Creativity-it's the root of survival and
often stems from desperation, or at the very least is most
evident in desperate times. The U.S. food can market certainly
appears to fit the mold.
The traditional food can market is shrinking
in the United States, forcing the industry to become more
creative, according to Gene Leo, project director of Omega
Research Associates, Pittsburgh.
"The problems for food cans will be
compounded by a sharp increase in the price of tinplate due to
the rise in iron ore, coke, energy and tin during the past two
years. In the United States, these costs will be passed through
by can makers to food processors and ultimately to the
consumer," he said. "In early October, steel producer
ArcelorMittal (SA, Luxembourg) announced a 15-percent increase
in the price of tinplate for its North American customers.
Despite surplus tinning capacity, steel suppliers in both
Europe and North America followed suit."
Cans for goods consumed by people are
forecast to decrease as processors choose alternative packaging
such as flexible and rigid plastics, Leo said, and the food can
industry might be in for more of a rough ride this year. Cans
for coffee and seafood will drag the entire category down,
although canned vegetables, soups and pet foods should help
boost shipments, Leo said.
"While pet food cans have been growing, it
offers little comfort to steelmakers, since about 60 percent of
pet food cans are made from aluminum. And beverage cans in the
U.S. and Canada are all aluminum. Overall, the long-term trend
for canned human food is downward. Per-capita usage has been
dropping steadily for three decades, and no turnaround is in
Flexible packaging is just cheaper to produce
and ship, driving its continued growth. It accounts for
approximately 300 million pounds (41.4 percent) of the total
725 million pounds of aluminum foil used in consumer packaging
each year in the United States, and its use is growing at a
rate of about 4.4 percent annually, according to the Flexible
Packaging Association, Linthicum, Md.
While no major breakthroughs in metal
packaging technology occurred in 2007, several developments are
expected to have long-term significance.
Can makers, for example, are working to
develop the North American market for retortable (sterilized),
peelable membrane lids on food cans. While peelable membrane
ends for dry food have been available for years, their use on
cans for heat-processed food is more of a challenge both in
terms of technology and costs. The peelable ends have been
doing well in Europe, but the U.S. market has been far more
difficult to crack.
"Metal food cans will continue to lose ground
regardless," Leo said. "These new innovations will only slow
the process, not halt it." The average American consumed 125
food cans in 1976; 10 years later that figure was down to 100;
now it's down to 75 cans.
U.S. demand for food containers (metal and
plastic combined) is expected to grow 3.3 percent annually to
$23.5 billion in 2011, or nearly 300 billion units, led by
demand for more convenient foods and value-added packaging,
Cleveland-based Freedonia Group Inc. said. Plastic food
containers will lead the way with a 6.3-percent annual
increase, followed by plastic bags and pouches at 4.4 percent.
The growth of bags and pouches-at the expense of paperboard,
metal and glass-will be led by cost and performance advantages
such as portability, and freshness protection.
However, there is a bright spot, Freedonia
said. Metal container competitiveness will benefit from the
growth of non-traditional can types, such as retortable
aluminum bowls, and innovations like microwaveable steel and
aluminum cans. And aluminum will post above-average gains due
to opportunities in faster-growing applications such as
containers for liquid meal replacements.