Tin platers struggle as metal prices hit record highs

Factiva: "U.S. tinplate makers say they are caught in a bind as high tin prices make production more costly while long-term supply contracts prevent them from passing increases on to consumers.

Although tin has soared to record highs on the London Metal Exchange, long-term contracts with customers for specific products make it impossible for tinplate producers to substitute cheaper material, sources said."

Chromium can be used for only a limited number of tinplate products, the trader source said, making one of the only other options the reduction of coating thickness. "There is no more than 5? pounds of tin on a ton of steel of average thickness," the source said.

If tin prices remain high and push up the pricing of tinplate, food packing companies might begin to substitute away from the product for glass or plastic, sources warned. However, such a shift would take time to implement, thus nullifying any immediate impact.

"It's always been a concern, but it's not so much a concern in the short term," the trader said.

While tin platers struggle with price increases, the rest of the tin industry is scrambling for material. One alloyer reported an outage at the end of June due to non-delivery of material and was recently told by a supplier to go elsewhere for tin. "It's been going on for six months. If I want to buy more than my quota, there's a distinct chance that I won't be able to," he said.

Tin platers struggle as metal prices hit record highs

Factiva: "The producer confirmed that tinplate manufacturers are safeguarding themselves against volatile tin prices for 2011. 'When you get into pricing for next year, it will be built in. It's too significant to absorb all the time,' he said, noting that while talks with consumers have started for next year, no deals have been finalized.

Building tin prices into contracts for tinplate might be a new approach for some producers, but smaller producers say flexible pricing is nothing new. 'Consumers pretty much understand. We tell them in our quotations that prices could change,' a small northeastern tinplate producer said.

It's not only long-term contracts standing in the way of substitution away from high-priced tin for tinplate makers. There also is a lack of easily substitutable material, sources said."

Chromium can be used for only a limited number of tinplate products, the trader source said, making one of the only other options the reduction of coating thickness. "There is no more than 5? pounds of tin on a ton of steel of average thickness," the source said.

If tin prices remain high and push up the pricing of tinplate, food packing companies might begin to substitute away from the product for glass or plastic, sources warned. However, such a shift would take time to implement, thus nullifying any immediate impact.

"It's always been a concern, but it's not so much a concern in the short term," the trader said.

While tin platers struggle with price increases, the rest of the tin industry is scrambling for material. One alloyer reported an outage at the end of June due to non-delivery of material and was recently told by a supplier to go elsewhere for tin. "It's been going on for six months. If I want to buy more than my quota, there's a distinct chance that I won't be able to," he said.

A U.S.-based trader said he recently tried to buy some material but was told "to contact somebody else. Some of the producers are holding back; they want more money."

Cadbury drops trial to replace 70-year-old Roses tin with board

packagingnews.co.uk: "Cadbury is reported to have dropped trials of a cartonboard replacement for the much-loved Roses chocolate tin.
The confectionery giant began trials last November of a square cardboard pack that would replace the round 975g tin.

However, according to reports in retail trade title The Grocer, the trial has now been dropped after shoppers rejected the new-style packs."

Analysis: Sector reels as board prices hit crisis point

packagingnews.co.uk: "Costs for board have rapidly risen over the last year as mills have pushed through three rounds of increases. Including the current third round of increases, carton printers contacted by Packaging News estimated the rise in board costs since September 2009 at between 20% and 35%, depending on grades.

On top of the high prices, lead times for ordering board have moved from three to six weeks to three months or more – sources suggest that in extreme cases, some grades are being sold now for delivery in March or April next year. Moreover, mills are reported to be imposing quotas on both individual companies and geographic regions. As a result, carton manufacturers are having to push for price increases at the same time as telling customers to plan their ordering months ahead of normal schedules."

Converters face squeeze as buyers resist price hikes

packagingnews.co.uk: "Packaging converters are facing a renewed financial squeeze after buyers said they would fight a new round of board and paper price rises.

Suppliers including M-real, Smurfit Kappa, UPM and Mayr-Melnhof said last month they were planning to push prices up again as a result of tight supply and their own input costs, which have shot up in the past year (see box).

But buyers are privately sceptical over whether the rises are justified and have said they will resist taking on extra costs themselves.
Paper and board converters, meanwhile, are struggling to pass on input costs and facing extremely long lead times for board purchasing that have been extended from a previous average of four to six weeks to up to 20 weeks in some cases."

