Shortage of Materials Becoming More Acute in German Manufacturing
The shortage of materials in German manufacturing has again become even more severe in December, with 81.9 percent of companies complaining about bottlenecks and problems procuring intermediate products and raw materials. This is a new record. In November, the figure was 74.4 percent. This is a finding of an ifo Institute survey. “German manufacturing faces a paradox,” says Klaus Wohlrabe, Head of Surveys at ifo. “Order books are full, but the shortage of materials means companies can’t ramp up production accordingly.”
The number of companies with procurement problems has increased in almost all industries. Manufacturers of electrical equipment are particularly hard hit at 94 percent, followed by the automotive industry at 93 percent and manufacturers of machinery and equipment at 91 percent. The situation has become radically worse in the paper industry, where the share of affected companies rose from 66 percent to 89 percent. There was a slight easing in the leather industry, but just under one in two companies still reported procurement problems.
Given the difficult procurement situation, price increases remain on the agenda. “At least one in two companies is planning to put prices up in the next three months,” Wohlrabe adds.
