Rexam jumps on ‘fantastic’ opportunity for beverage cans in India

By Rachel Arthur contact

- Last updated on GMT

Rexam is investing $77m in a new manufacturing plant, with a second to follow
Rexam is investing $77m in a new manufacturing plant, with a second to follow

Related tags: Coffee, Rexam

The beverage can remains a ‘novel’ form of packaging in India, according to manufacturer Rexam. But having seen a 72% increase in sales volume in 2014, the company predicts the packaging will become much more popular. 

The beverage can currently represents just 1% of the Indian beverage packaging market. But with GDP in the country rising, Rexam wants to grab a ‘fantastic’ opportunity for cans.

Earlier this year, it announced plans for two new manufacturing plants in the country.

Mumbai, Sri City, Jaipur…

“India is a very attractive market, with significant growth opportunities alongside major global and regional customers,” ​Craig Jones, AMEA sector director for Rexam, told BeverageDaily.com.

“The country has a population of 1.3bn (growing at 2% per annum), and 60% of that population are below the age of 30. We expect GDP to grow at 8% per annum – representing fantastic growth opportunities for the drinks can.”

The company sees more beverage brands choosing cans, while consumers are seeking more soft drinks and premium beers. Across Asia, more consumers are joining the middle class and leading western consumer lifestyles.  

“The Indian beverage packaging market has been predominantly dominated by cartons, sachet, PET and glass for many years, with the can being perceived as a higher end product,” ​Jones said.

“In recent years, beverage brands have recognized the benefits that the can offers to protect their product and appeal to new consumers.”

Local teams on the ground

Rexam says Asians consume less alcohol than Europeans and Americans, primarily  for cultural reasons. Iced teas and coffees (which lend themselves well to the beverage can) are increasing in popularity, with 21% consuming these beverages.

In a region where product safety and integrity has been pushed to the front of consumers’ minds, Rexam says the beverage can is perceived to be a safe and a reliable package.

Rexam already has one beverage can plant in Mumbai, with a capacity of 950m cans. In February the company announced a new £50m ($77m) plant​ for Sri City (in the south of the country) which will add production capacity of 880m cans. It is due to open in 2016.

A similar plant is to follow in Jaipur. 

Cans from the new plants will be used to support global and regional customers who want to expand in the region, as well as catering for new customers.

When asked what the biggest challenges in the country are, Jones said it was important to understand local culture.

“As a global company we have vast experience entering new markets and cultures.

"At Rexam we believe it’s important to work alongside the country’s culture and for this reason we have local teams on the ground who have the expert knowledge and skills to support our customers and grow the business in the region.”

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