Walsum No CO2, no sparkling water: Rheinfelsquellen needs about 6,000 tons of carbon dioxide per year. “We don’t do anything without carbon dioxide,” says entrepreneur Heino Hövelmann, who is the fourth generation to run the beverage manufacturer. The company uses the gas to make soft drinks like Sinalco and mineral water like Rheinfels Quelle. In the production process at the headquarters in Duisburg-Walsum, more than 200,000 bottles are filled per hour.
But since autumn there has been a global shortage of CO2. Up until now, the carbon dioxide required has been a waste product from the production of ammonia, i.e. artificial fertiliser. Because of the high natural gas prices, fertilizer plants have severely shut down operations. Only 30 to 40 percent of the required amount of carbon dioxide is available, recently warned the beverage industry association. Wells, breweries and juice producers have had to reduce their production in some cases.
The industry is already considering which sparkling drink is most likely to be discontinued in case of doubt. “Fortunately, we didn’t have to shut down our operations or even shut them down like some others,” says Hövelmann. He is the managing partner of Rheinfelsquellen H. Hövelmann GmbH & Co. KG and manages the company with his cousin Heidrun and managing director Edmund Skopyrla.
Rheinfelsquellen came through the carbon dioxide crisis unscathed
“In order to continue being supplied with CO2, we had to accept 50 percent higher prices,” explains Hövelmann. The family business with 650 employees came through the carbon dioxide crisis unscathed because it switched to a broad network of suppliers three years ago. At that time, there was a bottleneck when chemical plants went into maintenance at the same time. “That was a lesson for us.”
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The entire food industry is urgently dependent on alternative CO2 sources, emphasizes Hövelmann and sees politics as a duty. After all, the government rightly wants to reduce the use of artificial fertilizers, which will permanently reduce the supply of the by-product carbon dioxide.
>> Read here: The first brewers stop production due to a lack of CO2
The natural gas and economic crisis is currently making business at Rheinfelsquellen difficult. The company is number three among branded mineral fountains in Germany, behind Gerolsteiner and Danone (Volvic). “Increasing energy costs are a burden for us, but we were able to pass on some of the additional costs through higher prices,” says Managing Director Skopyrla.
Sales, which declined during the pandemic, are expected to increase again this year by five percent from EUR 179 million. Sales should therefore grow in almost double digits in 2022, but will still remain just below the pre-Corona level.
Germans drink less mineral water
Before the pandemic, Germans drank an average of around 140 liters of mineral and medicinal water per capita per year, in 2021 it was just under 123 liters. This year the market has recovered somewhat, mainly because the catering trade was allowed to open. Every fourth bottle of water is drunk there.
Thanks to their brand mix, the Duisburg-based company can assert itself relatively well in the difficult market. “With our brands Sinalco, Staatl. Fachingen and Rheinfels Quelle, we see decent growth after the pandemic, as well as water for discounters in six-way packs,” says Hövelmann. Mid-price brands from Duisburg, such as Mercator or Felsensteiner, are suffering.
The entrepreneur is the fourth generation to run the beverage manufacturer. Rheinfelsquellen not only produce mineral water, but also lemonades like Sinalco.
(Photo: Rheinfels source)
Because thrifty consumers don’t just switch to cheap brands: “In times of inflation, many people replace mineral water in the entry-level price segment with tap water,” explains Karl Tack, President of the Association of German Mineral Springs (VDM).
With the exception of the hot summer of 2018, the market for mineral water has been declining for years and is consolidating. Several private label manufacturers were bought out. The main reason for the decline is the bad image of single-use plastic bottles, which according to the VDM still accounted for more than 64 percent in 2021.
The industry is suffering from “plastic bashing,” complains Tack. The narrative that German water bottles would litter the world’s oceans is simply wrong. “PET bottles are almost 100 percent recycled in a closed cycle.”
Water use rights are just not being extended for decades
One of the water brands that disappeared from the German market: Vittel by Nestlé. The Swiss group has also been criticized for a long time because of disposable plastic bottles. Environmentalists denounced the long transport routes from France and falling groundwater levels in the headwaters. In addition, Vittel apparently only made small margins in this country. “A company like Nestlé has double-digit return expectations. Medium-sized wells like us are more frugal,” explains Hövelmann.
The family business was founded in 1905 by Karl-Albert Hövelmann as a beer wholesaler. He also bottled lemonades and table water. The Rheinperle soft drink brand made a breakthrough after the war. In 1972 the first own mineral spring was tapped. “Our mineral water deposits at a depth of almost 300 meters below the Rheinauen is demonstrably more than 25,000 years old, which is unique in Germany,” emphasizes Heidrun Hövelmann. The family has also been producing and marketing Sinalco for Germany, Austria and Luxembourg since 1994.
“The extreme dry seasons are a challenge for our industry,” says the managing partner of Rheinfelsquellen.
(Photo: Rheinfels source)
A year ago, the water rights of the Rheinfelsquellen were extended by 30 years. The first wells are now receiving shorter usage rights from their water authority. Because water has become a scarce commodity in many places. “If there is a risk that funding rights will be restricted or even withdrawn during periods of drought, companies can no longer invest,” the association warns.
“The extreme dry seasons are a challenge for our industry,” confirms Heidrun Hövelmann. However, the managing director also confirms that the company is aware of its responsibility: “We are allowed to withdraw one billion liters a year, but we only use two thirds of it – if only to ensure the constant mineralization of the mineral water.”
Reusable rate of more than 80 percent
From an environmental point of view, the approximately 220 private mineral springs in Germany benefit from the fact that they mostly sell regionally. Reusable bottles make sense there. The reusable rate for the Rheinfelsquellen is more than 80 percent. “There is no need to transport mineral water across the Alps or even from the Fiji Islands,” says industry expert Tack.
Mineralbrunnen want to be the first German food sector to be climate-neutral by 2030. The Rheinfelsquellen have been climate-neutral since 2021, remaining emissions are offset by certificates.
“The gas crisis increases the pressure to use our energy even more efficiently,” says Heino Hövelmann. In Walsum, a combined heat and power plant generates 40 percent of the electricity in addition to the heat for rinsing the bottles.
So far there have been separate cooling and heating circuits, which are now to be coupled. In the past, heat pumps could only generate temperatures of up to 60 degrees, today 90 degrees are also possible. This temperature is necessary for cleaning the bottles.
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