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AG16-3
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Inside: Pharmaceutical packaging Gujarat glass: part 2 Asian float profitability Fenestration in Russia
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Contents: AG 16-3
! e n i h s n u s e h t Sp re a di n g
News that a Dubai company has won an order to supply a solar glass facade to a school in Denmark in what is one of the largest projects of its kind in the world is a welcome breakthrough in the international market for solar glass. Now it wants to wants to introduce the same technology in buildings across the UAE. Emirates Insolaire, a unit of Dubai Investments, will supply about 12,000 coloured solar glass panels to the Copenhagen International School. Once fitted, the panels will create one of the largest photovoltaic (PV) facades of its kind, the company said. The facade will supply more than half of the school’s annual electricity consumption, producing about 300 megawatt hours per year. The panels are part of the building’s photovoltaic system, which allows solar panels to be integrated directly into building structures such as windows. “The project is very important for Emirates Insolaire and offers the company significant inroads into Europe and the rest of the world for its unique technology,” said Rafic Hanbali, a managing partner of Emirates Insolaire. “Emirates Insolaire has brought in a paradigm shift in solar applications by introducing aesthetic appeal to facades coupled with added efficiency.” Construction has started and is expected to be completed by the end of June. It also plans to install its Kromatix technology on two buildings in Dubai Investments Park. Mr Hanbali said the company was targeting a little more than 1 MW by the end of the year. “But what I expect is to have about 15,000 to 20,000 square metres of our technology installed on 10 to 15 buildings over the next 20 months in Dubai, and about 50,000 to 70,000 sq metres worldwide.” He said the technology could meet from 10 to 50 per cent of a building’s energy requirements. In Dubai, each square metre will produce above 200 kWh annually.
Regulars 8 Welcome
Packaging developments spell challenges for glass.
10 Headline News
Openings, closures and industry moves from across Asia.
16 Global View
Our eye on the international arena.
20 People and Places Movers and shakers, ups and downs.
22 Batch Raw material news and views.
24 Comment & Analysis BIPV: kick-starting 2016? 6
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26 www.asianglass.com
www.asianglass.com Features 26 Pharmaceutical glass packaging
Yogender Malik looks at how developments in pharmaceutical packaging are proving a boon for container manufacturers in some of the continent’s most dynamic regions.
34 Float glass profitability: p1
In the first of a two-part focus, AG looks at the relative profitabilities of operating float glass plants across Asia in direct comparison with other locations.
48 Gujarat: a state of expansion
Increasingly seen as India’s manufacturing hub, Gujarat continues to grow in importance across all industrial sectors. AG looks at how flat and processed glass makers are getting in on the act.
52 Russian fenestration
Stanislav A. Chesnokov, and Alexander G. Chesnokov,of the Glass Research Institute, Moscow, Russia, discuss glazing developments within Russia..
Looking forward Architectural Glass Kiev 2016, Kiev, Ukraine
19-21 Jan
Glass & Aluminium Middle East, Cairo, Egypt
18-20 Feb
Fensterbau Indian 2015, Mumbai , India
25-27 Feb
Baku Glass, Baku, Azerbaijan
1-2 Mar
PV Japan, Tokyo, Japan
2-4 Mar
Istanbul Glass & Window Expo, Istanbul, Turkey 9-12 Mar China Glass, Shanghai, China
11-14 Apr
Glass & Aluminium Saudi Arabia Riyadh, Saudi Arabia 30 Apr - 3 May Glassman Middle East, Abu Dhabi, UAE
10-11 May
Windoorex, Muscat, Oman
15-17 May
SNEC, Shanghai, China
24-26 May
Mir Stekla, Moscow, Russia
6-9 Jun
Glass South America, Sao Paulo, Brazil
7-9 Jun
ICCG 11, Braunscheweig, Germany
12-15 Jun
Intersolar Eurpoe, Munich, Germany
22-24 Jun
June Glasstec, Duesseldorf, Germany
19-22 Sept
ASEAN Federation of GM
17-28 Oct
Glassbuild America, Las Vegas, Nevada
19-21 Oct
Glasstech Asia, Ho Chi Minh City, Vietnam
24-26 Nov
ZAK Glasstech, Mumbai, India
2-4 Dec
Cuba Glass, La Habana, Cuba
6-7 Dec
AFGM TBA
www.asianglass.com 48 52 In Focus
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54 Window
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Anaylsis AG talks to Dave Mackay of USA-based Stewart Engineers about the progress of one of the most exciting developments in the region’s float glass industry… Analysis and insight into Russia.
58 Refractory Zone
In his latest exclusive offering to Asian Glass, Carlo Ratto discusses how the fused cast family is in need of a new sibling… www.asianglass.com
Asian Glass: now for mobiles, ipads and androids
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Welcome
P
ackaging trends continue to evolve, and for glass it seems that it is being squeezed in a number of key sectors. For example, high-end food and drink companies, as well as alcohol brands, are continuing to choose plastic over glass for a variety of reasons.
CONTACT DETAILS
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SEE US AT:
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MOSCOW, RUSSIA
Inside:
Pharmaceutical packaging Gujarat glass: part 2 Asian float prof itability Fenestration in Russia
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lysis and much, muc h more! “We chose plastic because it uses less packaging by weight than similar glass bottles—and helps position these innovations as premium, yet affordable. They also allow for safer handling for our customers,” says creative officer John Nunziato of Little Big Brands. As Nunziato mentions, polyethylene terephthalate (PET) bottles come with a range of benefits. For example, a 750ml glass bottle weighs around 400g, where a 750ml PET bottle weighs about one-eighth of this at 54g. Transport-wise, their lower weight makes PET bottles easier and more environmentally friendly to move. Plus, their robustness makes them far safer to transport, too.
We can expect to see more beverage companies take a step away from glass and make the move toward plastic bottles over the coming year. Many beverage brands will experiment with innovative materials for their bottles and packaging, and we may even see some trends emerging. One company trying something different is whiskey maker Stillhouse, who has opted for metal packaging for its independent spirit brand.
EDITORIAL Publishing Director Andy Skillen Email: askillen@asianglass.com Direct line: + 44 (0) 208 123 0196 Fax: + 44 (0) 207 183 7196
ADVERTISING AND DESIGN Advertising Sales Valerie Adamson Email: vadamson@asianglass.com Direct line: + 44 (0) 208 133 5273 Paul Russell Email: prussell@asianglass.com Direct line: + 44 (0) 208 638 0619 Production and design Tim Mitchell Email: tim@bowheadmedia.com Direct line: + 44 (0) 208 123 0839
RESEARCH Research Manager Alex Murphy Email: amurphy@bowheadmedia.com Direct line: + 44 (0) 208 123 0839
Stillhouse believes its 100% stainless steel packaging is an industry first. This alternative material choice harks back to prohibition days, and we can really see other spirit brands following in their footsteps Environmentally friendly packaging is nothing new, but it is an ever-increasing trend. Companies and consumers alike are becoming more aware of innovative recycling methods and the benefits of implementing these. Furthermore, big alcohol brands such as Carlsberg are leading the way by actively supporting research into biodegradable beverage bottle innovations. Its on-going partnership with EcoXpak is set to see key developments in zero-waste material use as its goal is to create a 100% biodegradable beverage bottle made from green fiber. The future looks bright for premium recycling methods, too. Zero Waste Boxes won Environmental Leader’s 2015 Top Product of the Year Award, and you can read more about them here. In the soft drinks industry, brand giants such as Coca-Cola are leading the way with eco-friendly packaging, and this is sure to encourage many other beverage brands to follow in its footsteps and go green with their packaging. Stand-up pouches are growing in popularity, and the next 12 months is set to see this trend continue. Brands love these formats because they offer the ability to print vivid, clear designs and allow true creative freedom for packaging designers. What’s more, stand-up pouches provide greater possibilities for brands to differentiate from competitors and stand out on the shelves. Stand-up pouches are lighter than metal cans or plastic bottles, and empty pouches can be shipped and stored flat, so they take up a fraction of the space in a truck, meaning their environmental footprint is minimal. This rising trend is predicted to reach $37.3 billion by 2018. Time for glass to fight back…Happy Reading! Happy reading!
