The German paper sack industry has made a good start to the current year despite adverse conditions, according to the German Paper Sack Industry Association on the occasion of the publication of its industry report. In a European comparison, it continues to occupy second place.
A tight supply situation, the effects of the Corona pandemic and the war in Ukraine pose major challenges also for the paper sack industry. This is according to a member survey of the Gemeinschaft Papiersackindustrie (Community of Paper Sacks Industry; GemPSI). Nevertheless, the forecast for 2022 is essentially good. The majority of members expect rising sales and stable development in the individual customer segments. For the coming fall, however, they see further pandemic-related shift cancellations ahead. “Our goal continues to be to act flexibly and develop pragmatic solutions in cooperation with all stakeholders to ensure a supply of paper bags that meets demand and deadlines,” says Alfred Rockenfeller, Chairman of GemPSI.
Growth despite crisis
With a 3.3 percent increase in the number of sacks delivered compared to the previous year, the German paper sack industry again ranked second in a European comparison in 2021, according to GemPSI. In its second-largest market segment, chemicals, it recorded growth of plus 11.8 percent, and in building materials (excluding cement) it was plus 2 percent. There was also moderate growth in paper bags for animal feed (up 3.3 percent) and food excluding milk powder (up 2.1 percent). There were some challenges to overcome in 2021: lack of paper supply, sharp price increases for raw and auxiliary materials, and a significant shortage of personnel due to illness and quarantine cases. According to GemPSI, the German paper sack industry countered the poor supply situation with close coordination with customers and suppliers and forward planning. In the first quarter, a 4.8 percent year-on-year increase in demand was met.
Paper sacks for food and animal feed in focus
The current industry report focuses on paper sacks for food and animal feed. Paper sacks for food, including milk powder, make up the third largest market segment of the German paper sack industry. In 2021, around 118 million paper sacks for food were delivered across Germany. In the first quarter of 2022, demand for paper sacks for food (excluding milk powder) remained at the previous year’s level (+0.4 percent), while it increased significantly for milk powder sacks (+30.2 percent). There was also year-on-year growth in 2021 for paper bags for animal feed. A total of 58 million paper sacks were delivered, meaning that the segment accounted for seven percent of the German market. Here, too, the positive trend continued in the first quarter of 2022: three percent more were shipped compared to the same period of the previous year.
In the industry barometer survey, members of GemPSI also indicated that the desire for sustainable packaging among customers had gained further momentum. In addition to brown sack paper and material reductions, recyclability of packaging has become increasingly important to paper sack customers, they said. However, GemPSI introduced the REPASACK take-back system 30 years ago to recycle kraft paper sacks, through which more than 20,000 tons of kraft paper sacks from industry and commerce are recycled annually.