The industry body also predicted that a further 6,800 jobs could go in the industry after more than a third of all companies taking part in the investigation said they expected to cut staff over the next 12 months.
The BPF has highlighted what it calls the “serious problem" of companies increasingly being unable to obtain the insurance against bad debt. The situation has deteriorated dramatically since the start of the year with some 79 per cent of plastic companies currently experiencing difficulties in securing the vital insurance compared to 48 per cent in January.
Peter Davis, Director-General, BPF said: “The latest survey has really highlighted the severity of credit insurance problem facing the industry. This is not only affecting plastics companies now, but it also has the potential to seriously blunt the impact of the recovery.”
The problem is being felt across the EU said industry organisation Flexible Packaging Europe. The group said it understood the issue was most acute in Spain, Italy, Germany as well as the UK, where insurance was either becoming harder to secure or premiums were increasing.
A spokesman told FoodProductionDaily.com that industries – such as plastic converters - with a higher proportion of small or medium-sized entities were being hardest hit. However, he stressed the problem was being felt across all sectors of the economy as one of the main consequences of the credit crunch.
“In general the consequence of this are that companies reduce their contract sizes or they take on part of the risk themselves,” he explained.
No green shoots
In the UK, sentiment in the plastics industry was also revealed to be pessimistic with the BPF declaring “the industry appears to be bouncing along the bottom of a deep trough”. Its survey found 44 per cent of companies expected their UK sales turnover to remain stagnant over the nest 12 months, while 35 per cent expected a modest increase of between five and 10 per cent.
“The survey does indicate some increased confidence in UK and export sales, but certainly no ‘green shoots’ and, like other manufacturing sectors, there are more job losses to come,” said Davis.
The companies surveyed were also fearful of increases in energy and raw material prices in the next 12 months which could potentially serve to stifle recovery.