The battle for the metal can's future

packagingnews.co.uk: "So is the can on the way out? Not a chance. Will volumes keep growing? Perhaps, but it's less certain. What is sure is that competition is out there. As they celebrate the Year of the Can, canmakers will need to make their case more strongly than ever to the brand owners and retailers of this world that, be it on price, branding opportunities, shapes, closeability or the perpetual environmental debate, their format is worth sticking with."

Steel can marches on in 200th year

packagingnews.co.uk: "Two hundred years on, the fundamentals of canning have changed little. But, as the metal packaging industry marks the bicentenary with its Year of the Can celebrations, the sector is fighting its own battles. Aseptic cartons and plastic containers are making small but significant inroads into markets that were once the exclusive preserve of the can. Sainsbury’s, for instance, has switched several of its chopped tomato lines to cartons, while some cooked meats have switched to recloseable plastic containers (see box)."

Yet the can industry is proving that heritage is no inhibitor of development. Uniquely profiled shapes, two-piece can formats for the food sector, ring-pulls, CFC-free aerosols, widgets, easy-to-open peel/seam closures and polymer coatings – providing greater scope for on-pack imaging as well as excellent anti-counterfeiting properties – are just some of the applications now taken for granted. Well on the way towards increased adoption are the resealable steel can (already commercialised in aluminium), and the microwave-ready tray capable of delivering a better quality convenience meal.

Resource efficient

Keeping pace with new technology has been the optimisation of steel’s long-established environmental credentials. Contemporary steel packaging uses less resources than ever before, and is infinitely recyclable without any detriment to its natural protective and preservative properties. With 70% of all steel packaging recovered for subsequent use, it sets the benchmark for energy conservation and reduced carbon footprint. Every tonne of recycled steel saves a tonne of virgin material.

All of these positive attributes are rigorously promoted by any number of trade bodies, not least Apeal, whose membership produces 95% of all steel packaging across Europe, and the European Metal Packaging Association (Empac), which has recently announced a €10,000 design competition to mark the format’s 200th anniversary.

"We would like to focus on cost-effectiveness and efficiency throughout the supply chain," says Empac chief executive Gordon Shade. "Students may, for example, invent a special closing mechanism or a fresh style for the can. It could even be a new use for the can with food, paint or aerosols. The emphasis will be on celebrating our two centuries of existence and improving on what we have achieved."

One fundamental challenge, however, might be difficult to overcome. The reality of the standard food can is that its shape is largely pre-determined, says industry consultant Bev Page. "It’s far quicker and costs less to produce a cylindrical can rather than opting for a differentiated shape. Not only does the circular can with a straight wall represent the optimum fitness for purpose but, as metal packaging is bought by surface area and equates to more than 50% of overall cost, a critical constraint is that the walling of a square can is greater than the circumference of the circle by as much as 15%."

It could be, however, that uniformity of shape isn’t a deterrent to sales after all. According to TNS, the value of steel packaging’s turnover in the UK canned food market was up by a recession-defying 9% during the first quarter of this year.

"The key sector of ready-meals including baked beans, soups and so on has been doing very well; likewise canned

vegetables, being led in part by the focus on pulses, are becoming more and more of a staple for healthier eating,"

says Steve Thomas, marketing manager at Crown Food Europe and chairman of the Canned Food UK industry association.

"The metal can, both aluminium and steel, is the stand-out solution in this impending age of austerity," says Thomas. "People are realising what good value for money a can of food is. They’re eating out less, cooking more and they’re looking for ingredients that will give them nutritional meals."

Even in the pet-food category, which has been targeted by the stand-up pouch, steel is showing a small growth with Crown reporting a good response to its new 85gsm single-serve can.

More rather than ‘either or’ is a view endorsed by Impress’s R&D director Philippe Giminez: "Cartons such as Tetra Pak’s Recart, adopted by Sainsbury’s for its own-label tomatoes, don’t seem to us to represent a big move towards plastic. We see metal packaging as a stable market with some definite growth sectors."

