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KN27013
KEY NOTE PACKAGING (METALS AND AEROSOLS) : MAY 2003
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This report covers: metal packaging, aluminium, plated steel, ferrolite, terneplate, backplate, metal alloys, open-top cans, aerosol cans, general line cans, metal closures, aluminium foil, collapsible tubes, barrels, drums, bulk containers, tinplate, beverage cans

Companies covered include: Ball Packaging Europe, BHP Billiton, Carnaudmetalabox, Greif UK, Impress Metal Packaging, Impress Metal Packaging UK, Lawson Maredon Packaging, Rexam, Afon Tinplate, Alcoa Closure Systems International, Cebal UK, Corus UK, Linpac Metal Packaging, Rexam, United Closure and Plastics, USC Europe UK,

TABLE OF CONTENTS

1. Market Definition 10
REPORT COVERAGE 10
MATERIALS USED IN METAL PACKAGING 10
Coated and Uncoated Steel 10
Aluminium 10
Metal Alloys 11
MARKET SECTORS 11
Light Metal Packaging 11
Open-Top Cans 11
Aerosol Cans 11
General-Line Cans 11
Metal Closures 12
Aluminium Foil 12
Foil Laminates 13
Collapsible Tubes 13
Heavy Metal Packaging 14
Barrels and Drums 14
Other Bulk Containers 14
Market TRends 14
General Trends 14
Recycling 15
Aluminium Recycling 16
Steel Recycling 16
ECONOMIC TRENDS 17
Population 17
Table 1: UK Resident Population by Sex (000 and percent), Mid-Years 1998-2002 17
Gross Domestic Product 17
Table 2: Index of Growth in UK Gross Domestic Product at Current Prices (index 1995=100), 1997-2001 18
Inflation 18
Table 3: UK Rate of Inflation ( percent), 1998-2002 18
Unemployment 18
Table 4: Unemployment Rate and Actual Number of Unemployed Persons ( percent and 000), 1998-2002 19
Household Disposable Income 19
Table 5: Index of Household Disposable Income (index 1971=100), 1997-2000 19
MARKET POSITION 19
Table 6: Total Packaging Consumption in the UK by Type of Material by Volume ( percent), 2002 20
Light Metal Packaging 20
Open-Top Cans 21
Open-Top Beverage Cans 21
Open-Top Food Cans 21
Aerosol Cans 22
General-Line Cans 22
Metal Closures 22
Aluminium Foil 23
Collapsible Tubes 23
Heavy Metal Packaging 23
Barrels and Drums 23
Other Bulk Containers 24
2. Market Size 25
THE TOTAL MARKET 25
Table 7: The Apparent UK Market for Metal Packaging by Value (£m at msp), 1998-2002 26
BY MARKET SECTOR 26
Table 8: UK Manufacturers' Sales of Metal Packaging by Value (£m at msp), 1998-2002 26
Light Metal Packaging 27
Open-Top Cans 27
Open-Top Beverage Cans 27
Aerosol Cans 28
General-Line Cans 28
Metal Closures 28
Aluminium Foil 29
Collapsible Tubes 29
Heavy Metal Packaging 29
Barrels and Drums 29
Other Bulk Containers 29
OVERSEAS TRADE 30
Table 9: Total Metal Can Sales by Value (£m), 1998-2001 30
Table 10: Total Metal Can Sales by Sector by Value (£m), 1998-2001 30
Table 11: Total UK Imports and Exports for Metal Packaging Containers† by Value (£m at msp), 1998-2002 31
Exports 31
Table 12: UK Can Exports by Value (£m), 1998-2002 32
Imports 32
A European Perspective 32
Packaging Manufacturers and Suppliers 32
Table 13: European Aluminium Foil Deliveries by Volume (000 tonnes net metal), 1998-2002 33
Table 14: Steel Used for Packaging Applications in APEAL Member Countries by Product Sector by Volume ( percent), 2001 34
Beverage Cans 34
Table 15: Production of Steel† for Food and Beverage Packaging in the EU (000 tonnes), 1998-2002 35
3. Industry Background 36
RECENT HISTORY 36
INDUSTRY SYNOPSIS 36
Table 16: Comparison of Companies Engaged in the Manufacture of Light Metal Packaging (£000, percent and £) 37
NUMBER OF COMPANIES 37
Manufacturers of Steel Drums and Similar Containers 37
Table 17: Number of VAT-Based Enterprises Engaged in the Manufacture of Steel Drums and Similar Containers by Turnover Sizeband (£000), 2002 38
Manufacturers of Light Metal Packaging 38
Table 18: Number of VAT-Based Enterprises Engaged in the Manufacture of Light Metal Packaging by Turnover Sizeband (£000), 2002 39
EMPLOYMENT 39
Manufacturers of Steel Drums and Similar Containers 39
Table 19: Number of VAT-Based Local Units Engaged in the Manufacture of Steel Drums and Similar Containers by Employment Sizeband (number of employees), 2002 40
Manufacturers of Light Metal Packaging 40
Table 20: Number of VAT-Based Local Units Engaged in the Manufacture of Light Metal Packaging by Employment Sizeband (number of employees), 2002 41
Table 21: Number of UK Metal Packaging Industry Employees, 1998-2002 41
Table 22: Metal Packaging Industry Sales per Employee by Value (£000), 1998-2002 42
REGIONAL VARIATIONS IN THE MARKETPLACE 42
DISTRIBUTION 42
HOW ROBUST IS THE MARKET? 42
Table 23: UK Domestic Sales of Metal Packaging by Value (£m), 1998-2002 43
Table 24: UK Sales of Soft Drink Cans by Value (£m), 1998-2002 43
Table 25: UK Sales of Beer and Cider Cans by Value (£m), 1998-2002 44
