|| ECO-FRIENDLY "TINPLATE PACKAGING" FOR CONSUMER CONVENIENCE ||
|| Packaging: The key driver to catapult growth of processed food - Abstract ||
|| Packaging: The key driver to catapult growth of processed food - Conclusion ||

B. L. RAINA, Chairman IIP
Managing Director, The Tinplate Company of India Limited

ECO-FRIENDLY "TINPLATE PACKAGING" FOR CONSUMER CONVENIENCE

Developments for business and trade have never been better than what we are witnessing recently and expectations are tremendous. We are today on the threshold of great challenges and fantastic opportunities.

There is absolutely no doubt that growth will be fuelled through developments related to roadways, power, communications, demographic changes, consumer demand patterns, IT skills etc. However, the core of India's economy, Agriculture, will continue to have a dominant bearing on the extent of rate of growth. In fact, developments in agriculture and downstream value additions will have a tremendous multiplier effect on economic growth.

Some well known facts need a re-iteration at this point:

• India is the world's second largest producer of food next to China, and has the potential of being the biggest in the world. Apart from being self sufficient in grains production, India is the second largest producer of fruits and vegetables in the world, the largest milk producing country and with marine sources comprising more than 8000 kms coastline.

• Currently, about 20-25% of fruits and vegetables are lost due to spoilage at various post harvesting stages. Only 2-4% of production is commercially processed. For example, India is the largest producer of mango (59% of world production) but contributes only 13.55% of world mango export. Total 2.35% mangoes produced in India are processed. Hence, potential is tremendous. Already, signs of leveraging such opportunities are visible.

• The fruit production in India has recorded a growth of 3.9% whereas the fruit processing sector has grown by 20% p.a, albeit on a smaller base. Processing of vegetables is also expected to increase from 2% levels to about 10% in next 10 years.

The food processing sector in India has been accorded a very high priority by the Government of India with a number of fiscal incentives to encourage commercialization and value addition to agricultural produce. In fact, the government has even gone as far as advertising, for promoting consumption of processed food amongst the public in national newspapers. However a lot needs to happen on investments in processing and packaging technology front.

Leave aside India, it is estimated that as much as 50% of the food in the developing world is spoiled due to lack of effective packaging. In comparison, in some of the major fruit and vegetable producing countries such as USA, Brazil, Malaysia over 65% of the produce is commercially processed. The difference is more than 180 degrees!!!!

The food processing industry will provide a fillip to India's growth. The point is further reinforced when we note that despite the value addition in the food sector being only 7% today, food is the highest economic multiplier in the Indian Industries, estimated at 2.4 times. Compare this with other value additions: China (23%), Phillipines (45%) and UK (88%).

The food sector probably is the single largest user of packaging, be it in types, forms and varieties. Anywhere between 45 - 60 % of the packaging consumed is by the food sector, the world over. Rightly said, the packaging and food sectors are complimentary to each other - in fact, the packaging industry has a very significant role to play as a support for the "Food Factory of the World".

From being primarily exporters of commodities, it is time we move up the value chain and become a global player for processed food since we are fortunate to be blessed with considerable natural resources. The industry needs to formulate a plan of action to convert these into products of international standards and enhance their acceptability. The significance and contribution of packaging - in product distribution and marketing cannot be undermined. The primary role of packaging is to "protect" and "preserve" any packaging media for that matter has to have excellent barrier properties and enhance the shelf-life of the packed produce. Longer shelf - life means availability of products in the off-season which means better realizations for the value chain.

However, it is also important to note that invariably it is the package that the distributor, a retailer or for that matter the consumer sees first and not the product. The first impression about the product is always created by the package. Packaging has become synonymous with the products - for example, when we think of a drink, our immediate recall is of the container / label used for the product. Packaging is therefore the heart of any marketing strategy.

In order to support the marketing strategies, the packaging industry needs to consider the changing needs of consumers living in a society where convenience and choice are commonplace. Technological advances are the order of the day, often impatiently awaited. To meet growing consumer expectations and environmental challenges, the packaging industry needs to usher in new technologies and innovative approaches. The issue of convenience needs stressing here arising out of demographic changes: more single person households, more working women, nuclear families, growing aged population and sophistication of eating habits.

The packaging industry has an opportunity in hand but also needs to play the role of good corporate citizen and needs to perform the role of an educationist for the public at large.

Whilst a host packaging alternatives are available - name it, glass, metal - aluminium or tinplate, paper & board, Tetrapak, plastics, PET, etc, the selection of packaging material depends on its ability to render itself to consumer convenience, cost effectiveness and environment friendliness.

In line with the incentives being offered by the government for food processing, it will be imperative to provide similar incentives to the packaging industry to ensure effective promotion of WTO compliant, yet cost effective solutions for export of food. To reiterate, food and the packaging are inseparable.

Coming from the position where I am, tinplate as a packaging medium scores excellent on all three attributes, especially when we consider the life-cycle cost of the product / media. Its property of re-cyclability has ensured that tinplate occupies niche position for food packaging, especially in the developed world, with approx. 70% of retorted processed food being packed in tinplate. Tinplate provides excellent barrier properties, strength and formability, amenability for excellent printing and graphics, retorting, providing long shelf life to the product and above all eco-friendliness. Even in terms of cost effectiveness, considerable progress has been registered through light-weighting and lower coating of the media - in fact, over 35% weight reduction has taken place over the last 30 years for similar usages. On consumer convenience front today we have different shapes and sizes of Easy Open Ends (EOE) and Peel off membranes. The shaped cans are the another innovation has resulted in greater acceptability of a can as a differentiated marketing tool for the brand owner.

Despite such credentials, tinplate accounts for just 5% of the total packaging material used in the country as compared to 11% in the developed world. Looking at the data in another manner, India's per capita consumption is at 0.3 kg whereas countries like China are at 1 kg and of course the developed world at around 10-15 kg.

It is for this purpose that we in the tinplate industry have created a forum of steel & tinplate producers, can makers & now fillers i.e. the Tinplate Promotion Council. It has been formed with the objective to promote the usage of tinplate in the country based on its various technical, environmental and economical facets. TPC is focused on product, development, marketing aspects of tinplate manufacture and usage as well as perform its role of educating the public at large. TPC has been in close interaction with the Indian Institute of Packaging, which, as a national body has tremendous potential to promote the requisite packaging medium and create awareness amongst consumers on the specific packaging requirements of different commodities. The TPC also organized the first ever International Seminar on Tinplate in India in January 2002 and is now focusing on consumer convenience and packaging solutions. In order to promote such innovation, TPC hosted an Award Nite on 13th Dec 2003 concurrently during PACKcon 2003 and FoodprO 2003, to recognize the efforts of the can-making industry.

In conclusion, the relevance of the Indiapack 2004. India with enviable wealth of resources of fruits and vegetables, dairy, marine and agricultural products is set to emerge as a global leader in the processed food business, given of course the right direction and inputs. The government too has recognized this potential and is pro-actively prioritizing the food processing industry for growth. The success of this industry, besides other factors, depends largely on packaging. Global marketing of our food products will to a large extent depend on our ability to deliver these products in packaging forms that will not only ensure freshness of the edibles but also meet consumer convenience and growing environmental concerns.