EXHIBITIONS AND CONFERENCES Contact the team on: Email: events@bowheadmedia.com Direct line: + 44 (0) 208 123 0839
Bowhead events Creating Opportunities: Delivering Results OVERSEAS OFFICES
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HEADLINE NEWS ASIA Opening time for PGW auto glass plant China Pittsburgh Glass Works LLC (PGW), a world-leading supplier of automotive glass, has announced the grand opening of a new, state-of-the-art automotive glass manufacturing facility in Zibo, China. The facility, built as part of a joint venture with Shandong Jinjing Science & Technology Stock Co., Ltd. (Jinjing), a leading supplier of float glass in China, began construction in 2014. The construction proceeded on schedule and the joint venture, Shandong PGW Jinjing Automotive Glass Co. Ltd. (PJG), is now in commercial production. "The opening of the PJG facility is a key milestone for the automotive industry as it provides the technology and quality to serve the Chinese auto industry with world class products and services," said Joe Stas, President and CEO of PGW. "With the establishment of this facility, we can support our customers on a truly global basis." PJG uses the latest in automotive glass manufacturing technology and is a showcase
of the best manufacturing and operations practices. The facility, which began productions earlier this year, is currently delivering windshields that meet the toughest automotive standards. The new facility, along with an embedded product development and customer support center, extends PGW's global reach for its innovative product and process technologies in order to serve the needs of the car producers in the important China market. The addition of this modern automotive glass plant represents a significant step in the maturation of the Chinese automotive market. With Chinese consumers, and hence the vehicle manufacturers, demanding world class technologies in their cars, the PJG facility will be able to satisfy that need. As the Chinese automotive market faces tough challenges with the upcoming fuel economy and emissions targets set by the regulators, the PJG facility is equipped to make glazing that will help vehicle manufacturers
meet these increasingly tougher targets. "The facility will produce some of the most complex parts that are being demanded by the discerning Chinese customer/consumer, while also being very cost competitive due to the efficient design and operations," reported Paolo Cavallari, Senior Vice President and General Manager, Auto-OEM business at PGW. The plant is capable of producing windshields that require technologies like Heads Up Display (HUD), full surface heating, complex bend, lightweight glazing, solar performance products and antenna systems, among others. The best-in-class lightweight and solar performing glazing products reduce fuel consumption of a vehicle and help decrease greenhouse gas emissions. When fully operational, the new facility will have capacity for twomillion car-sets and employ in excess of 350 workers. The facility size is 34,600 square meters. Pittsburgh Glass Works, a subsidiary of LKQ Corporation,
Piramal records highest ever turnover Sri Lanka Piramal Glass Ceylon PLC (PGC) has recorded its highest ever annual turnover of Rs. 6,755 mn and a profit after tax (PAT) of Rs 654 mn. With this achievement the Board of Directors has proposed 35% dividend maintaining its consistent policy of dividend pay-out ratio. Revenue achieved for the year was Rs 6,755 mn depicting a growth of 17% as against Rs. 5,792 mn of the previous year. The revenue growth was mainly contributed by the domestic sales which saw a significant growth of 23% from Rs. 4,422Mn to Rs. 5,436 mn . The
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asianglass AG 16-3
major part of growth was backed by food and beverage segments. Piramal Glass CEO and Managing Director Sanjay Tiwari said the company’s furnace which was built in 2007 is due for rebuilt during F2017. The relining together with enhancement of capacity from existing 250 tonnes per day to 300 tonnes per day and technological improvements to the existing machinery by adding further flexibility is scheduled to be carried at an investment of Rs. 3 billion during the second quarter of the current financial year. This upgraded facility will
help the company to service the present and future increased demand in the domestic segment for all industries namely food and beverages, pharmaceuticals, agro chemicals, liquor the upcoming segment of virgin coconut oil. The F16 Q4 reflected a marked improvement against that of the similar quarter in F15 due to exceptional sales during the festive season. The total sales during the quarter grew by 18% from Rs 1642 mn to Rs 1938 mn of which the domestic sales and exports were up by 21% and 6% respectively.
manufactures and distributes automotive OEM windshields, rear and side windows, sunroofs and assemblies for auto and truck manufacturers worldwide, and manufactures and distributes automotive replacement glass for the automotive aftermarket in North America. Headquartered in Pittsburgh, Pennsylvania, PGW maintains automotive float glass, glass fabrication and assembly, and JIT sequencing capability in nine factories at Berea, Kentucky; Creighton, Meadville and Tipton in Pennsylvania; Crestline, Ohio; Evansville, Indiana; Elkin, North Carolina; Evart, Michigan; and Środa Śląska, Poland; and a joint venture facility in Tepeji del Rio, Mexico. PGW also operates a global Automotive Technical Center in Rochester Hills, Michigan and a sales and product development center in Ettlingen, Germany. PGW distributes automotive replacement glass from a Master Distribution Center in Chillicothe, Ohio and 109 branch operations in the U.S. and Canada.
NEWS IN BRIEF Gulf Glass Manufacturing has reported a decrease of 4.3% in profit in the first quarter of 2016 as compared to the same period in 2015, according to a statement.The earnings decreased to about KWD 602,300 ($2 million) in Q1-16, from nearly KWD 629,300 ($2.09 million) in Q1-15. Gulf Glass stock closed at 410 fils, after falling 3.53% one the news, as liquidity reached around KWD 5,330 when nearly 12,660 shares were exchanged.
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Dumping investigation Obeikan Glass to commence production instigated of coated glass Iran/India Indian Directorate General of Anti-Dumping & Allied Duties, is currently investigating dumping allegations of clear float glass in the country from Iranian float glass producers. The dumping allegation application has been filed by three Indian float glass producers ( Saint Gobain, Gold Plus and HNG Float Glass). Indian authorities have admitted the case, while observing in its order that prima facie an injury has been caused to the domestic industry due to imports of clear float glass from Iran. The period of investigation (POI) for the purpose of the investigation is from January, 2014 to June, 2015. However, for the purpose of analyzing injury, the data of previous three years, i.e., April 2011 to March-2012, April 2012 to March 2013, April 2013 to March 2014, and the period of investigation (POI) will be considered. Indian authorities had imposed anti-dumping duty on float glass
Saudi Arabia imports from UAE, Saudi Arabia and Pakistan in 2014. However, Iran was not included in that investigation. Iran has added a considerable capacity in float glass segment in last three years and one more float glass plant is under construction in the country. In next two years, it is anticipated that Iran will have an overcapacity in its float glass segment. One of the lowest energy cost, ready availability of key raw materials and a vast domestic and regional market has spurred the Iranian producers to add huge capacity in the float segment in recent years. Since, country’s domestic market is unable to absorb the huge capacity of float glass, Iranian glass producers have been increasingly seeking new export markets in recent years. Establishment of a major float glass plant in Saudi Arabia has limited the country’s exports in that country. This has forced Iranian producers to look to other nearby destinations for exports.
Saudi Arabian float glass producer, Obeikan Glass Company has commenced commercial production of solar control glass at its Yanbu based facility .The JV for coating line with Japanese company, Asahi had initially been signed in 2014. Obeikan Glass is owned by Saudi conglomerates Obeikan Investment Group and Saudi Advanced Industries Company. The manufacturing facility is located in Yanbu industrial city, few hours from Jeddah port. Obeikan has an installed capacity of 800 ton per day of clear float glass in a range of thickness varying from 3mm up to 15mm. The company commenced its float glass operations in February 2011. It is one of the largest manufacturing facility of its kind in the Middle East region with a capacity of 800 tons per day. Besides meeting a significant demand in the kingdom, the
company exports to more than 30 countries in Asia, Africa, America, Australia and Europe. In recent years, the architectural glass market in the Middle East has grown at an annual rate of about 4%. In particular, demand is increasing for solar control glass that can block sunlight and significantly improve the energy-saving per formance of buildings and its growth rate is estimated to exceed the market growth rate. As a result, demand for high-per formance architectural glass is projected to rise continuously in the region. “Having a float glass plant with a glass coating plant downstream from it on the same site will help us to keep tight control of quality, to optimize the production and logistics costs, and to achieve higher margins” according to Abdallah Obeikan, CEO of Obeikan Investment Group .
Lights out for Royal Philips’ facility Thailand Royal Philips, the Dutch manufacturer of electrical, medical and lighting products, will close its only fluorescentlight plant in Thailand in the coming quarter. The shutdown of the factor y at the Bangpoo Industrial Estate in Samut Prakan comes as demand for fluorescent lamps dims in markets around the world. The plant produces more than 1,000 types of fluorescent lamps. In Thailand, the company separated its lighting business from medical and electric goods in Februar y.
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The move will give its lighting operations more flexibility in managing its business and setting its growth plan. The lighting business will be under Philips Electronics (Thailand), while medical and electrical appliances will be under a new company named Philips (Thailand). The transformation aligns with the company's strategy for creating a stronger foundation for future growth and innovation to address customer needs better and faster. "Under the reshuffle, our
head office is expecting significant growth in the lighting business and the creation of a new segment of smart and connected lighting," says Chalermpong Darongsuwan, managing director of Philips Electronics (Thailand). In Thailand, the contribution of fluorescent lamps in the overall lighting market is continuing to drop, from 30 per cent last year to 28 per cent expected this year. Overall demand for electric lamps is expected to brighten by 3-4 per cent to about Bt6.1 billion
this year. LEDs have taken about 34 per cent of the market, with traditional lighting products still dominant. However, in the Bt15.3-billion luminaire market, LEDs represent about 62 per cent. The company will also focus on positioning itself as a leading provider of lighting solutions, especially in projectbased channels, such as the government's infrastructure projects and the private sector's housing and shoppingmall projects.
AG 16-3 asianglass
11
News
Sisecam sees sales boost Turkey Sisecam Group reported consolidated net sales of TL 7.4 billion and a net profit of TL 805 million for the full-year 2015. The Group's total investments reached TL 1.1 billion in the same period. Sisecam Group, a global actor in business fields including all main areas of glass industry, i.e. flat glass, glassware, glass packaging and glass fiber, as well as soda and chromium chemicals, generated a total sales revenue of around TL 7.4 billion in 2015. In the same period, Şişecam, a group with manufacturing activities in 13 countries in three continents and sales in all over the world, produced 4.2 million tons of glass, 2.2 million tons of soda and 3.6 million tons of industrial raw materials at its domestic
NEWS IN BRIEF Italian leading company Pneumofore has installed a vacuum system at Siam Glass’s Rojana plant in Thailand. The vacuum system, used in glass forming, has helped reduce the weight of bottles from 145 grams to 140 grams and means Siam Glass can produce 21,600 more bottles each day. Siam Glass runs three plants in Thailand, producing energy drink containers of varying size. The challenge for Pneumofore was to reduce the container thickness and decrease the rejection rate of 150ml bottles by the use of vacuum. Only one of the three IS lines was modified and configured as a ‘test bench’ for vacuum.The monitoring of pneumatic energies and the search of the best balance between vacuum degree and forming air gave unexpected results. The weight of glass containers with an initial weight of 145 gr was reduced to 140 gr.
