Germany confectionery exports were at the lowest level since 2005 last year as the market was hit hard by EU sugar shortages, according to the German confectionery Association (BDSI).
Confectionery and snack exports from Germany fell 4% in 2012 to 1.68m metric tons – the lowest rate in seven years, while exports sales remained flat at €5.8bn ($7.7bn).
Sugar supply harms exports
Torben Erbrath of BDSI told ConfectioneryNews.com: “There are two reasons: The one thing is the Euro crisis mainly in parts of Southern Europe.”
Around 85% of German confectionery exports are to other EU countries, while the remaining 15% goes mainly to US, Switzerland, Russia and Australia.
“The other is competiveness in other markets because of the sugar supply,” said Erbrath.
BDSI has been campaigning for the EU to remove sugar quotas in its upcoming Common Agricultural Policy (CAP) reforms. It has said that current rules threaten supply for German confectioners.
“The quota regime must end by 2020 – ideally by 2015,” said Erbrath.
Delayed orders forces closures
He said that special orders for sugar around key seasonal periods had reached confectioners too late, harming profits and even leading to some closures.
Sugar confectioner van Netten was recently forced to close resulting in 110 job losses, said Erbrath.
It did so soon after sugar prices increased 22% between September 2011 and September 2012, according to Statistischem Bundesamt (Federal Statistics Office).
Overall confectionery sales in Germany in 2012 dropped 0.3% to €12.47bn ($16.6bn).
The German cocoa grind, a signal of demand for chocolate in the market, was down 16.55% to 377,258.3 metric tons in 2012 – but Erbrath said that Fuchs & Hoffman had stopped reported, which had had some impact on prior year comparisons.
“We hope that the situation will improve this year. We think that the main market, Germany, will be stable and exports will improve,” said Erbrath.