Destocking along supply chain / recycling at record level / Slight upward trend expected in 2010

Despite a slight decline in volumes in 2009, the producers of aluminium packaging managed to cope relatively well with the economic crisis. Overall, the production of packaging made from or using aluminium recorded a slight fall in 2009. With 356,600 tonnes (t) of aluminium foil, tubes, flexible packaging and aerosol and beverage cans, the aluminium packaging manufacturers produced some nine per cent less than in the previous year (2008: 393,000 t). This figure, which is slightly above the five per cent decline in gross domestic product, can be attributed mainly to destocking along the whole of the supply chain. This occurred because the financial crisis brought the reduction of working capital into focus. Turnover in the sector declined in 2009 to EUR2.1bn (2008: EUR2.4bn), which was due in part to lower world prices for aluminium. “After a good year in 2008, the producers of aluminium packaging still managed to do reasonably well last year despite the global economic crisis,” explains Stefan Glimm, managing director of Gesamtverband der Aluminiumindustrie e.V. (GDA) in Düsseldorf.
“In 2010 our sector is expecting a slight upward trend similar to that of the general economic forecasts,” he adds.

According to Stefan Glimm, last year’s decline in production manifested itself markedly differently in the various end markets. For example, there were more significant declines in packaging for higher-priced cosmetics, items where a purchase is more easily deferred. On the other hand, developments in the markets for pharma packaging, dairy products and beverages were steady or slightly positive.
“The clients of the aluminium packaging producers reduced their stocks rigorously last year and have resorted to ordering at ever shorter notice. At the same time, the demand is often only for smaller batch sizes,” confirms Dr Monika Kopra-Schäfer, chair of GDA’s Tubes, Cans and Impact Extrusions specialist trade association. “This requires a very high degree of flexibility on the part of member companies, leads to higher retooling costs and thus squeezes margins even more. This means that new services are expected from the packaging manufacturers, and these come at a price, of course.”

Also noticeable is the trend towards private brands and own-labels where the packaging is becoming increasingly more important but is thus also increasing the need for ever more economical solutions. The companies in the sector are tackling these and other challenges with new and ever more intelligent packaging solutions. “Aluminium packaging will continue to be fashionable in future, too. The innovativeness of the manufacturers coupled with Media information aluminium’s excellent properties are helping us achieve new market successes time and time again,” adds Dr Kopra-Schäfer.

The manufacturers of aluminium packaging are quietly optimistic for 2010.“The first quarter has started well and we expect things to continually improve during the course of the year,” says Thomas Hauser, chair of GDA’s Aluminium Foil specialist trade association. The sector had plenty to do at the beginning of the year and there was an upturn in orders received. However, in view of the short-term planning by clients, it is barely possible to make a reliable prediction for the rest of the year. “Uncertainties predominate.However, if the overall economic situation stabilises and, above all, if there is no perceptible increase in unemployment figures, we too will again grow slightly,” is how Thomas Hauser voices his expectations.

The aluminium beverage can is enjoying success in its 75th-anniversary year. The can, which has been the subject of much discussion in Germany in recent years, has undergone rapid development abroad and its comeback in the domestic market has been accompanied by continual growth. Sophisticated and creative designs and growing environmental awareness have led to markedly improved acceptance of the beverage can by consumers. “The beverage can market is showing double-digit growth and the aluminium can’s growth is disproportionately high. This had led to a shift in market share between the metals: at one time we only had a modest share of the market in Germany of some 12-15 per cent; now more than two-thirds of the beverage cans used here are made from aluminium,” explains Stefan Glimm.

Germany plays a leading role in Europe when it comes to the recycling of beverage cans, as it does too with all other types of aluminium packaging – although Europe is also on the right track with an overall recycling rate of over 50 per cent for all aluminium packaging. “Aluminium is a recyclable material par excellence. It has excellent material properties and is used within a largely closed material loop comprising metal extraction, processing, use and recycling, not least because of its intrinsic metal value and the fact that it can be recycled and made into new products time and time again without any loss in quality,” explains Stefan Glimm.

According to the latest figures from the Gesellschaft für Verpackungsmarktforschung (GVM), the recycling rate for aluminium packaging in Germany in 2008 was 81.3 per cent. Moreover, within the deposit scheme 96 per cent of aluminium beverage cans were returned. “These figures show that there has been a further increase in the recycling of aluminium packaging at what was already a high level. They are the very best in Europe,” says Hans-Jürgen Schmidt, managing director of Deutsche Aluminium Verpackung Recycling GmbH (DAVR). “The intensive utilisation of the respective collection schemes by the consumer makes sense: after all, the recycling of aluminium packaging contributes to the conservation of resources. In Germany, this already leads to an annual saving of 300,000 tonnes of CO2 equivalents.”