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and overseas facilities. “As of the end of 2015, our consolidated net sales reached TL 7.4 billion. The share of our international sales representing the total amount of exports from Turkey and sales from overseas production was 51 percent in our consolidated sales. As a result of the increasing capacity utilization rates of the production facilities, consolidated EBITDA volume reached TL 1.7 billion as of the end of 2015,” Prof. Dr. Ahmet Kırman, Vice Chairman and Chief Executive Officer, said. Şişecam Group reported total investments of TL 1.1 billion and the Group’s international sales reached approximately USD 1.3 billion in 2015. "Our aim is to further strengthen our financial structure so that the Group continues to grow consistently
in the future. We are committed to optimizing our production facilities at an increased pace, while continuing to optimize costs through efficient methods. We are constantly evaluating the policies to be followed for sustainable and profitable growth and operational excellence, taking into consideration the general outlook of the global economy, as well as the geographical areas where we operate," Kırman noted. One of the most established enterprises in Turkey, Şişecam Group is a global actor in business fields including all main areas of glass industry, i.e. flat glass, glassware, glass packaging and glass fiber, as well as soda and chromium chemicals. Today Şişecam,
Gas regulations will support industry Indonesia The government has pledged that it would soon issue a supporting regulation that would allow certain industries to buy gas at lower prices in an effort to reduce production costs and ease price disparities in the countr y. The regulation, currently under deliberation by the Energy and Mineral Resources Ministr y, is required as a legal basis to implement Presidential Regulation No. 40/2016 on natural gas pricing that should have become effective in Januar y. The presidential regulation stipulates that the ministr y can ask gas companies to reduce their gas prices should it find them selling it at higher than US$6 per million British thermal units ( mmbtu ), especially to certain industries, specifically those producing fertilizers, petrochemicals,
oleochemicals, stainless steel, ceramics, glass and gloves. “It, however, cannot be implemented because we need to come up with a ministerial regulation to arrange how gas traders and explorers could lower their selling prices first,” the ministr y’s director for oil and gas program development, Agus Cahyono, has said. Indonesia’s gas prices currently stand at around $9 per mmbtu, still higher than its ASEAN neighbors. Malaysia, for example, sells it at around $5 per mmbtu. Gas prices also differ in various regions depending on how distant they are from gas production facilities. Gas prices in Java, for example, stand at an average of $9 per mmbtu while in North Sumatra they soar up to an average of $14 per mmbtu because of a lack of supply.
the world’s leading supplier of chromium compounds and the 10th largest soda ash producer in the world, is the 3rd largest glassware, the 4th largest glass packaging and the 5th largest flat glass manufacturer globally. The Group, which has 44 production facilities in total, has manufacturing activities in Turkey, Germany, Italy, Bulgaria, Romania, Slovakia, Hungary, Bosnia-Herzegovina, the Russian Federation, Georgia, Ukraine, Egypt and India. With its 80 years of experience, over 21,000 employees, production in 13 countries, and sales in as many as 150 countries, Şişecam is a group at international scale and continues on its journey to become one of top three global producers in its all main business fields.
NEWS IN BRIEF A contract signing ceremony has been held in Shanghai during China Glass 2016, for China National Building Materials Group Corporation (CNBM) and enterprises of Egypt’s Cairo Glass and Indonesia’s Pt Maleka on China Glass 2016. CNBM cooperated with CairoGlass on a general contract project of production lines for float glass with daily melting capacity of 250 tons and for cold reparations of cold pressed glass. CNBM cooperated with Pt Maleka on a general contract project of float glass with daily melting capacity of 500 tons. Egypt and Indonesia both are important countries along the One Belt and One Road. In general, the two newly signed contracts will lay solid foundations for expanding the markets of countries along the One Belt and One Road.
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News
New furnace at PT Asahimas Indonesia PT Ashaimas Flat Glass, Indonesian subsidiary of Japanese flat glass major, Asahi Glass Co., Ltd will commence operations of its new furnace in Cikampek area ( about 85 Kms from Jakarta) in the month of August. Asahi has invested approximately 16 billion Japanese yen to PT Asahimas Flat Glass Tbk
(AMG), one of AGC’s consolidated subsidiaries in Indonesia, to set up this state-of-the-art float glass furnace to replace a float furnace at the Jakarta plant. The new furnace is constructed adjacent to AMG’s Cikampek Plant, an automotive glass fabrication plant in Cikampek area. With an installed capacity of 210,000 TPA of float glass , the new furnace
will result in a 40% increase in the production capacity of PT Asahimas. AMG currently has two float glass furnaces each at its Jakarta Plant and Sidoarjo Plant (with total production capacity of 570,000 tons a year) for the production of float glass used for architectural and automotive applications.
Glass production from the new furnace is intended to achieve a competitive production framework to meet the growing demand in the region. Also, the enhanced production will help AMG to accommodate the latest changes in Jakarta city master plan, which will change the existing industrial area to become commercial use in the near future.
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Glass packagers unite in recycling drive UNITED STATES The Glass Packaging Institute (GPI), along with beverage leaders including Diageo and New Belgium Brewing, and the glass processing and recycling industry, have convened a dynamic group of organizations to make glass recycling work in the U.S. The nearly two dozen member organizations announced today they are joining forces to create the U.S. Glass Recycling Coalition. The coalition's primary goal is to help build a foundation to make glass recycling a successful industry, and an efficient, highquality and convenient service consumers want and expect. An extraordinary aspect of this coalition is the fact that it involves membership and collaboration across the entire glass supply chain. For the first time ever, organizations, including consumer brands, glass manufacturers, waste haulers, recycling processors, and trade organizations involved within many of these industries, will work toward this common goal. Glass containers for food and beverages are 100 percent recyclable, but today the U.S. recycling system faces a perfect storm of economic forces that is making it harder to recycle glass.
Glass recycling can pose unique challenges on the recycling infrastructure if not planned for and executed correctly. In addition, a few municipalities have decided to remove glass from their curbside recycling programs and send it to disposal instead. This trend is not only environmentally harmful, but also serves to disengage and confuse the public on recycling. "The Glass Packaging Institute is excited to partner with stakeholders along the entire value chain to work together on practical and targeted solutions for returning more recycled glass back to manufacturers for new bottles and jars," said Lynn Bragg, President of GPI. "For glass container and fiberglass manufacturers, the demand for recycled glass dramatically exceeds the supply." Making Glass Recycling Work Coalition members intend to work on bringing best practices to the U.S. glass recycling supply chain to increase the availability of "cullet," the industry term for furnace-ready recycled glass that can become new bottles and jars, as well as fiberglass. For companies like Diageo and New Belgium Brewing, glass
is not being recycled at a high enough rate to meet the beverage makers' needs for recycled glass to make new bottles. "Diageo is committed to sustainable packaging for our products, and we have significant global ambitions to increase the recycled content in our packaging," explained Roberta Barbieri, Global Environmental Director, Diageo. "We are keen to see an increase in glass recycling in the U.S., and so we decided to come together with our beverage industry peers and representatives from across the entire glass recycling ecosystem to begin to identify solutions." "At New Belgium, we are always looking at how we can honor the environment in our business decisions and recycling is a key part of that," said Katie Wallace, New Belgium's Assistant Director of Sustaniability. "We know the glass recycling industry is facing significant challenges and believe that consumer-facing brands are an important part of a collaborative, nation-wide solution. We look forward to all that lies ahead and are honored to be part of this process." The coalition aims to help create an efficient system for
glass recycling, making it a viable option for everyone. Together, the coalition will work to develop strategies to assist municipalities with glass recycling decisions, and establish a network of glass recycling resources and champions. The coalition met on April 21, 2016 for an inaugural session hosted by GPI in Washington D.C. At launch, the Coalition already has the support of leading industry players. Confirmed members of the coalition include: • Allagash Brewing Company • Ardagh Group • Diageo (cofounder) • Gallo Glass Company • Glass Packaging Institute (cofounder) • Goose Island Beer Company • Heineken USA • NAIMA (North American Insulation Manufacturing Association, Inc.) • New Belgium Brewing (co-founder) • National Waste and Recycling Association (NWRA) • O-I • Pratt Industries • The Recycling Partnership • Resource Recycling Systems (facilitator) • Republic Services • Ripple Glass Making Glass Recycling Work • Rocky Mountain Bottle Company • Sierra Nevada Brewing Co. • Sims Municipal Recycling • Strategic Materials, Inc. Waste Management
Pilkington to invest in furnace upgrade UNITED STATES Pilkington North America Inc. has announced a $40 million investment planned for its float glass plant. The project involves repairs and re-bricking of its oxy-fuel furnace. “This investment is part of our ongoing commitment to the Rossford community and to our customers,” said Dick Altman, regional director, Architectural Glass North America. The Rossford plant opened in 1899, first as Libbey-Owens-Ford, and the community itself was founded by glass pioneer Edward Ford. The plant manufactures float glass and fabricated automotive glass products and has around 400 employees.
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According to Todd Huffman, the float plant manager at the site, the company wants to replace an existing gas line which provides natural gas to fire its two furnaces. “Those gas lines have been in place since the early 1960s. As you can imagine, they are showing their age,” Huffman said. As the gas needs will be cut in half during the repair of the one furnace, this is the ideal time to replace the gas line as another line can handle the demand during the replacement of the line. “We have estimated on our cost on the whole project as $30 to 45 million so we are using the $40 million estimate for the cost of the total project,” Huffman said.
