COVID-19 News / Europur: Update on flexible PU foam production in Europe

On 28 April, Europur published an update on its previous status report of 7 April 2020 on the impact of the Corona crisis on European production of flexible PU foam: Governments that previously imposed restrictions on retail have already started or are planning to gradually lift restrictions between now and the second half of May. PU foam plants making plans to reopen. The production, however, will still take place at much reduced capacity due to ongoing low demand.

Foam plants serving the automotive industry are also opening or plan to so shortly. Most car manufacturer planned to restart production on 4 May. Therefore all foam plants serving the automotive industry will be running again as of early May, although at much reduced capacity.

The production on foam plants serving the mattress and furniture industry is expected to be still reduced in May. An improvement depends on the reopening of the retail trade. Europur confirmed that production in April fell by 60 to 70 % year-on-year. For May, the association expects the situation to improve only slightly, as production in Europe will have fallen 50 to 60 % compared to last year, although there are significant geographical variations. For 2020, the expected decline in mattress and furniture production may be between 15 and 25%. However, this is highly dependent on the geographical location and customer structure of the company.

Austria, Germany and Switzerland: PU foam plants are open but operate at much reduced capacity. In the region, mattress and furniture retail was largely closed in April but has started to reopen. As retail reopens progressively, the expectation is therefore that production will increase in May, above the calculated European average.

Benelux: PU foam plants are open but operate at much reduced capacity as had been the case throughout April. The level of production for April was generally higher than the European average calculated by Europur. This is due to the fact that retail in the Netherlands never closed. Most plants expect an improvement for May, depending on retail reopening in Belgium, Germany and France.

France: At least one foam plant restarted operations, with the others planning to follow, all at low capacity.

Greece, Balkans and Cyprus: Most plant operating at much reduced capacity. There is no formal government order imposing the closure of industries. However due to lack of demand, all companies are currently operating at reduced capacity. In Greece, most foam plants serving the comfort sector were closed but are in the course of reopening. In the Balkans, production is down throughout the region but less than the European average, supported by relatively good performance of online sales and resisting exports. Retail is closed in most countries and local demand is therefore very low, probably well into May with governments considering easing restrictions only in the second half of the month. Some companies are expecting May to be more or less similar to April overall.

Hungary, Czech Republic, Croatia, Slovakia, and Slovenia: PU foam plants are open but operate at much reduced capacity. The region has been generally performing well above the calculated European average for April. The situation should further improve in May, particularly if automotive plants and retail reopen as planned.

Iberia: In Spain, most foam plants were closed throughout April as the country was under the strictest lockdown in Europe. Only foam plants producing foams for sponges and medical equipment could remain open, and three of them have done so at strongly reduced capacity. Non-essential businesses (including mattress and furniture producers) can operate again since late April. However, demand for (non-medical) mattresses and furniture is very low and will rely on the reopening of the retail trade. This is why some foam plants have decided to remain closed for the time being. Foam production in Spain for the months of April and May will therefore be well below the European average calculated by Europur. In Portugal, all but one foam plants were closed in the first half of April due to lack of demand for foam from Spain and France. Since last week, other foam producers have also resumed activities at reduced capacity. Generally, the level of production in Portugal in May will be very much dependent on how the situation in Spain and France evolves and at low level.

Italy: The polyurethane foam industry could continue to operate, as it was classified as essential business. However, the (non-medical) mattress and furniture industries were not classified as essential and demand for foam was down. Therefore some plants voluntarily stopped foaming progressively due to lack of demand and disruption of supply chains (shops are still closed), some others operates at much reduced capacity.

Poland: The situation in Poland varies from company to company depending on their customer structure. Most plants are currently open and producing at reduced capacity while others are closed until well into May. The Polish foam industry is particularly affected by the closure of retail in Europe’s largest markets. April has generally been a very difficult month with some players reporting very strong decreases in production, much higher than Europur’s reported European average while others were more or less in line with this average. The expectation is that May will be slightly better than April, especially if retail reopens in most of Europe.

Romania and Bulgaria: Most foam plants have been operating in Romania and Bulgaria through April at much reduced capacity. Some plants however closed temporarily around the Easter holidays and some are still closed due to lack of demand.

Turkey: In Turkey some foam plants are still closed due to lack of demand while others are operating at reduced capacity. Generally, being relatively less impacted by the epidemic and with no permanent strict lockdown, the country has been performing a little better than Europur’s calculated European average for April. May is expected to be similar to April in terms of production.

Scandinavia and the Baltics: Foam plants have remained open throughout Scandinavia and the Baltics in April, but at much reduced capacity. Generally, the reduction in production in April has been less drastic in the area than in other parts of Europe. In the region, Sweden is an outlier, having adopted much less restrictive measures than other countries and has therefore performed better than other countries. The Baltics-being the most export dependent in the region-have been proportionally more affected by the closure of most retail in Germany. Companies across the region expect some improvement in May, especially if retail re-opens in others part of Europe.

UK and Ireland: Most foam plants are currently open at much reduced capacity. In Ireland, the country’s foam industry is continuing reduced operations. An end of the lockdown is not foreseen until early May.

Ukraine, Russia, Belarus, Kazakhstan: Except for a few plants in Russia, most PU foam plants across the region are now producing, but at much reduced capacity. The situation of individual foam plants can change rapidly with the evolution of the epidemic in Russia, where it has not reached its peak, yet.