Tinplate price increases hit headlines
Release date: 27 Apr 2009
itri.co.uk
Recent annual contract tinplate price rises are raising concerns not only with can makers but also fillers and even supermarket chains. On Friday the Wall Street Journal described customer reactions in the USA and Europe, while the South African press has reported widespread complaints about particularly large price rises implemented there this month.
The WSJ reports that the average price of tinplate is expected to rise 25% to 35% this year in Europe, and 15% to 20% in North America, quoting evidence from “can manufacturers, packaged food companies and others”. Its article suggests that cans account for between 8% and 20% of total costs of canned soups and vegetables and quotes comments from some of the biggest brands.
H.J. Heinz Co. says global tinplate costs rose 40% in the last year. The Pittsburgh-based company is considering switching to plastic packaging or pouches for some products. "As energy and tin plate prices continue to rise, reducing our can packaging costs has become more important than ever," said Michael Mullen, a Heinz spokesman. Meanwhile Anthony Sanzio, a spokesman for Campbell, said, "The price of tinplate is obviously important to us. We have been monitoring the situation closely and discuss it regularly with our can suppliers."
In South Africa supermarkets and the South African Fruit and Vegetable Canners Association have threatened to seek a Competition Commission investigation into pricing there, following ArcelorMittal SA’s announcement of tinplate price increases of 68.9% for food products and 78.6% for beverage products from the start of this month. However a company spokesman explained that the price rises were based on a transparent formula linked to international prices and the Rand exchange rate, which has depreciated sharply in the last year. He also noted that customers had been offered a mid-year review of prices last October to cushion the blow, but this had been turned down. |