LEGISLATION 44
Packaging and Packaging Waste Directive 44
Climate Change Levy 45
Food Legislation 45
KEY TRADE ASSOCIATIONS 45
Aluminium Federation 45
Aluminium Foil Container Manufacturers' Association 45
Association of Drum Manufacturers 45
Association of European Producers of Steel for Packaging 46
Beverage Can Makers Europe 46
British Aerosol Manufacturers' Association 46
British Soft Drinks Association 46
Chemical Industries Association 46
European Aerosol Federation 47
European Aluminium Association 47
European Aluminium Foil Association 47
European Association of Aluminium Aerosol Container Manufacturers 47
Industry Council for Packaging & the Environment 48
Institute of Packaging 48
Metal Packaging Manufacturers' Association 48
Packaging Federation 48
Processing & Packaging Machinery Association 49
The UK Aluminium Packaging Recycling Organisation 49
4. Competitor Analysis 50
THE MARKETPLACE 50
Table 26: Selected Leading Companies in Metal Packaging in the UK by Turnover (£m), 2000/2001 50
Consolidation and Rationalisation 51
MARKET LEADERS 52
Afon Tinplate Company Ltd 52
Company Structure 52
Financial Results 52
Alcoa Closure Systems International (UK) Ltd 52
Company Structure 52
Financial Results 53
Ball Packaging Europe UK Ltd 53
Company Structure 53
Current and Future Developments 53
Financial Results 53
BHP Billiton PLC 53
Company Structure 53
Current and Future Developments 54
Financial Results 54
CarnaudMetalbox PLC 54
Company Structure 54
Current and Future Developments 54
Financial Results 55
Cebal UK Ltd 55
Company Structure 55
Current and Future Developments 55
Financial Results 55
Corus UK Ltd 55
Company Structure 55
Current and Future Developments 55
Financial Results 56
Greif UK Ltd 56
Company Structure 56
Current and Future Developments 56
Financial Results 56
Impress Metal Packaging Ltd 57
Company Structure 57
Current and Future Developments 57
Financial Results 57
Lawson Mardon Packaging UK Ltd 57
Company Structure 57
Current and Future Developments 57
Financial Results 58
Linpac Metal Packaging Ltd 58
Company Structure 58
Financial Results 58
Rexam PLC 58
Company Structure 58
Current and Future Developments 58
Financial Results 59
United Closures and Plastics PLC 59
Company Structure 59
Current and Future Developments 59
Financial Activities 59
USC Europe UK Ltd 59
Company Structure 59
Financial Results 59
OUTSIDE SUPPLIERS 60
Key Suppliers 60
Aerosol Cans and Components 60
Aerosol Valves 61
Machinery and Tool-Making Suppliers 61
Printing Inks 61
Sealing Compounds, Coatings and Varnishes 61
Recovery and Reprocessing of Aluminium and Tinplate 62
Aluminium 62
Tinplate 62
Caps and Closures 62
Drums 62
MARKETING ACTIVITY 63
5. Strengths, Weaknesses, Opportunities and Threats 65
STRENGTHS 65
WEAKNESSES 65
OPPORTUNITIES 66
THREATS 67
6. Buying Behaviour 68
INTRODUCTION 68
CUSTOMER PROFILE 69
Light Metal Packaging 69
Open-Top Cans 70
Open-Top Beverage Cans 70
Open-Top Food Cans 71
Aerosol Cans 71
General-Line Cans 71
Metal Closures 72
Aluminium Foil 72
Collapsible Tubes 72
Heavy Metal Packaging 73
Barrels and Drums 73
Other Bulk Containers 73
CONSUMER PROFILE 73
Carbonated Soft Drinks 73
Take-Home Beer and Lager 74
7. Current Issues 75
MATERIAL COSTS 75
RECYCLING 75
Recycling Schemes 75
Can Recycling in Europe 76
SUPPLY CHAIN — THE ROLE OF THE INTERNET AND E-COMMERCE 76
GLOBAL COMMERCE INITIATIVE 77
EUROPEAN MARKETS 78
Carbonated Soft Drinks 78
Alcoholic Drinks 78
THE IMPACT OF THE EURO 79
THE POLITICAL SCENE 80
Product Development 80
Nestlé Self-Heating Can 80
Two-Piece Steel Aerosol Cans 80
L'Oréal Body Spray 81
CONSUMER DEMAND 81
Legislative Changes 82
8. The Global Market 83
GLOBAL MARKETS 83
Europe 83
France 83
Beer 83
Carbonated Soft Drinks 83
Germany 83
Beer 84
Carbonated Soft Drinks 84
Italy 84
Beer 84
Carbonated Soft Drinks 84
Russia 85
Alcoholic Drinks 85
Carbonated Soft Drinks 85
Scandinavian Countries 85
Beer 85
Carbonated Soft Drinks 86
Spain 86
Beer 86
Carbonated Soft Drinks 86
North America 87
Canada 87
The US 87
The Far East 88
RECYCLING SCHEMES 88
9. Forecasts 90
INTRODUCTION 90
FORECASTS 2003 TO 2007 91
Exports and Imports 91
Table 27: Forecast Total UK Imports and Exports for Metal Packaging by Value (£m at msp), 2003-2007 91
The Apparent UK Market 91
Table 28: The Forecast Apparent UK Market for Metal Packaging by Value (£m at msp), 2003-2007 92
FUTURE TRENDS 92
Steel Packaging 93
Cans 93
Aerosols 94
Steel Drums 95
Aluminium Packaging 95
10. Company Profiles 96
Ball Packaging Europe Uk Ltd 97
Bhp Billiton Plc 99
Carnaudmetalbox Plc 101
Corus Uk Ltd 103
Greif Uk Ltd 105
Impress Metal Packaging Ltd 107
Lawson Mardon Packaging Uk Ltd 109
Rexam Plc 111
11. Further Sources 113
Associations 113
General Sources 114
Bonnier Information Sources 114
Government Publications 115

