German paper sack industry: lower demand in 2023
The German paper sack industry closed 2023 with a decline in sales: it delivered 22.6% fewer paper sacks than in the previous year1. The members of Gemeinschaft Papiersackindustrie e.V. (GemPSI) attribute the downward trend to a slump in sales in their largest market segments and high stock levels at their customers. Nevertheless, they rate their business situation in 2023 as satisfactory2. This was the result of this year‘s industry barometer survey. This issue focuses on the paper sack market for building materials, by far the largest sales market for the German paper sack industry.
The German paper sack industry delivered around 654 million paper sacks in 2023. This corresponds to a 22.6% decline in sales compared to the previous year. Nevertheless, it still occupies a leading position in Europe. The markets for cement, chemicals, minerals and miscellaneous3 achieved weaker results than the market as a whole. Food excluding milk powder and building materials excluding cement performed slightly better. There were fewer downward fluctuations in the animal feed and seed segments. The market for milk powder remained at roughly the same high level as the previous year. GemPSI members still rate the satisfaction of the business situation in 2023 as satisfactory with a value of 3.4 points4, despite the losses.
Looking back on a challenging year
GemPSI members attribute the falling demand for paper sacks to high stock levels at their customers, who ordered around 8 to 12% more sacks in the previous year to build up safety stocks. This led to a decline in orders in 2023. In addition, the economic situation also had an impact on the development of the German paper sack market. Almost all market segments of the German paper sack industry were affected by lower demand. This was particularly noticeable in its largest sales markets. For example, the production of building materials and chemicals fell significantly in 2023.
Trends 2023: further sustainability
aspects in focus
According to GemPSI members, their customers continued to place a particular focus on various sustainability criteria last year. For example, demand increased for the use of recycled materials in paper bags as well as the carbon footprint and recycling score of their packaging. This indicates how well fiber-based packaging can be recycled. “There is a lot of movement in the area of sustainability, not least against the backdrop of the EU Packaging Regulation,” explains Alfred Rockenfeller. “Our customers can already look forward to interesting further developments and product optimizations from our members.”
Different business forecasts for 2024
According to GemPSI members, most market segments will reach a similar level to 2023. Some are more cautious about the development of building materials (excluding cement) and chemical products. Nevertheless, GemPSI members rate their business prospects as satisfactory with a score of 3.2 points5. They cite various reasons for this: The continuing difficult geopolitical situation, upcoming political decisions, high energy and building material costs as well as long delivery times are slowing down Germany’s economic development as an export-dependent business location. On the other hand, they are confident that the market will slowly return to normal after the turbulent years. With their products, innovative strength and flexibility, GemPSI members feel well positioned in the market and rate their starting position at 1.8 points6.
In focus: paper bags
for building materials
Including the cement sector, paper sacks for building materials held a market share of more than 50% in 2023, making this segment a key market for GemPSI members. The German paper sack industry delivered around 270 million paper sacks for building materials and around 74 million cement paper sacks. According to the respondents, building materials manufacturers pay particular attention to efficient filling speeds, good product and moisture protection as well as a long shelf life and various sustainability aspects when choosing packaging. GemPSI members feel well positioned (2 points7) in the market with their product portfolio for building materials. They state that they have made numerous optimizations to their packaging, including in the areas of product protection, recycling score and CO2 footprint. GemPSI members assume that sustainability aspects will become even more important for their building materials customers in the next five to ten years and are actively working on the further development of their services and products in this area. In addition to improving product protection, they consider the increased use of recycled materials in paper bags and the promotion and further simplification of the recycling of building material bags to be particularly important. “We always make sure that we offer products and services of the highest quality,” says Rockenfeller. “In future, we plan to communicate this even more prominently.”
The content of the industry barometer was compiled using a questionnaire and desktop research based on relevant third-party publications. The entire industry barometer, including detailed figures and comprehensive explanations, can be downloaded here: www.papiersack.de/medien/publikationen/
to 5 “very poor”
