coronavirus / Germany

Challenge for the German packaging industry

Article by Jasmin Rainer (adapted for, translated by Eva Guzely) | 16.03.2020 - 09:31

The virus is slowing down the economy in Asia and has immediate repercussions on German exports as well as imports. The HPE member companies (German wood packaging, pallet and export packaging association) feel this when it comes to their customers. Therefore, many HPE members support their customers by providing storage places and by temporarily storing already packed goods.

“However, customers of HPE members are increasingly lacking vendor parts from Asia but also buyers from the big growth markets which has repercussions on production in Germany and as a result, also on wood packaging and pallet producers,” says Marcus Kirschner, manager of HPE.

Another problem according to the HPE: On the German raw material market, a particularly critical situation could arise for the German forestry and timber industry. “The accumulation of big volumes of damaged wood is an enormous financial and personnel-related challenge for forestry companies. The export of softwood logs to Asia is the most important relief valve for markets because sawmills have reached capacity limits as well,” explains Kirschner. According to the Main Association of the German Timber Industry (HDH), softwood log exports rose to more than 2.3 million m³ in the period January to November 2019. Softwood sawn timber exports to China show a similar year-on-year development with volumes increasing from around 90,000 m³ to over 560,000 m³.

“The situation is a double burden for wood packaging producers due to the big volumes of damaged wood on the timber market, which is now facing the possibility of losing an important drain valve because of the coronavirus epidemic, but also due to bottlenecks in supply and losses in sales recorded by customers,” says Kirschner. The German wood packaging industry needs flawless fresh wood to meet, among other things, the requirements of the ISPM 15 standard. “For that, the corresponding capacities must be available in forests and sawmills. As to customers, stable markets are essential for all products which are transported in or on wood packaging,” confirms HPE’s manager. Of course, the wood packaging industry also gives priority to preventing the further spread of the virus. Kirschner concludes: “Company pandemic plans regulate what to do at which escalation levels and who is responsible for what. All of this aims at protecting the health of employees and business as well as at ensuring the usual and valued ability to deliver. Because one thing is certain: Even if there are no toilet paper, disinfectants or flour on the shelves in many places – it takes pallets to transport the goods to the shops and wood packaging to bring the machine spare parts to the manufacturers of these goods.”