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Emerging Asian beverage can demand driving plant investment – Crown Holdings

By Mark Astley , 16-Feb-2012

A new line at the company's Malaysian facility will boost output by 650m cans per year.
A new line at the company's Malaysian facility will boost output by 650m cans per year.

Crown Holdings will boost its annual beverage can production capacity in China and Malaysia by nearly 1.5bn in order to meet growing demand in the countries.

The Philadelphia-based packaging provider has announced plans to build a new two-piece beverage can production plant in Nanning, China and install a second beverage can line in its existing Bangi facility in Malaysia.

The Nanning-based plant and the new Malaysian line will boost beverage can production capacity by 750m and 650m respectively.

Emerging markets such as China and Southeast Asia accounted for 41% of the company’s global beverage can volume in 2011.

The capacity expansion program will meet growing demand in the countries and boost sales across China and Southeast Asia, according to the company.

Strong emerging market demand

“Globally, beverage can volumes were up 9% on top of the 13% volume growth in the year ago quarter, primarily reflecting our emerging market capacity additions and continued strong demand in Brazil and Asia,” said Crown Holdings CEO John Conway.

“Our emerging market expansion program remains on schedule and budget. We are in the process of constructing three new beverage can plants in China which are expected to be completed by the end of the third quarter of 2012.”

Crown currently operate five beverage can plants in China and an additional seven two-piece beverage can plants in South East Asia, including three in Vietnam and one each in Cambodia, Malaysia, Singapore and Thailand.

“Importantly, all of these investments are being made to meet local demand. We continue to evaluate many new and exciting opportunities but remain committed to conservative deployment of capital by growing with our customers to meet long term demand in promising emerging markets,” said Conway.

Beverage can output boost

Crown Holdings currently operates five facilities in China.

The company expects to begin production at an additional six facilities, including Nanning, by mid-2013.

The Nanning plant, which will have an initial annual production capacity of 750m two-piece 33cl aluminum beverage cans, is expected to be operational by the end of Q2 2013.

It will also have the ability to produce 50cl cans.

The new Malaysian line, which will provide additional annual production capacity of approximately 650m two-piece 33cl beverage cans, is expected to be operational in the first quarter of 2013.

The new Malaysian line, which will provide annual production capacity of approximately 650m two-piece 33cl beverage cans, will bring the Bangi facility’s total output to more than 1.2bn.

“Looking ahead to 2012, the company’s position and prospects are excellent. Our goal is to maintain strong healthy business in the developer markets of Western Europe and North America. At the same time we will continue to grow our emerging markets businesses in South America, Eastern Europe, the Middle East, China and South East Asia,” Conway added.

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