BDSI confectionery body raises concerns, as German sector exports continue decline
Exports of German confectionery have come under renewed pressure, with the BDSI calling for clearer German and EU support.
Germany’s BDSI confectionery organisation has warned that challenging national economic conditions have seen confectionery exports slide 0.6% in the first quarter of 2024, following a 1% decline last year, reports Neill Barston.
Traditionally, the country’s sweets and snacks trade has enjoyed robust fortunes, yet a combination of high energy and raw ingredients, and supply chain challenges worsened by the ongoing wars in Ukraine and Gaza, have impacted manufacturers within the sector along with many other industries.
As the BDSI noted, Germany’s highly concentrated food retail market has been of core importance, with the export of confectionery considered of central importance for producers across the country.
Notably, with a value share of well over 60%, overseas sales make a significant contribution to value creation and to maintaining the unique medium-sized structure of companies, with German confectionery and snacks enjoying strong popularity in many European countries, and further afield.
Moreover, in a survey from the BDSI, raw materials, personnel, energy and bureaucracy were named as the strongest cost drivers in 2024, with the implementation of reporting obligations in the area of sustainability and supply chain legislation reportedly seen as representing the greatest administrative challenges for companies.
As reported by Confectionery Production, the upcoming EUDR regulations in particular, which have gained international headlines, and seen calls for their delay by the US government, as well as a number of European nations, cocoa organisations in Ivory Coast, and authorities in Malaysia and Indonesia.
Conversely, the legislation, which has gained European parliamentary approval, is due to be introduced at the end of this year, has also received strong backing within the confectionery and snacks sector, with a generally supportive mood towards its core aims of holding mid to large size companies responsible for proving no deforestation within their supply chains.
The frameworks are also designed to help ensure human rights are secured for those working with key supply chains, which has been welcomed by the sector, though cocoa communities in Ghana and Ivory Coast have continued to express concerns over whether they will be left footing the bill for the increased amount of farm-level monitoring.
There have also been concerns raised regarding the accuracy of the proposed satellite mapping system and capacity and operation of the IT infrastructure set to underpin the new legislation, which was raised at the recent World Cocoa Conference as a significant issue.
However, speaking at that event, a representative of the EU Commission said that it remained committed to implementing the scheme from the end of this year.
As for the situation in Germany, the BDSI called on its own and wider European governments to agree a clear strategy and policy in relation to compliance rules, as well as establishing declaration requirements in a number of target markets.
The trade organisation also highlighted other key areas for urgent consideration including examining unfavourable currency exchange rate, non-tariff barriers to trade, and addressing a lack of trade agreements.
“We urgently need a change of political course, both in Brussels and in Berlin. In addition to the costs, the economy is suffocating because of ever new bureaucratic requirements. Medium-sized companies are increasingly doubting whether they can cope with this flood of regulations and whether Germany as a production location remains economically viable,” warns Dr. Carsten Bernoth, General Manager of the BDSI. “It is now important to give new impetus to international trade policy and strengthen the EU internal market. We urgently call on the new EU Commission and national politicians to do this.”
