Glass,Bottle,Supplier,landscap marketing Glass Bottle Supplier landscape in Africa
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Africa is one of the largest continents in the World. It ranks second in terms of population numbers, while, on the hand, it is surprising to find that, Africa, as a region, has very less market share with regards to glass bottle production. The production share is estimated to be 3% of the global glass container market.Supplier Base:The glass bottle market is highly consolidated with regional players dominating in their respective countriesFor example, Consol glass and Nampak together constitute 90% of the market share in South Africa while Frigo glass constitutes 60% in Nigeria region The capacity of Glass bottle industry in Africa region was 4.48 MMT in 2014 with suppliers like Consol glass, Nampak, Frigo glass and others dominating the industry. The capacity for production of glass bottles in Africa region is less than the demand. Africa, as a region is a net importer of glass bottles with imports nearly $247.25mn in 2013. Countries like South Africa, Egypt are net exporters while the remaining are importers in Africa. Demand:The demand for Glass bottles in Africa is estimated to be 7.38 billion units in 2012 and is expected to reach around 8.76 billion units by 2017 growing at a CAGR of 3.5%. Major consumption of glass bottles in Africa is from Beverages industry. It has a market share of 56% and is estimated to grow at a rate of 3.5% for the next 5 years. Of the beverages industry, beer constitutes around 60%. From consumption with regards to country, South Africa was the major consumer of beer bottles consuming 60lts per capita requiring around 1.55mmt of resin in 2012 Market Outlook: DriversDownstream DemandGlobal demand for alcoholic beverages is expected to grow at 1.4% CAGR from 2011- 2016 while 5% is expected in the same period in African region. The downstream industry is making a steady recovery around the globe after the dip in 2008SustainabilityGlass packaging is claimed to have the highest green potential and lowest risk for global warming as it can be recycled continuously. The recyclability and sustainability advantage of glass containers is an important factor for its growth in the matured markets. 100% recyclable nature of glass is driving the glass container industry in terms of reusing the old bottles and reducing raw material cost by using churned glass as cullet.Global sourcing AdvantageLow cost regions such as India and China are being utilized by local consumers of glass bottles owing to reduced manufacturing costs. This increase in exports is expected to drive the overall bottle marketConstraintsSubstitutes Plastic is expected to substitute glass in the beverages category in the next 10 years. Also, convenience and fast life style are making the consumers prefer liquid carton packaging drinks over glass bottles in the beverage industry.Costs The price of glass bottles was increased by 1-2% in 2014 and is estimated to 0-1% in 2015 in comparison to 2013 and 2015 respectively. The main reason for the increase in prices is attributed to increase in price of raw materials and natural gas more than currency fluctuations Industry Dynamics and Updates From the supply base perspective, the industry is witnessing rapid changes in terms of merger and acquisitions, and consolidations among players. Added to this, some of the local suppliers are closing their plants owing to their poor financial performances. With respect to beer bottle market, Africa region is forecasted to have the highest growth rate for 2014-2020 period growing at a rate of 6% annually which is followed by APAC with 3.5% growth rate over the forecasted period.For example, companies like Zim glass are looking out for investments renovate their existing plants and also to increase their plant production capacity while suppliers likeKapiri glass and Meg glass have recently increased their capacity by raising funds through various sources. All in all, the glass bottle industry in Africa is showing positive indications for the players in terms of growth. It is expected that with good financials and strategies, the companies can benefit from the same.
Glass,Bottle,Supplier,landscap