Frankfurt, Germany -- After a difficult year in 2009, with a decrease in foam plastics and polyurethanes production in Europe, of up to 30 percent in some areas, the FSK, the German association of foamed plastics and polyurethanes, says it expects a significantly better result in 2010.
But at the same time the association warns that rising prices for raw materials and energy cause concern, and these factors, "clearly threaten the tentative economic upturn."
"We expect 2010 to see a sales volume of the industry of around Euro 8600 million ($11 151 million), and a level of around 1.7 million tonnes of processed plastics and polyurethane foam in Germany," predicted the association's managing director Dr Hans-W. Schloz at the FSK annual meeting in Stade, Germany, 8-9 Sept this year.
According to the FSK, Germany processed about 30 percent of the Western European market for foams made of polyethylene, polypropylene, polystyrene -- both expanded and crosslinked types (EPS and XPS) -- melamine resin foam, polyvinyl chloride foam, rubber foam, and polyurethane.
Not included in this data are hard thermoplastic foams such as those used in rigid foam panels.
Total revenue in the plastics foam sector for the year 2009 was about Euro 7000 million, with about 1.5 million tonnes of the materials mentioned - "well below previous year's levels," the FSK noted.
Polyurethane represent by weight one of the most widely processed foam materials, the FSK data indicates. Not only is polyurethane foam used in car seats or car parts and insulating materials, but it is also made into tough rigid foam parts for construction, and into paints, coatings and adhesives as well as semi-hard components.
In particular, the construction industry and some consumer areas were, after the difficult months in 2009, able to develop positively.
Currently, many sectors, including construction, the automotive sector and the many technical specialities in industrial applications are supporting the upward trend.
Rising commodity and energy prices are causing concern, the FSK warns. Higher costs for both energy and raw materials purchasing and production threaten any small signs of recovery, the FSK said.
As the association points out, in the "boom years" of 2007 and early 2008, strong sales at high prices -- but with low profit or even small losses -- were a decisive factor that forced many suppliers, especially in the automotive sector, to their knees and straight into bankruptcy immediately the economic downturn struck, cautioned Schloz.
Some member companies of the FSK and the foam industry have fallen victim to this trend, the FSK commented.
The difficulties caused by "commodity price speculation and the increasing cost of energy," are added to by current enormous tax burdens and put a lot of pressure on prices and on competitiveness, the FSK concluded.
PIC: FSK managing director Dr Hans-W. Schloz