liquidity is more important than tying up money in machinery or buildings over the long term. Rising energy costs could also lead to further sales problems as prices have to be adjusted. Many companies are trying to mitigate these higher costs by focusing more on saving energy and increasing efficiency than on reducing production.

This testing situation is being aggravated by the industry-wide shortage of skilled workers and by rising wage costs. On the positive side, at least there has been some easing in the areas of transport and logistics.

Sales of materials fell sharply in the latter part of 2022 as, on the one hand, companies did not want to build stocks at the end of the year and, on the other, there was less work almost everywhere. Warehouses were replenished once again in early 2023 but not to the extent of previous years because many companies only resumed work in the second half of January. Prices for standard regranulates are still in downward mode, with a few exceptions such as PS. For regranulators, the hope for February is that demand will increase and prices will stabilize.