Recently, Rossford Council unanimously passed an ordinance to approve an agreement allowing Pilkington to use part of the property at the landfill site as a staging area for replacing the gas line. Huffman was at the meeting and clarified a couple of points for council before the vote. The gas line will not cross the landfill property but runs alongside it. Using the city property to stage the pieces for the project is the most effective. Huffman explained the need to have the right angle and depth for a directional bore to replace the line. They will work to cross under the railroad near Beech Street and Wales Road. The project is scheduled to begin
in early June and is expected to be completed by mid-September. Prior to the vote, Administrator Mike Scott and Councilman Jerry Staczek both said the agreement with Pilkington was “extremely onesided.” It is designed to protect the city from liability and strongly favors the city. “And Pilkington has agreed to it,” both Scott and Staczek said at different points in time. Pieces of the piping will be laid out and assembled in the staging area before being put into place. Huffman said it was important to pair the gas line replacement with the furnace improvements as it could not be done at any other time.
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Parliament commits to packaging boost EUROPE The European Parliament’s Committee on Environment, Public Health and Food Safety (ENVI) has committed to work on the challenges of safety and recyclability of food packaging, following a meeting in early May in the European Parliament. A tighter convergence of objectives and a stronger legal coherence between the safety of Food Contact Materials and the principles of the circular economy were the subjects being discussed in the European Parliament at a lunch co-hosted by MEPs Birgit Collin-Langen (EPP, DE) and Christel Schaldemose (S&D, DK). The increase of waste recycling in the future EU Circular Economy must also ensure increased safety of food contact materials, those in attendance agreed. In a communication on the meeting, FEVE (the Federation of European manufacturers of glass containers) explained that food
contact materials and articles are today covered by the EU Framework Regulation (EC) No 1935/2004, which establishes general safety requirements and identifies 17 groups of materials and articles that may be subject to harmonised measures. In the absence of the specific rules for non-harmonised groups of materials and articles the possibility remains for Member States to adopt national provisions. Thus, diverse national interpretation results in additional market obstacles, loss of competitiveness, and difficult access to the market for business operators. The draft report on the implementation of the Food Contact Materials Regulation has been recently published by its Rapporteur MEP Schaldemose in the ENVI Committee. It calls for further harmonisation at EU level for non-harmonised materials
through specific measures based on scientific evidence, better risk assessment, and traceability and monitoring of compliance with legislation. “The EU Framework Regulation constitutes a solid legal basis, and its objectives remain relevant”, commented MEP Schaldemose, “but this is no longer enough to guarantee the safety of recycled materials which can potentially contain substances dangerous for consumers’ health. It is really great we can work on this topic together”. A more harmonised Food Contact Material legislation which takes account of the Circular Economy challenges will also give better market access to those materials which do not contain chemicals, are safely recycled in clean and simple streams and can guarantee consumer safety because of their inherent properties.
“We are now working at these challenges in the ENVI Committee. Safety and recyclability of food packaging needs to be addressed simultaneously and urgently”, warned MEP CollinLangen, Shadow Rapporteur on the Report, “only then will we be able to guarantee a high level of health protection for EU citizens and minimize the impacts on the environment”. The Secretary-General of the European Container Glass Federation (FEVE), which collaborated in the organisation of the MEP debate remarked that “it is important we have harmonised EU legislation for all food packaging materials to get rid of any internal market barriers to the circulation of safe recycled packaging. The use of permanent materials like glass should be encouraged: they do not lose their safety properties no matter how many times they are recycled”.
Fenzi invests in Tecglass for digital printing Spain The Fenzi Partecipazioni holding company has decided to invest in digital glass processing technologies by buying into the capital of Tecglass, the Spanish producer of very high-tech digital glass printing machinery and components. This strengthens the working partnership of the two leading companies, which have already been working together for some time, and demonstrates the interest of Fenzi in innovations applied to glass while significantly increasing the growth potential of Tecglass on the international marketplace. Established in 2002 by a group of experts who had a good deal of experience and know-how in this industrial sector, Tecglass has recently studied, developed and produced a range of digital printing machinery specifically for the glass industry. The technology takes the place of traditional decorating methods and offers a simple, efficient tool for applying graphic motifs and photographs directly on
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glass: ceramic inks can be used on glass for indoor or outdoor use, on sheets of any size (from a minimum of 380x380 mm. to a maximum of 3,300x18,000 mm), with a solution for any type of sector and application. The sophisticated Tecglass technology fits in perfectly with Fenzi’s strategic vision and natural propensity for innovation which, a company whose financial strength, managerial skills and international sales network, can make the most of the considerable opportunities offered by what is a currently very promising market. Companies and experts having an interest in this particular glass processing method will now have a new mix of services and products that meet the needs of designers, architects and developers both in terms of aesthetic results and manufacturing capability: Tecglass digital technology is now closer to glass processing companies worldwide and can count on the professionalism
and solidity that have set the Fenzi Group apart for more than 75 years. Alessandro Fenzi, CEO of the Fenzi group, expressed his satisfaction with the new partnership: “A big welcome to Tecglass in our group; after following the innovative technology developed by Tecglass with great interest for many years, I am enthusiastic about the results that can be achieved by offering Tecglass the financial solidity and commercial strength of our group. Our holding is always looking for innovative developments in the glass industry and Tecglass is an investment opportunity that is in line with our research criteria”. The same enthusiasm was expressed by Javier Fernandez, one of the two founding partners of Tecglass: “My partner Manuel Ramos and I are very happy to join the Fenzi group. We started working with Fenzi many years ago and for
some time now Tecglass has been successfully distributing Fenzi products in Spain. We have recently developed a range of leading-edge digital printers and an alliance with a strong partner such as the Fenzi group is what Tecglass needs at this time to convert its technological leadership into a market leadership”.
Asian Glass: now for mobiles, ipads and androids
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The RAPIDLINE Series of Equipment can be configured with a nested floor loader as shown or a gantry loading system. Additional options include both fixed and compact storage options to add multiple glass positions within the same bay or adjoing bay to maximize the layout in the available space. Storage area can also be zoned/configured to allow continuous production while restocking locations within the storage system.
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People and Places Heye International announces new Sales Director Germany With effect from April 1, 2016, Heye announces the appointment of Jens Langer as Director Sales & Marketing. Since many years, Jens Langer has gained extensive experience as international Sales & Marketing Director as well as Head of Project Management in the mechanical engineering industr y. Now he will share his knowledge with Heye International to keep and develop the company’s growth strategy.
China Glass ends on a high China On April 14, The 27th China International Glass Industrial Technical Exhibition (China Glass 2016), organized by Chinese Ceramic Society and contracted by Beijing Zhonggui Exhibition Co., Ltd. was brought to a successful conclusion. The exhibition took place in seven halls of the exhibition center and has an exhibition area up to 80,500 square meters. 886 companies from 31 countries attended the show, including 656 domestic companies and 230 foreign enterprises. As the second largest glass exhibition in the world, China Glass 2016 attracted 22560 visitors from 65 countries during the exhibition, of which 13% are from overseas. There were several visiting delegations with more than 600 visitors from foreign countries attending this event, including the South Korean delegation (325 members), India Glass Bulletin magazine delegation (100 members), Vietnam glass industry delegation (90 members), Mexico tempering glass delegation, and Iran safety glass delegation. Many distinguished guests at home and abroad were present at the event, including Mr. Xu Yongmo, President of Chinese Ceramic Society, Mr Zhang Renwei, Honorary President of Chinese Ceramic Society, Mr
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Chen Guoqing, Deputy President of China Building Materials Federation, Ms. Yao Yan, Deputy President of Chinese Ceramic Society, Mr. Peng Shou, Deputy President of Chinese Ceramic Society, Mr. Jin Zhanpin, Deputy President and Secretary-General of Chinese Ceramic Society, Mr. Meng Lingyan, President of China National Association for Glass Industry, Mr. Zhang Baiheng, Secretary-General of China Architectural and Industrial Glass Association, and heads of related organizations from Italy, German, USA, etc. This exhibition covers various areas of glass production, including new energy-saving building glass, ultra-thin function glass, electronic glass, special glass as well as glass processing equipment, glass testing instrument, new types of abrasive and abrasive tools. Meanwhile, automatic production lines for glass, robot for glass production, art glass were the highlights of this glass show. The week event attracted leading manufacturers and companies of glass industry worldwide, both famous transnational enterprises and middle and small-sized emerging companies made a stage pose at China Glass 2016. This exhibition set 3 national pavilions at Hall W1 and Hall W2, which
A brand new website for TIAMA France TIAMA has announced the inauguration of its newly designed website. The company can now be visited on its new address: www. tiama.com In what is a technologydriven world, the necessity to have a functional, responsive and dynamic website is now undeniable. Accordingly, TIAMA, a major player in supplying inspection and quality controls solutions for glass packaging renewed its website with an uncluttered design, new relevant webpages, entertaining videos, modern animations and pertinent data. The design of the web pages and the structure of information have been changed to improve overview and usability. The new look and colors now reflect the general TIAMA image and
colour coding of ALL our five business areas. “We wanted to make the new website faster, easier to navigate, and more user-friendly. As a technology leader, it’s important for us to make information regarding products, services and trends, easily accessible for all our visitors” explains Ursula Baudry, the Marketing & Communication manager at TIAMA. TIAMA initiated a new window display to support its brand via a responsive website format that is equally available on different platforms such as PC, tablet or smartphone. There are still “log in-protected customer areas” which allow customers to enter the on-line catalogs dedicated to spareparts and kit & upgrades. One can subscribe to the regular TIAMA e-newsletter.
were organized by ICE Italy, GIMAV-VITRUM, BMWI, VDMA and Dame Associates Inc. from Italy, Germany and the United States. Several companies from Portugal and Bulgaria were participating in the event for the first time. It reflects the prospects and more attentions from foreign enterprises to China’s glass industry. The event featured a high-profile conference – The 24th International Congress on Glass, with more than 800 attendees from 33 countries, which was held the second time in China after 21 years. It provided a valuable opportunity for glass scientists and technologists to exchange the latest progress and achievements, and also indicated the future trends of glass research and development. The topics of this congress included research, development of technology, education, and publication of the glass field. During the exhibition, 4 foreign enterprises and 8 domestic companies held 14 seminars and new product presentation meetings, They had extensive discussion and exchanges on such topics as new type glass testing instruments, glass for new energy materials, new breakthroughs in vacuum
insulated glass, new refractory materials for glass furnaces, melting-heat oxy-feul combustion, new process of art glass, and newest technology and whole equipment for glass container production. They reflected segment’s development and requirements to the energy saving and the emission reduction, and explained the combination of humanity art with glass science and technology, and represented the new trend of robot in the glass production field. The year 2016 marks the start of the Thirteenth FiveYear Plan of China. The glass industry is currently confronting multiple pressures including excess capacity of traditional products, slow development of new technical products, structural contradiction between supply and demand. Meanwhile, owing to a series of important measures and initiatives of the county in the new normal, including the “One Belt and One Road” strategy, development of the Beijing-Tianjin-Hebei Region and the Yangtze Economic Belt, and the “Made in China 2025” strategy, China’s glass industry will greatly quicken its pace in industrial adjustment, transform and upgrading.
