What are the main causes?
Dr Overath: There are various factors for Germany. The main cause is the sharp decline in exports, as foreign demand for empty glass has fallen. Another factor is the changes in stock levels: During the corona pandemic and the gas shortage crisis, glass manufacturers, customers, and retailers all built up stocks, which are now being reduced. Consumer demand has also fallen, which is due to inflation. The migration to competitor products and reusable products also plays a role, albeit a minor one.
How does the development look when you look at the individual markets in Europe?
Dr Overath: As I said, there was an overall drop of eleven percent in the EU. Our most important markets are France, Poland, and Italy. There were declines everywhere, up to 33 percent in France. This also applies to other countries, with Croatia and Slovenia showing a clear upturn. Our industry has little influence. The bottlers are crucial: They determine demand.
What role do changing consumer habits play, such as the trend towards less alcohol consumption?
The trend is there, but it is also season dependent. Alcohol consumption is falling over a longer period of time and consumers are increasingly turning to non-alcoholic beverages. According to the Federal Statistical Office, the production of non-alcoholic beers increased by 4.1 per cent in 2024.
There is also a trend towards non-alcoholic wines. But glass is the preferred packaging material, so there is an opportunity here for the glass industry. Non-alcoholic beverages are on the rise. And there is another trend – towards reusable packaging.
To what extent do the increased energy costs affect the pricing and competitiveness of container glass?
The production of container glass is energy intensive, and we are affected by the high energy costs. We are one of the energy intensive industries and everyone is struggling with this. Energy costs are still higher today than they were before the crisis. They have been falling for a few years, but we are still a long way from reaching the old level. Producers in Germany are at a competitive disadvantage here.
Does this mean that politicians need to take action?
Yes, the new government must take action regarding this; an industrial electricity price has been under discussion for some time. The grid fee system is also currently being revised, and it is urgently necessary for the glass industry to continue to receive a reduction in the grid fee. At European level, we are campaigning for the glass industry to be included on the EU electricity price compensation list as part of emissions trading.
So far, only a very small part of the glass industry is on the list, but we need to get there. To decarbonize glass production, we need green electricity and hydrogen, but the energy infrastructure for this is not yet in place and setting it up leads to high infrastructure costs. Relieving this burden is also extremely important.
What other expectations do you have of the new government?
In general, we need more planning security for upcoming industrial projects and a real reduction in bureaucracy. We also need to achieve a higher recycling rate. There is still potential here. But that’s not up to us. Consumers are collecting more glass, but a lot still ends up in household waste. We have been raising awareness of this for years with our “What goes into used glass bins” campaign, but we would also like to see more political support for this issue.
Raw materials are another cost factor. How do you assess the current and future supply of raw materials?
Yes, raw materials are becoming more expensive, as the production of soda, for example, is energy intensive. However, we have no problems with the supply of raw materials and none are expected. Germany is not as poor in raw materials as is often said, and we have 98 percent of the mineral raw materials we need for glass production here in Germany. That is our great advantage. We don’t have any problems regarding recycling either, on the contrary: as I mentioned earlier, we could use even more cullet if more used glass was collected.
To what extent is the container glass market affected by regulatory requirements such as the Packaging Act or EU law?
The new European Packaging Regulation, PPWR, is keeping us very busy. However, we have major advantages here that we need to emphasize even more strongly and position ourselves accordingly. Our products are 100 percent recyclable. We have everything we need to capitalize on this. We can fulfil the required quality standards. Our aim is to communicate this to the outside world.
The issue of minimizing packaging is challenging. Of course, we can standardize glass packaging, but diversity and branding suffer as a result. Balancing interests in these areas will be an important issue.
Overall, it contains obligations that mean a great deal of work for companies. For example, in addition to pallets and layer pads, which are already reusable, shrink film is also to become reusable in future. However, this cannot be realized in practice for many reasons, not least for reasons of hygiene. We are hoping for a regulation here. Much is still unclear, and we are very actively involved in the process to prevent the creation of unnecessary bureaucracy.
Author: Wolfram Marx