New openings

Ease of opening is an area in which steel packaging manufacturers have made significant advances in recent years. Having taken the initial lead with its ring-pull in the 1990s, Crown now supplies Easylift easy-open ends in four diameters including 65mm, 73mm, 83mm and 99mm – already available on Nestlé’s Purina cat food – and PeelSeam peelable ends: a peelable lid double seamed on metal containers and consisting of a thin flexible aluminium foil lid heat-sealed to a rigid steel ring. The PeelSeam lid family has just been extended to a 150mm diameter, particularly suitable for low-height cans and bowls.

Impress is focusing on similar solutions including what is claimed to be the world’s first commercial Easy Open End made from 0.18mm-thickness tinplate, a 10% material saving. While its Easy Peel double-seaming technology is constrained by the need to balance interior and exterior pressures below 0.2bar, the Easip solution is compatible with continuous retort.

According to Ball Packaging innovations director Robert Jansen, the reclosable top recently commercialised for Coke’s energy drink Burn could be equally well applied to steel constructions. The company is also challenging current can weights as part of its continuous efforts to reduce materials use and to minimise environmental impact. "Right now, a 330ml aluminium can weighs about 10gsm. The steel equivalent is almost double, and we’ve set ourselves to further close that gap. I don’t know if we can reach it, but we actually focus on 15gsm."

There is widespread agreement among packaging manufacturers that steel packaging’s future prospects are in the hands of brand owners and retailers. "Consumers by and large don’t recognise any significant difference between steel and aluminium; for them a can is a can," says Jansen. "They might feel the difference in weight, for example, at the time of consumption, but they’ll assume that it’s just thicker material. And for brand owners and retailers, too, both metals offer the same benefits."

Thomas argues that a key driver in terms of the choice between aluminium and steel is what brand owners are doing already. "If their filling lines are set up for aluminium, that’s what they’ll stick with. If they don’t have magnetic bands then they can’t run steel." Another driver, in years to come, may be cost. "Maybe in 10 years’ time, when it’s highly likely that energy costs will be the most critical factor, it could be that aluminium looks like a very expensive option," he says. In any case, Thomas adds, Ball plans to continue to offer both materials.

Whatever happens in the coming years, the metals industry is taking the fight to its younger rivals. With innovation on the multiple fronts of weight, openability and shapes, you wouldn’t bet against the can still being here in another 200 years.

MOVING FROM METAL

Signs of defection from metal to plastics are self-evident. Rexam has just supplied high-barrier heat-sealed containers incorporating a reclosable lid and designed to extend shelf-life over two years for the Danish Tulip brand’s market-leading pork luncheon meat (pictured below), entailing an investment in completely new filling lines.

The reason for the switch was added convenience, says Tulip supply chain director Jorgen Skaarup. "We’ve learned that our consumers find it difficult to open and empty regular metal cans, therefore it has been a specific target for us to develop new packaging that would create real differentiation in the marketplace."

Another high-profile switch has been Heinz’s extension into ‘snap-pots’, which has refreshed its baked beans line and accounts for 9% of total sales. It is, however, seen as supplementing sales rather than a replacement to metal.

Tesco-led sustainability language project publishes first report

packagingnews.co.uk: "The Global Packaging Project (GPP) has published a first report on its work to deliver a common language for packaging sustainability that sets out a number of indicators and metrics for improved dialogue.

The Consumer Goods Forum's sustainability group that is sponsored by Tesco and Unilever is running GPP to 'deliver a common framework and measurement system for better decision making on packaging and sustainability'.

The report – A Global Language for Packaging and Sustainability – looks at 52 indicators for the retail and packaging supply chain such as packaged product wastage, water usage and recycled content.
The project is being led by Tesco head of packaging Sonia Raja and starts from the principle of optimising the amount of packaging used without risk of increased product waste."

Massive effort needed to reach 65 percent recycling rate in UK

The Canmaker: "The UK’s aluminium can recycling organisation says that to achieve a 65 percent recovery rate would require 'massive effort'.

Announcing that the recycling rate for aluminium drinks cans had reached 55 percent last year, Alupro’s executive director Rick Hindley told Packaging News magazine: 'Our work shows that with the current infrastructure a 65 percent recycling rate can be achieved by 2020; to go beyond this will require a massive effort and significant infrastructure changes

Schemes for collecting cans consumed away from home and using the aluminium from energy-from-waste facilities would need to be developed, he said."

Another coffee maker returns to using cans

The Canmaker -: "David Hunt, managing director of CTC, said it is part of a move by customers towards the use of metal containers to convey a high-class image that plastics pouches cannot equal.

