The decline in overall economic output in Germany in 2023 had significant negative consequences for the corrugated board industry, which plays a key role in supply chains as the number one supplier of transport packaging. "The hoped-for economic recovery was a long time coming in 2023. Although our industry experienced more stable conditions for the first time after the turbulent ups and downs of previous years, the negative overall situation meant that sales, incoming orders and production were at a significantly lower level. As a result, we had to accept considerable losses compared to 2022", said VDW Chairman Dr. Steffen P. Würth at the balance sheet press conference.
Corrugated Board Prices Adjusted
In 2023, the companies organized in the VDW recorded a drop in sales of 8.1 percent compared to the previous year. At 7,348 million square meters, corrugated board sales fell by 681 million square meters compared to 2022. The losses in sales were even greater: A year-on-year drop of 13.8 percent was reported for 2023. The last time the industry experienced a similarly sharp drop in sales was in 2009 in the wake of the financial crisis.
Average revenues also fell: the decline over the course of the year amounted to a total of 13.3 cents per square meter. "As corrugated board is still by far the most important transport packaging in Germany, accounting for 67.1 percent of sales, and our industry is therefore closely linked to the overall economic development, the severe losses are not surprising. However, they also clearly show that the corrugated board industry continued to be under severe pressure in 2023", explained Würth. Despite this situation, the VDW members had reacted to the reduced price pressure on corrugated base paper and adjusted their own prices. As the voice of the corrugated board industry, the VDW currently represents the interests of 31 member companies with around 100 plants. According to its own figures, the association thus represents over 80 percent of German corrugated board production.
"In the midst of a challenging macroeconomic situation, our customers were therefore able to benefit from the fact that the corrugated board industry relieved the pressure on the customer side", says Würth. This was all the more true as the average corrugated base paper price had settled at a high level from summer to fall 2023, which was still well above that of the pre-pandemic year 2019. Costs also increased in many areas in 2023, such for personnel.
EU Decision as a Milestone
the political side, the corrugated board industry was particularly confronted with the challenge of the European Packaging Regulation in 2023. The European Commission's original draft would have meant unjustified cuts for corrugated packaging. A provisional agreement was then reached in the subsequent trilogue process in March 2024, which would enable the corrugated board industry to continue to make its contribution to the circular economy in the future.
"The fact that the European Parliament has now approved this trilogue result in yesterday's session represents another important milestone on the way passing the bill", said the VDW Chairman. Corrugated board has a recycling rate of 95.3 percent, he added.
Forecast More Encouraging
For the current year, Würth and VDW Managing Director Dr. Oliver Wolfrum expect the corrugated board companies to remain at the previous level for some time to come. It will still take a lot for the mood to become good again.
Thomas Wund, Head of Marketing at HANS KOLB Wellpappe GmbH and member of the FACHPACK Advisory Board, commented on the annual figures: "Like other sectors, we are operating in a particularly dynamic market and competitive environment, and last year we still had free capacity available for planning. Post-corona effects for our customers, energy price challenges for the entire industry and high raw material availability were aspects that kept us busier than usual." Wund is optimistic about the coming months: "We are currently seeing a pleasing upturn in demand, which confirms that we have set the right strategic course in the recent past."
