Management Report Outlook Procurement 
PROCUREMENT
As a result of the fluctuation in energy and raw material prices, the ongoing optimization of our procurement management, including price, conditions, and product quality, is a key factor for securing further earnings growth.
In the current year, Fresenius Medical Care will primarily be implementing measures that have been developed in projects, for instance regarding supplier management. This will yield further cost savings in the areas of procurement and logistics. Material costs will again be a challenge in 2009. In future, we will therefore be searching more intensively for new suppliers. To which extend the generally unfavorable economic outlook will lead to a decline in the demand for raw and other materials, and thus in prices, too, has to be seen. The markets in the Asia-Pacific region will still place strains on supply capacities for selected material groups. We will therefore continue to pursue cost reductions in 2009 and ensure our production capacities. The potentials of the North American and Asian-Pacific markets will become increasingly important. The corresponding initiatives are already underway.
Fresenius Kabi expects procurement costs for electricity and natural gas to rise in 2009. The prices of other production materials such as cardboard boxes should remain stable. We will continue bundling our procurement processes on a global, cross-company basis. Individual processes will also be streamlined over the longer term through the introduction of electronic requisitioning procedures. It remains to be seen whether the trends in the second half of 2008 in the prices of energy and oil-based products will continue in 2009. We expect price reductions for processed corn products in Europe as a result of the good harvest in 2008, but a continued high price level in the United States. The prices of processed milk products will probably come down from their present level since the supply has increased. We will be successively integrating the procurement management processes at APP Pharmaceuticals from 2009 onward.
Fresenius Helios will start implementing a master article database in 2009. The project analysis was performed in 2008. As a first step, the HELIOS product group catalog will be completely revised, with an improved structure, hierarchy, and specification system that will make effective materials control easier. All materials negotiated will then be assigned to new groups, with designations, volumes, and supplier names harmonized across all regions. The structure of the groupwide updating and administration of the master data will be developed together with related IT. This will enable further cost savings and improve cost control in future. The integration of more clinics will support these goals, increasing purchasing power by ordering in larger quantities, and by requiring sourcing to be conducted through the HELIOS Kliniken procurement management system.
By using the enPortal online platform, HELIOS was able to hold the increase in the price of its electricity purchases for 2009 in the third quarter of 2008 below the market level. The electricity for 2010, purchased in the fourth quarter of 2008, is priced below the level for 2009.