EXECUTIVE SUMMARY

The UK metals packaging market continues to be vibrant despite growing competition from plastics. In many key consumption areas, the UK continues to lead the rest of Europe with opportunities for metal packaging. In 2002, the apparent UK market for metal packaging containers reached an estimated £2.34bn, having undergone year-on-year increases since 1998.
The growth of the Internet and e-commerce is having a significant effect on all aspects of the supply chain, from manufacturing through to retail. Metal packaging manufacturers and all suppliers to the retail sector are being forced to become involved in e-logistics and e-commerce and to engage in electronic business-to-business contacts. For manufacturers, the Internet offers the potential to sell direct to the customer. While some manufacturers are taking advantage of the Internet to sell to distinct consumer groups and create new product offerings, most are more cautious, aware that their products would be unlikely to generate sufficient traffic to make an online service viable.
Steel and aluminium continue to compete in many packaging areas, such as aerosols and cans. A significant factor underlying can manufacturers' choice between tinplate and aluminium is material cost. Aluminium is often at a disadvantage because it is more prone to fluctuations in price than steel tinplate. As aluminium accounts for a higher percentage of the cost of a can than steel, any rise in aluminium prices can endanger the material's competitiveness.
The European population is ageing fast and by the end of the current decade a significant portion of the EU's total population will be aged over 65. This will have real repercussions for the UK metal packaging industry, as an ageing population will dictate shopping patterns. A growth in online grocery shopping is likely, as it can be a boon for people who cannot get out of the house easily or who value time over money.
In the coming years, a substantial reduction in exports from the UK into the major European markets is expected, although the domestic market will continue to hold up well, which will force most manufacturers to concentrate on the home market.
However, an increased amount of imports will be required, due to the strength of the UK market. The main multinational suppliers will start to utilise the surplus capacity at their continental European plants to supplement the output of their UK plants.

Text © 2003 Key Note

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