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Batch Prices subdued as market softens China // Soda Ash According to ICIS, Soda ash price discussions in Asia are softening, as supply improved in the key China market while demand from downstream sectors remained weak, industry sources reported in the second week of May. Selling interests surfaced at lower numbers from China during the month, market sources said. For dense grade Hou-process material shipping at the end of May, an offer was quoted at $195/tonne FOB (free on board) China. For Solvay-process dense grade soda ash, suppliers reduced their offers by $5/tonne from the previous week, but deemed levels below $200-210/tonne FOB China as unworkable in the current market. China is a major exporter of
soda ash in the region. It shipped out almost 2.2m tonnes of the material in 2015, based on official data. The material is produced in the country either through the Hou or Solvay process technologies. Depending on the technology used, the soda ash produced will yield different by-products. This week, a major importer limited its buying indication at below $190/tonne FOB China, as higher numbers would not be viable given firming freight rates. It typically buys 3,000 to 4,000 tonnes of monthly soda ash volumes from China for the East European market. No deals were heard concluded as the buyer opted to wait for further offer options before placing orders.
On 4 May, dense grade soda ash prices were assessed at $205-215/tonne FOB China, down by $2-10/tonne from the previous week, according to ICIS data. Availability of soda ash cargoes from China had been scarce but the tight supply eased in late April with the restart of a 1.8m tonne/year plant in Shandong after a prolonged shutdown from 1 February. Soda ash prices had been on an uptrend since the start of the year until early March, when a correction ensued. They have come off by about 10% since the peak on 2 March, attracting some buyers back to the market. “We had discussions with several major suppliers because some of them started contacting
us first - quite a game-changing nuance, I believe – [that has not] happened for a long time,” said a buyer for the European market. “Some of the suppliers are saying local [Chinese] demand is really weak so they are more open to flexible pricing,” the buyer said. A major China-based producer said prices may remain under downward pressure this month before stabilising in June on account of reduced output. Lian Yun Gang Soda Industry is operating its 1.3m tonne/ year plant at Lianyungang city in Jiangsu province this week at a reduced rate of 70%, down from 90-95% previously. The plant is slated to operate at below 50% in June to facilitate plant modification works, according to a company official.
Solvay mothballs output over energy concerns softens Egypt // Soda Ash Solvay is to suspend until further notice the production of soda ash at its plant in Alexandria, Egypt, as sharply higher energy costs have undermined the plant’s profitability. Customers will be served from Solvay’s other soda ash plants. Production of quicklime will continue at the Alexandria site, with good prospects in the region including in construction. Quicklime, also known as calcium oxide, is used in steel, pulp and paper and gold mining. Solvay aims to minimize the impact of this temporary decision on its employees. Measures include seeking alternative uses
for this conveniently located industrial platform. The decision to mothball production will result in an asset impairment of about € 90 million, after tax, to be booked in Solvay's first-quarter 2016 results. The soda ash plant’s profitability has been declining since 2014 when a gas price increase of 2.5 times outweighed Solvay’s continuous efforts to improve production performance through lower energy consumption and increased operational efficiency. An international chemical and advanced materials company, Solvay assists its customers in innovating, developing and
delivering high-value, sustainable products and solutions which consume less energy and reduce CO2 emissions, optimize the use of resources and improve the quality of life. Solvay serves diversified global end markets, including automotive and aerospace, consumer goods and healthcare, energy and environment, electricity and electronics, building and construction as well as industrial applications. Solvay is headquartered in Brussels with about 30,900 employees spread across 53 countries. It generated pro forma net sales of € 12.4 bn in 2015, with 90% made
from activities where it ranks among the world’s top 3 players. Solvay SA (SOLB.BE) is listed on Euronext in Brussels and Paris (Bloomberg: SOLB:BB - Reuters: SOLB.BR). Solvay’s Soda Ash & Derivatives Global Business Unit is a world leader in its sector, producing soda ash serving the glass, detergent and chemical markets and developing solutions based on sodium bicarbonate and trona serving the healthcare, food, animal feed, and flue gas cleaning markets. SA&D has 12 industrial sites worldwide, more than 3,500 employees and serves 90 countries.
concerned about Unilever’s failure to follow strict conditions around maintaining equipment. “Soda ash can pose a risk if it does enter the environment so it’s vital that companies adhere to their licence requirements.” In addition to issuing Unilever with a $15,000 fine, the EPA also issued the company with an official clean up notice. “A follow up inspection by
EPA officers on 21 April 2016 revealed that more soda ash had leaked onto the ground – this is despite Unilever advising us the area was clean,” said Sheehy. The soda ash has since been cleaned up and Unilever has taken steps to prevent further soda ash leaks by having spare parts on hand for future repairs, according to the company.
Unilever fined over leak Australia // Soda Ash The NSW Environment Protection Authority (EPA) has fined Unilever Australia $15,000 after soda ash leaked from a silo at the company’s North Rocks premises. The leak, which was first discovered during an EPA inspection on 15 April 2016, was caused by a faulty valve on the silo. EPA Acting Director Metro Greg Sheehy
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said EPA officers observed the soda ash leaking onto the ground, entering two onsite stormwater drains (which lead to an onsite holding pond) and becoming airborne. “The EPA’s assessment is that the risk of offsite impacts in the community is very low because soda ash did not leave the premises,” said Sheehy. “However the EPA is
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Palletizers for glass bottles and jars Case/Crate packers and palletizers and conveyors Robotic palletizers HMI to control all your cold-end / packing lines Tray formers Shuttle trolleys Pallet dressing lines Accumulation tables Lehr de-stackers Vibrating plates for lehr discharge Pressureless aligner Merry-go-round tables Belt transfer and spacing devices Orientators for non-round containers Cullet conveyors Rubber slat elevators, lowerators, overturners
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Fuyao: pursuing and catching the American dream… N
early every month Cho Tak Wong is chauffeured to his local airport in Fujian Province, boards his private jet and takes a 14-hour flight to the U.S. At a former General Motors car factory in Dayton, Ohio he’s putting the finishing touches on what he says will be the world’s largest facility for making automotive glass. Production began in December; by the end of the year more than 2,000 workers will be making car windows and sunroofs. Cho started Fuyao Glass in 1987, and it’s made him a billionaire, but now it’s spending $600 million to do something it’s never tried before–manufacture in the tough North American market, where virtually every major automaker now operates a factory. “We have to set up plants overseas to serve overseas markets, to save on tariffs and transportation fees,” he says in Mandarin (he doesn’t know English). “We follow in the footsteps of our clients.” Indeed, Fuyao must open factories abroad, since it’s already seized more than 65% of the market in China. That puts it in a global dogfight. Decades of consolidation in the industry have concentrated automotive-glass production in four big players that have won more than 70% of the automakers’ business worldwide. With a roughly 20% share, Fuyao narrowly trails the industry’s long-reigning king, Japan’s Asahi Glass, in the volume of automotive glass sold and narrowly leads Japan’s Nippon Sheet Glass. “Fuyao is doing the right thing,” says Ken Long, a glass specialist at the market researcher Freedonia Group in Cleveland. The North American market is a smart choice: Worldwide auto production is expected to grow by only 2% a year over the next five years but by 3.8% in North America, with the biggest gains coming in Mexico, says Long. Cho calculates that in Ohio production costs will stay at the level he now spends on making and shipping the glass sheets from Fuyao’s factories in China, given the lower energy prices, savings from transportation
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and tariffs, and higher worker productivity in the U.S. The industry requires huge outlays–for heavy capital investments, prodigious energy use and expensive safety standards. But Fuyao now has the heft to compete for market share outside of China: Its revenue is expected to reach close to $2.5 billion this year–a 14% increase over 2015–and net profits are set to hit $460 million, an 11% rise over last year, according to a consensus of estimates compiled by Bloomberg. It consistently enjoys greater profit margins than Asahi. Cho says that’s because it focuses on only one product. “I am just a specialist on automotive glass. We devote all our energy to this industry: the management, the factory, the production, everything. We are definitely better than our competitors.” His rivals may beg to differ, but either way, making windows for cars, trucks and buses has been lucrative. He owns 17.4% of Fuyao, and FORBES ASIA estimates his net worth at $1.5 billion. “I entered the glass business not because of any passion about driving,” he says. “Glass is not just a car part but also a decorative item. If you don’t make it look good, it affects a car’s appearance. But first it has to be of high quality, then the looks.” Automotive glass has always been a complicated business: In its nearly 30 years Fuyao has produced more than 100,000 variations–given that cars typically contain seven windows, if there’s a sunroof, and each car model is different. But while today’s technology results in smarter and sexier automotive glass, it adds to the complexity. Increasingly, the most expensive vehicles are fitted with panoramic, less-reflective windshields that are also, in effect, antennas. The windows come with water-repellent coating and protection against ultraviolet rays. Just by touching them the tint can be adjusted if it’s too bright or too dark outside. Roughly 30% of the company’s revenue comes from sales of premium glass, helping to keep margins high.
