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Chinese can maker ORG to boost capacity

By Dominique Patton, 20-Apr-2006

Related topics: Packaging, Product & Supplier news in Asia Pacific

Leading Chinese can maker ORG says it will produce 1 billion food and drink cans this year, as new capacity comes on stream to meet rapidly rising demand.

The private company produces two-piece and three-piece cans for Chinese tomato processor Zhong ji and also names Red Bull as one of its top two clients. Both companies are seeing strong growth.

"We're producing 24 hours a day and still can't meet demand from our customers who are in turn seeing growing demand," explained Yu Kai, secretary to the general manager.

ORG will open a new plant in Hubei province in May, allowing it to up its capacity from the 720 million cans it produced last year. By 2008, the group wants to produce 1.5 billion cans.

The demand for cans - often steel, tin and aluminium combinations (three-piece) - has expanded rapidly in China in recent years alongside the rapid growth in processed food. Cans made from steel with tin tops are stronger than aluminium cans and therefore better suited to the export market and the transport conditions within China.

ORG, one of China's largest can makers, will have seven plants around the country allowing it to reach local markets and reduce transport costs for customers.

The firm is also trying to learn more about foreign can making technology in a bid to tap into new markets. It has few export clients currently owing to the high prices of exporting steel cans but is considering starting production abroad.

On the domestic market, it is trying to draw new customers in the beer sector, promoting a 5-litre steel can at the Packaging 2006 exhibition in Beijing this week.

"We wanted to create a product for household use," Yu told AP-Foodtechnology.com. "It will be cheaper than buying several smaller containers but also convenient to store."

The large can also has a plastic opening, supplied by US-based Blue Ribbon, which allows the consumer to reseal the container, keeping the beer fizzy for up to two years after opening.

"The goal is to change the habits of beer drinkers in China," said Yu, encouraging them to switch from glass bottles and aluminium cans to the larger steel container.

Can consumption in China is still significantly lower than western markets. Industry estimates put per capita can consumption for both two-piece and three-piece cans at around 10 cans per capita, less than 5 per cent of the figure for the United States.

Metal only accounts for 8 per cent of the country's €30 billion packaging market.