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Plastics Industry Sees Partial Increase In Demand From Covid-19

Around half of all companies in the plastics sector saw order increases in April. However, increased PPE plastics demand is offset by slump in demand in the auto supplier sector.

Demand for acrylic glass up 

Manufacturers and retailers are currently benefiting from the high demand for acrylic glass - the generic term for brands like Plexiglas. "People no longer ask about the price, now they don't even ask about the color," says Joachim Wehmeyer of the Einkaufsverband deutscher Kunststoffhändler (EVDK), an association of 19 medium-sized companies. "At the moment almost everything is sold."

The current situation is such that plastics dealers are now even able to get rid of discs in special colors that had been lying dormant in the warehouse for months. Wehmeyer says that many plastics dealers have therefore made use of their long-standing contacts and agreed on contingents with various manufacturers.

"We have secured a large part of the required quantities and expect regular deliveries over the next few months."

Joachim Wehmeyer, EVDK

“Flexible Packaging” market to grow by five percent

According to forecasts made by the market research institute Wood Mackenzie, the demand for "flexible packaging" for end consumers in Europe will increase by 5 percent this year - although demand fell to below 1.5 percent last year.

Around Easter, the demand for acrylic glass sheets rose sharply. "In the meantime, all manufacturers are fully booked for the next few months," says the association coordinator. Customers placing new orders with producers today are typically given fall delivery dates. 

Self-confidence returning to plastics industry

The industry is currently experiencing a resurgence in self-confidence. Before the Coronavirus pandemic, politicians were more concerned about how to reduce the use of plastics and where their use should even be prohibited. "I think that sustainability is still in people's minds," says Wehmeyer. "But you recognize that plastic has a right to exist in certain areas." Transparent sheets that are easy to disinfect are a very timely example. The only alternative to plastic would be glass panels that are not only heavier but much more expensive than plastic.

Half of companies report increased order demand

The IK Industrievereinigung Kunststoffverpackungen (German Association for Plastics Packaging and Films) surveyed its member companies on the effects of the Covid-19 crisis at the end of April. The answers of the more than 120 mostly medium-sized companies show how differently the manufacturers of plastic packaging are affected:

  • Almost 50 percent of the companies reported an increase in orders (ranging between 10-20 percent).
  • 37 percent of the companies stated that they had fewer orders overall. 
  • 1/4 of all companies reported declines of more than 20 percent. 

While the manufacturers of system-relevant packaging for food, pharmaceutical and medical products are in some cases coming up against capacity limits, suppliers to the automotive industry in particular are confronted with a considerable slump in demand.

Industry prepared for a second Corona wave

A K-Profi survey of plastics processors shows that most companies are already prepared for the potential repercussions of a second Corona wave. Most respondents agree that a second lockdown or virus spread would have dramatic economic consequences. However, companies are taking precautionary measures in preparation for a potential second wave, paying increased attention to liquidity and dependence on upstream suppliers.

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