Specialization has reached the point where Fuyao works with premier customers on individual innovations, such as with Land Rover to develop invisible heating wires so windshields and side windows can be defrosted and not just rear windows, where the wires can be seen but visibility is less important. The new windows, aimed at northern European vehicle buyers, hit the market a year ahead of competitors, says Joseph Wong, an analyst at Nomura” in Hong Kong. Growing up poor in Fuqing City, he was kicked out of school at age 8 for playing pranks on teachers and missing too many classes. In between tending the family’s farm and cattle, he taught himself by reading dictionaries and other books passed along by his elder brother. His first job was peddling cigarettes on the street with his father at a time when China banned people from trading goods for themselves. He later worked as a foodpurchaser at a state-owned farm and then as a salesman for a local-government construction unit. Only when he was 30–in the year Mao died–did he find a path to a sustained career. A friend outlined the business potential of the glass that goes into household water meters as more homes were being connected to a water supply. He persuaded local officials in Gaoshan, his home county, to set up a rudimentary factory that he would run. Cho battled endless adversaries– stubborn and scheming officials, stifling bureaucracy, unhelpful government rules and standards–while steering the business to profitability and upgrading the production facilities. His role under his unusual arrangement with the local government evolved from manager of the glass factory to contractor, coinvestor and finally controlling shareholder. After 11 years he started Fuyao to invest in automotive-glass production. This was back when Chinese car owners drove around with broken windows because the only replacements available were foreign and expensive.
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ANALYSIS: Container glass
drugs industry drives packaging growth Yogender Malik looks at how developments in pharmaceutical packaging are proving a boon for container manufacturers in some of the continent’s most dynamic regions.
C
osts, efficiency, regulatory scrutiny and other factors have put the pharmaceutical industry under pressure in recent years. Packaging plays a very important role in overall scheme of things in the industry. Traditional forms of packaging are undergoing a major transformation in the pharma industry, Asian countries, where the pharma sector is undergoing most rapid changes due to increasing demand are facing a unique challenge visà-vis packaging. Glass containers and industry, which plays a critical role in pharma packaging are undergoing a rapid change. Specilaised pharma glass producers are fast emerging and have cornered a large share of the market. At the end of 2014, total pharmaceutical packaging demand in Asian countries stood at USD 19 billion. Propelled by huge spending on pharma sector in developed economies of Japan and China on the one hand and significant demand from developing countries such as India, Indonesia, Thailand and Vietnam on the other hand, pharmaceutical packaging is expected to one of the key factors behind the growth of packaging industry. Countries like India and China are experiencing the fastest product demand growth from rapidly expanding pharmaceutical manufacturing capabilities, burgeoning drug exports, and the phasing-in of an extensive government program designed to upgrade the quality and integrity of nationally produced medicines.
Outlook for glass
For a large number of pharmaceuticals, including medicinal products for oral and local administration, glass containers are usually the first choice (e.g. bottles for tablets, injection syringes for unit- or multi dose administration.
India
Accounting for 11 % of total container glass industry of the country, pharma
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asianglass AG 16-3
Production, consumption and exports of pharma container glass in India Year
Production
Consumption
Exports
2015
341,000
320,000
27,000
2014
327,000
302,000
25,500
2013
304,000
289,000
22,000
2012
295,000
271,000
21,000
2011
288,000
264,000
19,000
glass sub-segment is exhibiting a strong growth in last few years. With a consumption of about 320,000 tons of container glass in 2015, pharma sub-segment has become one of the top priorities for container glass due to its rapid growth in past few years. Hindustan National Glass Industries, AGI Glasspac, Piramal Glass, the top three container glass producers have dedicated significant resources of their total production capacity towards pharma glass production. Besides, the big three there are a number of dedicated pharma container glass producer, some of which have commenced operations in last five years in order to reap benefits of burgeoning container glass demand from the pharma sub-segment. In 2014, Cogent Glass inaugurated its Rs 200-crore new manufacturing plant in Telangana’s Mahabubnagar district. The facility has production capacity of one million pieces per day for Type I moulded vials and half million pieces for tubular containers. According to India’s largest container glass producer, HNGL’s Managing Director, Mukul Somany, “The Indian Pharma market is currently growing at CAGR of 18-20%.”
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ANALYSIS: Container glass
THE INDIAN PHARMA MARKET IS CURRENTLY GROWING AT CAGR OF 18-20%
Dedicated pharma suppliers
Importance of pharma sub-segment for Indian container glass industry could be understood by the quantum of investment by domestic and international glass producers in recent years. German company, Schott has upgraded and added capacity at its Indian operations in last few years. The company is present in India since 1998 when the it took over a domestic company producing pharmaceutical tubing in Jambusar, Gujarat. This plant now functions as a production hub for company’s pharmaceutical tubing for Asia. Today, Schott through its 100% subsidiary in India has one manufacturing site in Gujarat and sales offices in Mumbai and Pune. To provide the Indian pharmaceutical industry with high quality tubing, the company has completely modernized the production technology to German standards and also expanded its production capacity. In 2005, the company installed a new tank to produce fiolax tubing on site. Two years later, a further high technology tank was set up for additional production of pharmaceutical tubing. Schott Kaisha, a joint venture between Indian company Kaisha and German
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asianglass AG 16-3
Major Pharma Glass Producers in India Company
Country
Location
Installed Capacity
HNGL
India
Multiple
4450 TPD
AGI Glasspac
India
Telengana
1550 TPD
Piramal Glass
India
Kosamba
860 TPD
Haldyn Glass
India
Gujarat
320 TPD
Janta Glass
India
Gujarat
220 TPD
Pragati Glass
India
Gujarat
130 TPD
Cogent Glass
India
Mehbubnagar
1.5 million/ day
Schott Kaisha
India
Gujarat
2.4 billion/ year
Gerresheimer AG
India
Gujarat
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ANALYSIS: Container glass
company Schott is country’s largest pharmaceutical tubing producer. With its two manufacturing facilities located in Daman and Jambusar in Gujarat, the company has an installed capacity to produce 2.4 billion pieces per year. Schott Kaisha’s Jambusar plant commenced operations in early 2013. It was India’s first fully automated pharmaceutical packaging plant. This Greenfield facility, set up with an initial investment of 20 million Euros, enabled Schott Kaisha to increase its production capacity by almost 50 percent to around 2.4 billion pieces per year. The facility is housed in an area of 20 acres with ample room to construct additional production modules in parallel with the increasing demand of customers. According to Kairus Dadachanji, Managing Director of Schott Kaisha, ,”We have been supplying packaging vials and ampoules to the majority of the Indian vaccine industry, including companies like Serum Institute of India, Zydus Cadila, Bharat Biotech, Panacea Biotec, Shantha Biotechnics, GSK, Chiron and more. Almost 8090% of the vaccines that are manufactured in India are packaged in Schott Kaisha glass. It is a matter of great honour for us we play a role in the vaccination of millions of children worldwide.’ German pharma packaging major, Gerresheimer AG entered in Indian market by acquiring a Gujarat based, Neutral Glass & Allied Industries in 2012. Incorporated in 1986, Neutral Glass & Allied Industries Private Limited manufactures Type-1 and Type-3 glass bottles and vials for the pharmaceutical industry at Kosamba in Gujarat and can produce about 800 million bottles annually for type I & III pharmaceutical applications in amber and flint colours. According to Gerresheimer, Indian acquisition was meant to give the company acquisition a modern pharma glass production facility in India. Commenting on the acquisition, Gerresheimer CEO, Uwe Roehrhoff said: “We are investing in India at a time when its pharma sector is gaining international significance on the back of sustained high growth rates. This acquisition significantly broadens our production facilities, customer base and our distribution capabilities there.” Cogent Glass Ltd’s production facility is located, at village Vemula in Mahbubnagar district; spread over 40 acres, near to Hyderabad. The facility is strategically located on Hyderabad – Bangalore highway, near source of quartz sand and in the pharma hub of India offering natural advantages. Cogent has state of art glass manufacturing facility for TYPE I moulded vials, with production capacity of 1.0 million pieces per day and tubular containers 0.5 million pieces per day, focusing only on serving pharmaceutical industry
The ban that never came
Last year in October, Indian government set up a high-level committee to look into a ban on the use of PET in pharmaceutical packaging. The committee was set up after a government-authorized agency tested some PET bottles and found high levels of toxic materials. The story goes back to early 2013 when an NGO that works in the health sector, approached the ministry of health seeking a ban on the use of PET for pharmaceutical packaging. There have been several announcements and intentions from different authorities, but no final decision. In November 2013, DTAB recommended a phasing out of PET bottles for pharma packaging over a period of six months. In the first phase, it suggested there should be a ban on the use of PET to package liquid oral formulations for paediatric and geriatric use, as well as for drugs used by pregnant women. However, following strong resistance from PET manufacturers, a draft notification by the ministry of health prohibiting the use of PET for packaging was put on hold in September 2014. While, pharma producers are not very happy on this development as such a move would add to their total cost, but, country’s container glass producers are optimistically looking for such ban. Arun Kumar Dukkipati, senior vice-president of All India Glass Manufacturers’ Federation, says, “For PET, leaching characteristics are higher. If glass is used as an alternative, it will require five or six times of glass per tonne of PET. If a ban on PET for pharma comes into effect, glass manufacturers will see an increase of 25-30% in business.” Though, glass containers demand has registered a steady growth, however there are a number of sub-segments in the pharma industry, which have shifted from glass to PET. With a partial ban on PET packaging in some segments, glass industry
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asianglass AG 16-3
is expected to make significant gains in terms of total tonnage. According to Sanjay Trivedi of Surat based Sunrise Glass, “The glass industry is fully prepared to cater to any additional requirements of glass containers for pharma usage in case of a ban. We have already received indications from major brands about their desire to shift to glass packing mode and are ready for the same.”
