Packaging Order To Hit Tinplate Cos
Tinplate manufacturers are bracing for another setback with the government contemplating the withdrawal of the compulsory ISI certification of prime tinplate used for packaging vanaspati.
It is understood that the concerned ministries -- the ministries of food and civil affairs and health and family welfare -- are also considering amendments to the notifications in the use of raw materials for manufacturing tin or plastic containers for edible oil as well as vanaspati to the Bureau of Indian Standards (BIS) specifications.
Tinplate Company of India Ltd (TCIL) and Steel Authority of India Ltd's (SAIL) Rourkela plant, which are the two major players in the Rs 900-crore domestic tinplate market, would be the biggest casualties if the move to lift the requirement of ISI certifications comes into effect. SAIL and TCIL have a total installed capacity of 2.40 million tonne which is more than adequate to sustain the total domestic demand of 2.20 million tonne per annum. Of the total consumption of 2.20 million tonne, 1.5 million tonne is consumed by the food-packaging sector.
While global packaging practices dictate that food products should be packed in prime quality tinplate, figures indicate that in India, the 1.5 million tonne of tinplate consumed by the food packaging industry is serviced by non-prime quality tinplate which is imported.
In fact, of the total consumption of tinplate in the country, 70 per cent is met through imports. This situation has forced both TCIL and SAIL to cut down production by 50 per cent of their installed capacity. Prime tinplate, which is the packaging material recommended for food products like vanaspati and edible oil, has a price range of $1,000-2,000 per tonne globally but waste/waste and non-prime tinplate finds its way into the country through imports at $350 per tonne.
Moreover, despite the BIS prescription that 15-kg vanaspati tin containers should be made of prime tinplate, there are believed to be gross irregularities in packaging. According to tests conducted by the Central Food technological Research Institute, Mysore, it has been found that branded edible oil 15-kg tin containers have used non-prime tinplate.
According to steel ministry sources, the tinplate industry could well be looking at a virtual closure of operations since the government is yet to act on various anti-dumping pleas made by manufacturers like TCIL. "The state of the industry is clear from the fact that tinplate prices have not been revised for the last seven years," sources said.
The steel ministry, on behalf of the tinplate industry, is pursuing the case for anti-dumping on imports of waste/waste and cheap non-prime tinplate.
An anti-dumping petition headed by the Indian Tinplate Manufacturers Association is currently pending with the union commerce ministry.