'Metal containers, with a recycling rate of 62 percent, help promote brands that have environmental concerns,' he said. 'Cans are much more recyclable than plastics, laminated pouches and multi-layer board containers,' he added. 'And the decision by Whittard is just another confirmation of this.'"

Ball to sell its plastics packaging business

The Canmaker: "Ball Corporation, the largest canmaker in the North American market, is selling its plastics bottle business to Amcor.

The deal, worth $280 million, includes five plants in the US that make PET bottles and preforms and polypropylene bottles. For the year to the end of March, sales for the division were $589m with pre-tax profits of $10m.

Sales for Ball in the plastics sector had been declining and represented about 8.5 percent of the Colorado-based company’s global sales of about $7.3bn.

Ball also announced that its board had authorised the buy-back of 12 million shares of common stock worth about $630m.

The exit from plastics packaging enables Ball to concentrate on its canmaking and aerospace businesses. It is the largest manufacturer of beverage cans in North America with 40 percent of the business, and also makes steel food cans and general line metal packaging.

Ball’s Asia Pacific division has also completed the $90m acquisition of Guangdong Jianlibao Group’s 65 percent interest in a joint-venture metal beverage can and end plant in Sanshui, China. Ball owned 35 percent of the joint venture plant, the largest in China with three canmaking lines, since 1992."

Tesco swaps glass bottles for plastic on own-brand spirits

packagingnews.co.uk: "Tesco is trialling plastic bottles for its own-brand spirits to replace glass containers as part of a raft of measures aimed at cutting its carbon footprint.

The supermarket giant, which has signed up to the second phase of the Courtauld Commitment, has moved its own-brand brandy into plastic bottles, which it said reduced packaging by 86% and saving 200,000kg of material."

Coca-Cola chooses Can of the Year bottles

The Canmaker : "Coca-Cola has started using lightweight aluminium bottles of the type that won The Canmaker magazine’s Can of the Year Award for 2009, and looks set to expand its use of them when a high-capacity manufacturing plant is expected to be completed in the US in about 18 months.

The plant will be built with an eventual capacity for 3.5 billion bottles by Exal Corporation, whose chief executive Delfin Gibert says has a number of customers keen to use the bottles. It is expected to be the first of a number of plants to be set up in various geographic regions throughout the world, a project that was first announced in 2007."

Weidenhammer wins first order for its 'plastic can.'

Factiva: "German packaging company Weidenhammer's PermaSafe container, a plastic alternative to glass jars and tinplate packs, will be used as packaging to a range of sausages marketed by German retailer Mueller's Hausmacher Warts. The PermaSafe container protects food products for a maximum of 12 months and cuts energy consumption during manufacture and transport because it is lighter than glass or metal packaging. The prototype developed for Muellers is an injection moulded, polypropylene container with a capacity of 150 grams and has a re-closable and easy-peel top."

At last, an alternative to traditional tinplate packaging

packaging: "Viscount Plastics and Dulux have achieved a breakthrough in plastic packaging technology set to invigorate the Australian paint industry. It will change the traditional use of the metal paint can forever.

Dulux has exclusively released Viscount Plastics’ new plastic container in its professional applicator product range.

To the uniformed, it may seem that Dulux is simply following the trend of its international peers. After all, plastic packaging technology is nothing new."

However, what is new and what has excited those of us who don’t enjoy watching dry paint contaminate our containers, is the innovative development of a proven paint skinning adhesion technology for the first time.

This patented technology has also provided a recyclable alternative to the traditional metal paint can.

The solution behaves in a similar manner to its metal alternative, of course without the tendency to dent or rust and is now being used commercially within the Australian and New Zealand paint market.

Coke announces plans to move drinks to 'bottle of the future'

packagingnews.co.uk: "Coca-Cola has unveiled plans to move its soft drinks to bottles made from a PET material that is partially derived from plants, and set a target of two billion bottles by the end of next year.

The company's PlantBottle packaging is partially manufactured from PET plastic developed from sugar cane and molasses crops destined to become ethanol. It is being introduced to selected product ranges.

The soft-drinks giant will bottle a range of its key brands, including Coca-Cola, Sprite, Fresca and Dasani, in the new packaging across Denmark, Canada, and the US."

