February 2024 | Despite a weak start to 2024, the VDMA expects an improvement in the second half of the year, with a forecast of stagnation for the year as a whole.
According to a VDMA press release, the German industrial valves sector closed 2023 with nominal sales growth of 3 per cent, despite a real decline of 6 per cent compared to the previous year. Domestic business improved by 4 per cent, while foreign sales only rose by 1 per cent.
“The sales growth in 2023 – similar to the previous year – is mainly due to inflation,” says Dr Laura Dorfer, Managing Director of the VDMA Valves Association, explaining the current situation.
Dr. Laura Dorfer, Managing Director of the VDMA Valves Association
The industry, which stands for innovation and export orientation among other things, is facing challenges such as bureaucracy and a shortage of skilled labour.
Excessive regulation is a burden on companies
“While order books were still full at the beginning of 2023, the number of orders fell towards the end of the year. Our members are also suffering from an excess of regulation and bureaucratic obstacles. The lack of qualified specialists is also becoming increasingly noticeable,” continues Dorfer.
Despite these challenges, the coming months also offer opportunities. There are many indications that inflation will continue to weaken over the course of the current year, which should lead to an improved mood in the industry and give the general economy a boost again.
“Basically, the valve industry is well positioned and offers the right solutions for future topics such as the energy transition, hydrogen, clean water and the circular economy. In the coming months, companies in the industry will use the leading international trade fairs IFAT, ACHEMA and Valve World Expo in Germany, among others, to draw attention to their promising product portfolio. Against this backdrop, we expect a weak first half of the year in terms of sales, but are counting on an improvement in the second half of 2024. We are currently forecasting stagnation for 2024 as a whole,” predicts the trade association’s Managing Director.
Safety and monitoring valves lead the way
Safety and monitoring valves again performed best in 2023, with nominal sales growth of 6%. Shut-off valves recorded a 4% increase in sales. Control valves, on the other hand, which had posted good results in previous years, recorded a slight decline of 1%.
While domestic business was better than international business for shut-off and control valves, safety and monitoring valves performed better abroad. The outlook for shut-off and safety and monitoring valves is better than for control valves. According to VDMA figures, incoming orders are 4% down on the previous year in real terms.
Top export market China loses importance
In nominal terms, exports by German valve manufacturers increased again in 2023. In total, industrial valves worth around 5.1 billion euros were exported abroad. This corresponds to a nominal increase of 5.2% compared to 2022. However, adjusted for price, this equates to stagnation at the previous year’s level.
Exports to China, the most important customer country, have fallen again. Following a decline of 6.8% in 2022, they fell by a further 1.5% to 567.9 million euros in 2023.
The export business with the second most important trading partner, the USA, continued the success of the previous year and climbed again by a strong 11.6%. Exports thus amounted to 537.3 million euros. At the same time, exports to France increased by 7.1 percent. The country remained the third most important sales market with a sales volume of 313.0 million euros.
With an impressive increase of 25.5 percent to 180.4 million euros, the Czech Republic took 10th place among the most important customers.
