The weak economic environment significantly affected the revenue development in the German wood industry last year. According to figures from the Federal Statistical Office, the industry's revenue decreased by 10.6 percent to 40.4 billion euros in 2023 compared to the previous year, as reported by the Main Association of the German Wood Industry (Hauptverband der Deutschen Holzindustrie, HDH). The data cover the development for companies with 50 or more employees.
HDH Managing Director Denny Ohnesorge. Photo: HDH / Angelika Aschenbach
The key factor behind the double-digit decline in revenue was the performance in key sectors. For instance, the sawmill industry experienced a revenue reduction of over 27 percent to 6.4 billion euros. Revenue from wood-based materials, including chipboard and OSB panels, fell by 15.6 percent to 5.3 billion euros. The wood packaging sector saw the most significant revenue decline in percentage terms in the wood industry in 2023, with a decrease of 27.5 percent to 863 million euros. The wood packaging industry, including pallets, export packaging, and cable and wire drums, is considered a leading indicator of economic trends due to its importance for German industry logistics. The significant revenue decline in this area is therefore of particular concern regarding overall economic development.
The losses in the furniture industry were within narrower margins, with an overall decrease of 4.3 percent to 18.0 billion euros. Contradictory developments were observed within individual segments. The most significant losses were recorded in "Other Furniture," including living room, dining room, and bedroom furniture, with a revenue decrease of 12.6 percent to 5.6 billion euros. Conversely, office furniture saw a slight increase of 2.6 percent to 2.3 billion euros, while revenue from store and other object furniture also rose slightly by 3.3 percent to 2.3 billion euros. The order intake in the furniture sector decreased significantly throughout the year due to consumer uncertainty and resulting weak consumption, according to the HDH's summary.
Revenue in the construction-related sector of the wood industry fell by 3.0 percent to 7.7 billion euros in 2023 compared to the previous year. 'The relatively high order backlog in the construction-related sector of the wood industry at the beginning of the year was gradually reduced over the course of the year, accompanied by fewer and fewer orders. Due to the significantly increased construction costs, increasingly worse financing conditions, and unclear subsidy conditions, demand for construction declined drastically,' summarises HDH Managing Director Denny Ohnesorge regarding the figures, which refer to companies with at least 50 employees.
According to Ohnesorge, the revenue development in the wood industry must serve as a wake-up call to policymakers who can create a more favourable environment through better framework conditions. 'We need fewer regulatory burdens and more incentives for investments in climate-friendly growth. On the incentive side, better funding conditions for climate-friendly renovation and construction are a must,' warns Ohnesorge.
The negative revenue development is accompanied by a noticeable decrease in the number of companies and employment in the sector. The number of companies with 50 or more employees decreased by 1.1 percent to 917 on average in 2023 compared to the previous year. The number of employees in the wood industry also fell significantly, by 2.4 percent to 151,794 people compared to 2022.
More information:
Hauptverband der Deutschen Holzindustrie
www.holzindustrie.de