Major Pharma Glass producers in the Middle East Company
Country
Location
Installed Capacity
RAK Ghani LLC
UAE
Ras Al Khaima
44,000 TPA
National Company for Glass Industries
Saudi Arabia
Riyadh
66,000 TPA
Mofid Pharmaceutical Glass
Iran
Tehran
66,000 TPA
Daroo Shishe
Iran
Tehran
250 TPD
Razi Glass Group
Iran
Qazvin
170 TPD
The Middle East
Higher disposable income, rising affluence and increased awareness to healthcare has made the Middle East Asia one of the top spenders on healthcare segment. In absence of leading consuming sub-segment of container glass, alcoholic beverages, pharma glass assumes more significance for container glass producers. No wonders, you have a number of dedicated pharma container glass producers in the region. Iran, Saudi Arabia and UAE, all the three major countries and market in the region have one or more dedicated pharma glass producer in their countries.
United Arab Emirates
Owning to high standards of healthcare in the Emirates, UAE is one of the strongest production base of pharma glass production in the region. The Emirates is house to the largest and most modern pharma glass production plant in the region. RAK Ghani Glass with an annual production capacity of 44,000 tonnes, which is equivalent to 600 million lightweight pharmaceutical bottles is one of the leading pharma glass producers in the region. The company which commenced commercial production in 2010 was set up to cater to surging demand of pharma glass in the region. According to Imtiaz Ahmad Khan, chief executive officer of Ghani Group, “The RAK Ghani Glass plant is the most technologically advanced facility of its kind in the region and is one of the leading pharmaceutical glass packaging manufacturers globally. The company delivers European-quality lightweight pharmaceutical glass containers and leverages the superb infrastructure, modern transportation network and seamless connectivity available in RAK.” He further adds that RAK Ghani Glass plant is the only glass plant in the Middle East and North Africa (Mena) region with a Class 100,000 Clean Room facility which enables it to meet the stringent quality standards of major pharma companies worldwide.
Iran
The brightest spot in the Middle Eastern container glass industry in Iran is expected to see a lot of action in pharma sub-segment in coming days. Currently, the sub- segment accounts for about 28 % of total container glass consumed in the country. There are three dedicated pharma container glass producers in the country. Besides, meeting most of domestic pharma container glass needs, the country is one of the leading exporters of pharma glass to Iraq, Afghanistan and
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ANALYSIS: Container glass
rest of the Middle Eastern countries. With the lifting up of sanctions, it is expected there would be an increased focus on the pharma segment, resulting in an increased demand of container glass from this sub-segment. One of the leading dedicated container glass producers in the country, Mofid Pharmaceutical Glass commenced production in 1994 as a non- profit organization. The company has emerged one of the most technologically advanced and largest container glass producers in Iran. Set up as a small container glass manufacturing unit with a meager capacity of 50 TPD of pharma glass, Mofid Pharma Glass has gone to add 240 TPD of container glass production capacity in intervening years. In order to cater to rising container glass demand from pharma sub-segment, the company has undergone four major revamping exercises ( 1998, 2004, 2010 and 2012) and currently operates two furnaces, which feeds six production lines to produce container glass for pharmaceutical industries. Another dedicated pharma glass producer in the country, Razi Pharmaceuticals Glass is a twenty three year old company. Located at Takestan Industrial park in Qazvin, the company has an installed capacity of 50 TPD produces glass container for pharmaceutical industry.
Saudi Arabia
Kingdom of Saudi Arabia has emerged as a key hub of pharma producers in recent years, which has made the Kingdom a large consumer of container glass. Though, there is no dedicated container glass producer in the country, yet, all the three container glass producers produce for pharma sub-segment in varying degrees. Container glass industry in the kingdom has got further boost on account of Saudi government’s top economic priority towards building a vibrant life sciences industry in the country. Particularly, King Abdullah Economic City (KAEC) has attracted the notice of big pharma companies in recent years, which has had a positive effect on container glass consumption. Increased focus by the Kingdom on non-oil segments of industry in the backdrop of historical fall in oil prices is expected to give a much needed boost to pharma companies in the kingdom and indirectly container glass manufacturing.
Indonesia
Largest populated country in the South East Asian region, Indonesia was considered as a laggard in the healthcare segment till the turn of the century. However spending on the healthcare segment has by manifolds in last decade, resulting in a steady growth of country’s pharma glass demand and production. Promotion of social security systems for 240 million people since 2014 has further boosted the demand for pharmaceutical products and pharma glass in Indonesia. According to the Indonesian Packaging Federation (FPI) the pharmaceutical industry is of overwhelming importance for Indonesia’s packaging market, second only to the food and beverage industry. Noting the sheer size of this sector, hi-quality, sophisticated packaging is increasingly needed in the region in the fight against counterfeited pharma products, which have become a menace in the country. Additionally, in the tropical climatic zones of Indonesia, protecting medicines from harmful influences and enabling as long a shelf life as possible are important criteria for customers in the pharmaceutical industry. This makes glass an important packaging medium for the pharma companies. Though, currently glass’s share in overall pharma packaging sub-segment is comparatively less than the other countries covered in this article. But, with increased focus on healthcare and quality, it is expected that glass would garner
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asianglass AG 16-3
Container Glass producers in Indonesia Company
Country
Location
Installed Capacity
OI Jakarta
Indonesia
Jakarta
NA
PT Iglas
Indonesia
Jakarta
340 TPD
PT Schott Igar Glass
Indonesia
Jakarta
850 million/ year
more share in the sub-segment in coming years. Container glass producers have realised the huge opportunity and have fine tuned their operations in recent years in order to cater to the segment. In 2014, world’s largest glass container manufacturer, Owns Illinois made significant investment in its Jakarta plant. An existing production line was also recently upgraded to increase speed and capacity, allowing the company to continue to serve Indonesia’s leading food, beverage and pharmaceutical brands. In addition to beer producer Multi Bintang and vitamin drink producer Asia Health Energy Beverage, pharmaceutical company Supra Ferbindo Farma are one of the largest consumer of Owens Illinois’s container glass products in the country. According to O-I Jakarta’s President Director, Joseph Haddad, O-I’s investment is a direct result of growing customer demand and the company’s confidence in the growth prospects that exist for Southeast Asia-based manufacturers. He further says, “The Indonesian and Southeast Asian markets represent major opportunities for our Jakarta plant, which has supplied Indonesia’s pharmaceutical, food and beverage markets with quality glass containers for the past 40 years, and is set to play an integral role in achieving O-I’s growth targets.” Specialised pharma glass producer, PT Schott Igar Glass, a subsidiary of German glassmaker Schott entered Indonesia in 1996 by establishing a joint venture with a subsidiary of pharmaceutical maker PT Kalbe Farma called PT Igar Jaya. In 1997, Schott purchased Kalbe’s 51% stake in the venture and consolidated the Indonesian company under Schott International. Within a few years, Schott moved all its production from Malaysia to Indonesia, to produce for the local market and to export as well. About 60% of its products are sold locally, while the rest is exported to about 20 markets in ASEAN, the Mideast, India and Pakistan. In 2014, Schott Indonesia expanded its Indonesian production capacity by 20%, as part of its overall strategy to offer higher quality pharmaceutical glass packaging solutions to meet the country’s growing middle-class demand. The factory is located on 30,000 square meters in Bekasi, and has 70 production lines, which can produces 850 million vials, ampoules, pipettes and special articles for the pharmaceutical market every year. The production facilities are equipped with special automatic monitoring systems for quality control. The continuous control of operations with video cameras and sensors guarantees the automatic rejection of products that do not meet specifications during the production process. With the help of special analytical tests, product quality is also tested and guaranteed in the company’s quality laboratory. After delivery, products and batches can be traced using numbering systems corresponding to the respective customers. Globally operating companies such as Roche, Aventis and Pharmacia and local companies like Biofarma and Harsen are leading consumer of container glass from the company’s operations.
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ANALYSIS: Float Glass
Counting the float glass profitability proves key
In the first of a two-part focus, AG looks at the relative profitabilities of operating float glass plants across Asia in direct comparison with other locations.
I
t is no secret that Asian float glass producers have achieved one of the lowest costs of production in comparison to their global peers. Lower cost of energy, availability of raw materials and lower labour cost have enabled most of Asian countries to produce float glass at much lower costs as compared to their peers in Europe and Americas. On the prospectus of better profitability of float glass operations in the continent, Largest flat glass producers in flat glass industry, namely Saint Gobain, Nippon Sheet Glass and Guardian Industries, have suppressed European and American production capacities and have all made a dash towards Asian countries in last two decades. However, with an overall slowdown in the global and Asian economies post 2008, most of the manufacturing industries, including glass have come under severe stress to maintain profitability. Float glass industry is being doubly impacted by the economic crisis, since its activity relies heavily on the economic health of other sectors such as the construction and automotive sectors. Weak economic growth and slowing domestic demand has affected float glass producers in different countries of the continent in different ways. Maintaining profitability of float glass operations becomes doubly important in the face of depressed glass demand across the region.