Bao Steel supplies Coca-Cola with steel drinks cans

The Canmaker "Foshan Bao Steel Can Making Co, a subsidiary of Chinese steel producer Bao Steel, has started supplying Coca-Cola’s franchise bottler in Hong Kong with two-piece beverage cans.

Swire Coca-Cola Hong Kong Co is said operate the fastest canning line in China with filling speeds of up to 2,000 cans a minute.

More than 500,000 cans have been supplied by Bao Steel’s canmaking plant at Foshan in Guangdong province to Coca-Cola in Hong Kong."

Weidenhammer's reinvention of the can on supermarket shelves

Materials Handling World: "Weidenhammer Plastic Packaging, the relatively new plastics division of the Weidenhammer Packaging Group, introduced its world first PermaSafe concept at FachPack in 2007. As a 'reinvention of the can,' this innovative plastic packaging solution for sterilized and pasteurized food products is designed to compete with conventional glass jars and tinplate packaging.

At the same time, PermaSafe offers more creative options for marketing processed foods. Parallel to FachPack 2009, the first product packed in PermaSafe was launched on the market: Muller's Hausmacher Wurst will be selling its 'Heideverfhrung' sausage specialty in a PermaSafe package. This new Muller's product is primarily aimed at younger consumer groups. The innovative Weidenhammer packaging solution is a key element in the marketing concept."

Yes, we can

Ohio.com: "Cans are part of the next brewing renaissance, said John Kuhry, general manager at Anderson Valley.

''It's a phenomenon that's going to stay,'' he said. ''The economics are driving it.''

Industry experts say it's less expensive to package cans because brewers don't have to buy labels and glue — a savings of about $3 to $4 per case. And that doesn't include the savings on shipping costs, because a can weighs less than a bottle.

''I wouldn't be surprised that within a couple of years that everybody has cans as an alternative,'' said Jamie Gordon, a technical sales representative with Cask, a Canadian company that sells canning systems.

Brewers also are pushing advantages for the consumer.

''There are misperceptions about cans and canned beers being inferior to bottles,'' said Tim Ohst, brewery operations manager at Sly Fox Brewing Co., which has restaurants in Phoenixville and Royersford, Pa. The Sly Fox Pikeland Pils was the first craft beer in a can to win a gold medal at the Great American Beer Festival.

In fact, brewers said, the can is a superior vessel."

Wal-Mart Announces Sustainability Index

usnews.com: "When so many products come labeled as 'green' or 'natural,' finding the most sustainably-made stuff can be as tricky as comparing apples to oranges. But Wal-Mart will one day be able to tell you which of the two fruits is greener - along with every other product, from tennis rackets to telephones, in every Wal-Mart store.

The company's sustainability index, announced today at a meeting with suppliers and environmental leaders, will evaluate every Wal-Mart product's environmental impact throughout its entire lifecycle, and will condense the data into an easy-to-understand rating for shoppers. Needless to say, it is a major undertaking."

So how will Wal-Mart be able to tell us which brand of socks is the greenest? According to a company press release:

The company will introduce the initiative in three phases, beginning with a survey of its more than 100,000 suppliers around the world. The survey includes 15 questions that will serve as a tool for Walmart's suppliers to evaluate their own sustainability efforts. The questions will focus on four areas: energy and climate; material efficiency; natural resources, and people and community.

You can find the full questionnaire here. Though questionnaires are expected to be completed quickly - by Oct. 1 for top suppliers, to be precise - they are just one part of a process that the company expects will take several years. The sustainability index will be overseen by a consortium of universities, which will accurately measure each product's lifecycle impact, from raw materials to disposal. Though Wal-Mart is providing the initial funding for the project, President and CEO Mike Duke has stated that they will offer the index to collaborators on an open platform.

Though environmentalists are salivating at the thought (Treehugger's seemingly faint praise, "It's getting harder and harder to hate Wal-Mart," is actually a big wet kiss), the Wall Street Journal has pointed out one downside:

The most immediate impact will be felt by Wal-Mart suppliers, who will bear the costs of the company’s environmental mandates once again, at a time in which many are struggling economically due to the global downturn. Some advisers to Wal-Mart concede that the index is likely to raise supplier costs and thus affect the price consumers pay.

Though some of the cost may be passed along to the consumer, the index will not be fully implemented for at least five years.