German manufacturing companies reported an ease in material shortages at the start of the year, but the decline may not be strong enough to cope with the expected winter recession, survey results from the Munich-based ifo Institute showed on Thursday.
In January, 48.4 percent of German manufacturing companies witnessed material shortages compared to 50.7 percent in December.
"Given the mild winter recession that's emerging, we would've liked to see a stronger decline," Klaus Wohlrabe, head of surveys at ifo, said.
Wohlrabe also pointed out that many companies are only slowly managing to work through their high order backlogs.
Among sub sectors, the situation for manufacturers of machinery and equipment and in the automotive industry remained virtually unchanged at the start of the year.
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In addition, sourcing raw materials and intermediate products continued to face bottlenecks for three of four companies in these industrial segments.
Material shortages faced in the chemical industry continued to ease in January, as the number of affected firms was just under one-fourth or 25.5 percent, the lowest level since the start of 2021.
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The paper industry is experiencing comparatively few effects, with just 13.8 percent reporting problems, while considering food and beverage manufacturers, the figure is just under one-third or 30.7 percent, ifo said.
In the case of the manufacture of basic metals, the figure has dropped to 7.4 percent, which is as low as it was before the shortage crisis began.