Cosmetics feed growth for aluminium packaging in Germany

By Rory Harrington

- Last updated on GMT

Related tags Material Cost

Germany experienced a “significant increase “ in turnover for aluminium packaging across cosmetics as well as food and pharmaceuticals in 2010 as the sector recovered from recession, said the national trade body.

But the Gesamtverband der Aluminiumindustrie e.V (GDA) warned that high prices for input costs was “clouding the big picture” and a threat to the competitiveness of the sector.

Demand up

The industry group said overall production of packaging based on - or including aluminium - rose by 13.6 per cent last year. Some 405,100 tons of aluminium foil, tubes, flexible packaging, and aerosol and beverage cans produced by manufacturers in Germany, in 2010 compared to 356,000 tons the year previously.

“We estimate there was a 5 per cent increase in food packaging and around 10 per cent each for the pharmaceutical and cosmetic packing sectors,”​ GDA executive director Stefan Glimm told CosmeticsDesign-Europe.com.

“In terms of production, we have almost reached the level we were at before the crisis. The good situation is being clouded, however, by rising prices for raw materials and higher operating costs, which are squeezing margins.”

The aluminium packaging sector is benefiting from strong consumer sentiment – with climbing demand seen both in the domestic and foreign markets, said GDA aluminium foil chairman Manfred Mertens.

He added that export sales accounted for about 70 per cent of the turnover of the companies in the sector.

Outlook

The organisation said it was “optimistic” for 2011 and predicted that growth in the aluminium packaging sector would be in line with general economic forecasts. It said the first quarter had been characterised by “high orders and stable demand”.

“Functionality, convenience and creative design are just some of the facets that today’s aluminium packaging has to offer. It protects significantly more resources from deterioration and waste than are needed for its own production,”​ said Dr Monika Kopra-Schäfer, chair of GDA’s Tubes, Cans and Impact Extrusions division,

Rising raw material costs

But sector experts expressed concern about increasing costs for energy and raw material across a range of material.

“Strong, double-digit percentage increases in the cost of plastics, printing inks and lacquers are exerting a significant squeeze on aluminium packaging manufacturers’ margins,”​ said the GDA.

There is also disquiet at some raw material shortages – such as for bought-in plastics – due to delivery bottlenecks. The GDA said it had anecdotal evidence that there had already been isolated incidences where this physical shortage had disrupted production.

High energy costs and the 70 per cent increase in the Renewable Energy Sources Act levy - representing a rise of 1.4 ct/kWh to approx. 3.5 ct/kWh, - will also place a burden on medium-sized businesses, said Dr Kopra-Schäfer.

“When competing internationally, additional costs like these, which also include the costs of the eco-tax, are difficult to absorb,”​ she added.

The industry body flagged up further potential cost increases resulting from emissions trading.

Related topics Packaging & Design

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