In 2021, European foundries have recovered partly from the dramatic reductions caused by the pandemic. Disruptions in the international supply chains and rapidly rising material and energy costs in the second half of the year prohibited a more positive development.
The publication “The European Foundry Industry 2021” is now available on the CAEF website.
Looking ahead to the year 2023, there are stronger signs of a recession in several European economies. It remains unclear how strongly demand for cast components will decline. While order books are still at a good level in many markets, incoming orders are already declining noticeably at the onset of winter.
The European Foundry Industry Sentiment Indicator (FISI) decreased by 2.6 points in September and reaches a value of 104.0 points. This marks the lowest index value in the last 21 months, while it is the sharpest month to month decline since March 2020. Both the expectations for the next six months and the assessment of the current business situation dropped significantly. The exceptionally strong drop is also characterised by the fact that the ratings point in the same direction across all metals.
To exchange ideas during one of the most challenging economic crises since decades more than 80 representatives of European foundries and foundry associations met in Paris on 22 and 23 September at the CAEF Summit 2022. The two-day programme included presentations by experts on various facets of the crisis, but also on perspectives.
The FISI is still stable in the holiday month of August. However, with the onset of the heating season and a steady slowdown in the economy, the coming period is expected to be extremely rough. Thus, more and more businesses are now being really hit by energy costs as old contracts expire and the number of those who have to produce under the new conditions is now steadily increasing.
There has never been a greater difference between the assessment of the situation and the expectations since the beginning of the data collection. While the current situation is still considered positive by many foundries due to the good order situation in the mechanical engineering sector, the expectations for the next six months are on the downturn. Tensions are rising, especially as signs of a slowdown in demand are intensifying.
Like many other industries, the foundry industry is considered a male-dominated sector. Nevertheless, countless women are working in our foundries from production and administration to research in all areas and are doing indispensable work every day. What is daily routine and normality for individual colleagues is inspiring many others — especially young talents! Role models and stories are needed to dispel prejudices and promote the diversity of our industry, not only in terms of products, but also in terms of the people who take it to a new level. CAEF therefore calls on you to participate in the new EUROPEAN FOUNDRY WOMEN’S AWARD.
After the significant drop due to Russia’s invasion of Ukraine, the business climate of the European foundries is stabilising for the time being, despite all the uncertainties. While the assessment of the current business situation is slightly declining, the expectations for the coming six months are improving moderately. The historic drop of the FISI in recent weeks was, however, due to the latter. The fact that companies’ expectations are riding a rollercoaster given the great uncertainties is one of the few things that is momentarily certain.
The European Foundry Industry Sentiment Indicator (FISI) increased by 0.6 points in May and reaches a value of 106.1 points. After the highest loss since the outbreak of corona pandemic in Europe in March 2020 the FISI has slightly recovered.
After the decline in the previous months was caused by a war-related drop in business expectations for the upcoming six months, European foundries are now increasingly experiencing some positive effects on their business situation.
While the sanctions against Russia were steadily tightened in March and April, the problems in the supply chains and the adjustments in the prices for input materials are becoming more and more apparent for European foundries. In addition to the war, global disruptions in the logistics industry have also increased due to the harsh Corona lockdown in China. The FISI drops 2.7 points in April, the largest decline since the Covid-19 outbreak in Europe in March 2020.