Germany’s food producers are warning that rising energy prices may soon force them to shut their doors.
The German Frozen Food Institute and the Association of German Cold Storage and Logistics Companies recently released an open letter to the public, in which they stated, “There are significant supply gaps in the daily food supply for people in Germany. The situation is more than serious.”
It went on, “Companies now fear that production lines will soon come to a standstill and that refrigerated logistics centers for food distribution will be closed. Some are even preparing for possible insolvency.”
The letter was signed by five other industry groups, and was addressed to Chancellor Olaf Scholz, Federal Minister of Economics Robert Habeck and Federal Minister for Food Cem Ozdemir.
The authors of the letter noted that the financial standing of the authors was deteriorating every day, and a wave of bankruptcies sweeping throughout the industry was coming if nothing was done. They warn that without governmental intervention, especially financial support for medium-sized producers in the energy-intensive deep-freeze chain, these producers could be forced to shut their doors, and food shortages could result.
The letter went on, “The food industry is currently experiencing the worst crisis since the end of the Second World War… It’s a minute to twelve. Act now – otherwise the refrigerators and freezers of the German population will soon be empty.”
Germany, along with the wider EU, is in the midst of an energy crisis due to the cessation of natural gas supplies from Russia, and surging inflation resulting from the rise in energy prices that is producing. Experts are predicting this winter may see energy rationing and shortages, as countries desperately try to make up for the shortages in gas supplies, and seek alternative sources of fuel. The frozen food industry is particularly vulnerable due to its need for constant, sizable supplies of electricity to power its freezers, and experts say, unless something is done, it may not prove economically feasible to keep the population supplied with sufficient quantities of food.
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Stuart Turley is President and CEO of Sandstone Group, a top energy data, and finance consultancy working with companies all throughout the energy value chain. Sandstone helps both small and large-cap energy companies to develop customized applications and manage data workflows/integration throughout the entire business. With experience in implementing enterprise networks, supercomputers, and cellular tower solutions, Sandstone has become a trusted source and advisor in this space. Stuart has led the “Total Corporate Digital Integration” platform at Sandstone and works with Sandstone clients to help integrate all aspects of modern digital business. He is also the Executive Publisher of www.energynewsbeat.com, the best source for 24/7 energy news coverage and is the Co-Host of the energy news video and Podcast Energy News Beat.
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