Cost components
A flat glass plant is highly capital-intensive: depending on location, size, technology and product complexity, a new plant costs from USD 70 million to USD 200 million. It is designed to operate continuously, 365 days per year, and its operating life, known as a campaign life, is up to 15 years. Generally speaking, plants do not become profitable until reaching over 70 per cent capacity utilization. Since float glass production is not labour-intensive, energy and raw materials costs are more significant (often accounting for almost two thirds of the production costs) as compared to labour costs. Float lines are normally capable of several “lifetimes” following major repair or upgrade programmes (USD 30 million to USD 50 million). Glass is relatively heavy, making distribution costs significant; they typically
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represent around 10% to 15% of total costs. Heavy nature of glass makes it uneconomic for glass to be transported long distances. Typically, 250- 300 kilometers is seen as the industry norm, with 600 km as the economic limit. Though, these distance limits are not sacrosanct and distance travelled by float glass products varies between different Asian markets and the products’ added-value. It is possible for float glass to be economically transported along longer distances by sea. This tends to favour float lines with local port access unless a local market is available for the line’s output. This is the reason why the vast majority of glass produced in the Eastern coastal cities of China and many of South Eastern Asian countries can be easily transported and sold in the other Asian countries. Some of these manufacturing locations also profit from low energy costs allowing them to be very competitive on production costs.
Favourable fuel prices
Historic lows made by natural gas prices have been one of the largest beneficiaries for float glass producers in 2015. Low level of natural gas and crude oil are expected to benefit float glass producers in the short and medium run. Since, normally, float glass producers enter into long term contracts with energy suppliers, the sudden drop in prices hasn’t resulted in immediate benefits in the last year, however, low fuel prices are expected to show positive results towards the profitability of float glass producers in the current year.
China: overcapacity issues
Cornering almost half of world’s float glass production and consumption, Chinese float glass industry doesn’t stop to amuse glass industry stakeholders in many ways. However, last two- three years period has not been one of the best periods for a number of float glass producers in the country. Despite, a huge demand in domestic market and significant cost advantage enjoyed by Chinese producers over most of the Asian producers, a number of float glass operators were forced to shut their operations. In past few years Chinese authorities have been reviewing flat glass production projects closely and been trying to close substandard projects
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ANALYSIS: Float Glass
e cost CHINA
JAPAN
S KOREA
IRAN SAUDI ARABIA
THAILAND
PAKISTAN
VIETNAM
UAE
INDIA PHILIPPINES
INDONESIA
MALAYSIA
Leading float glass producers in the Middle East Country
in an effort to curb overcapacity in the flat glass sector. New projects can get approval from national authorities. Most of the small size float glass production plants (with capacities in the range of 400- 500) are the worst sufferers, as these producers are unable to achieve economies of scale in tough market conditions. Due to the reduced demand from the construction glass industry in China, the demand for float glass has also been affected since the second quarter of 2014. Also, the over-supply of the float glass capacity in China and increase in the production costs are the major factors for the decrease of the profit margin of the float glass business in China. Flat glass production in China dipped 8.6 percent in 2015, while profits declined 12.4 percent. Ministry of Industry and Information Technology (MIIT) said the government would step up efforts to cut capacity and “strictly enforce environmental standards� in the glass sector.
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Installed Capacity
China
131,500 TPD
India
5600 TPD
Indonesia
4200 TPD
Vietnam
3200 TPD
Iran
4800 TPD
Thailand
2800 TPD
Japan
5400 TPD
Malaysia
1600 TPD
S Korea
2400 TPD
Philippines
520 TPD
Saudi Arabia
1850 TPD
UAE
800 TPD
Pakistan
1300 TPD
AG 16-3 asianglass
35
ANALYSIS: Float Glass
Leading float glass producers in the Middle East Company
Location
Capacity
Advantages
RAK Guardian Glass
UAE
700 TPD
Low energy cost. Lucrative UAE market
Arabian United Float Glass Company
KSA
600 TPD
Low energy cost and vast domestic market, which is highly dependent on imports.
Saudi Guardian
KSA
550 TPD
Above
Obeikan Float Glass
KSA
800 TPD
Above and economies of scale.
Iran Float Glass
Iran
500 TPD
Low energy cost and vast domestic and neigbouring markets. Ample port facilities for exports. Strong backward integration.
Kaveh Float Glass
Iran
700 TPD
Above + Economies of scale
Asa Float Glass
Iran
700 TPD
Above
Sahand Float Tabriz Company
Iran
650 TPD
Above
Azar Glass Industrial Company
Iran
350 TPD
Low energy cost and vast domestic market
Ardakan Float Glass
Iran
900 TOD
Above + Economies of scale
One of the largest float glass producers in china, China Glass Holding Company has reported a loss in 2015. According to the preliminary review of the unaudited consolidated management accounts of the Group for the year ended 31 December 2015, the Group expects to record a loss of RMB400 million for the year ended 31 December 2015, as compared to a profit of approximately RMB13.16 million recorded for the year 2014. The company attributed the loss to the macro economic slowdown, which had caused a decrease in the downstream demands and an intensification of competition in the glass industry, which lowered the selling price and gross profit margin of the main products of the company. However, other major float glass producers, such as Xinyi Glass Holding, Luoyong Glass and Fuyao have registered profits for the year. Yet, a number of smaller and standalone players have either experienced a flat year or suffered losses.
The Middle East advantage
Float glass producers based in the Middle East Asia region have benefitted immensely on account of one of the cheapest energy costs, proximity to large float glass importing markets of Africa and Europe. Ample availability of natural gas throughout the region at one of the lowest costs across the globe has made float glass production in the region as more profitable, as compared to other Asian locations. Three countries in the region, which have float glass plants (Saudi Arabia, Iran and UAE), are now some of the cheapest destinations of natural gas in the region. Ample availability of high quality silica sand in their respective countries and in immediate neighborhood has further helped these producers to keep the production cost of float glass at one of the lowest in the world. In addition to the advantages in factors of production, many of the float glass producers in the region are highly backwardly integrated operations, which enable them to
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asianglass AG 16-3
acquire raw material at very competitive rates, as compared to standalone operators. Guardian, which runs two float glass plants (UAE and KSA), has the advantage of technical prowess, higher bargaining power in terms of raw material purchases and capacity flexibility.
South Asia booms
Huge domestic market in their countries has enabled float glass producers to maintain profitability in India, Pakistan and Bangladesh. With a population of more than 1.6 billion (more than China’s population), the region’s float glass demand is met with just 12 float glass lines, three of which (one each in India, Pakistan and Bangladesh) have come up in last two years. South Asian float glass producers don’t have the advantage of ultra cheap natural gas. However, availability of key raw material inputs and large domestic demand has kept most of the operations profitable. However, there are a number of external factors, which has had an adverse impact on the operations of these producers. Dumping ( as alleged by these producers) of float glass by their West Asian counterparts has been a major issue in front of these South Asian producers. According to a mid level executive from Gujarat Guardian, “In last few years a number of float glass lines came up in West Asia on the back of cheap funds and the extraordinarily low cost of gas. The price of gas for these float glass makers is just about $0.75 a million British thermal unit (mBtu), whereas it is about $16.5 for Indian manufacturers. For every dollar difference in gas pricing, the impact on the price of glass is $7-8 a tonne.” In order to maintain profitability of Indian float glass producers, Indian authorities imposed antidumping duties on float glass imports from UAE, Saudi Arabia and China in 2014. However, after imposition of dumping duties from these countries, source of float glass imports has shifted to Iran and China. Indian float glass producers have again petitioned to the government in a complaint
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ANALYSIS: Float Glass
Leading float glass producers in Southern Asia Company
Location
Capacity
Advantages
Saint Gobain India
Chennai, Bhiwadi and Gujarat
2900 TPD
Economies of scale, group strength and geographical reach.
Asahi India
Roorkee
700 TPD
Group strength.
Gujarat Guardian
Gujarat
600 TPD
Group strength
HNG Float Glass
Gujarat
550 TPD
JV with Trakaya Cam
Gold Plus Float Glass
Himachal Pradesh
450 TPD
Locational advantage. One of two float glass plants in North India
Tariq Glass
Pakistan
550 TPD
Large domestic market
Ghani Glass
Pakistan
500 TPD
Large domestic market
PHP Float Glass
Bangladesh
300 TPD
Large domestic market
Nasir Glass Industry
Bangladesh
450 TPD
Large domestic market
filed in December. Currently, concerned authorities are investigating the matter. The other two producers in South Asia, Pakistan and Bangladesh have also been the dumping grounds from float glass producers from China , Indonesia and the Middle East. However, limited installed capacities in their domestic markets have not yet had much impact on the domestic glass producers. Currently, there are three new float glass plants under consideration in these countries. While, existing producers Nasir Glass and PHP Float are considering these float operations in Bangladesh, Pakistani government has initiated commencement of a float glass plant in country’s Khyber- Pakhtunwa area. Government authorities have got a couple of feasibility studies on the float glass plant in the area.
Saint Gobain- India – A case study
Saint Gobain’s fully integrated factory at Sriperumbudur, about 35 km west of Chennai, will get a third float glass line of 1,000 tonnes a day and a second magnetron coater line with a capacity of 84 million sq ft per year for making high performance, energy efficient glass. This will make it the largest float glass plant in India. According to B Santhanam, President and MD-Flat Glass ( South Asia, Malaysia and Egypt), Saint-Gobain India, “ Work on the expansion has started with orders placed for the Magnetron coater equipment from Germany.” The new capacities in coated line will go on stream in 2017 and the float glass line in 2018. The 177-acre Chennai factory is unique as it is a fully integrated plant making value added glass products, including advanced laminated glass such as bullet proof glass, starting from basic raw material sand. Currently, Saint Gobain’s manufacturing facility has two float glass plants with total capacity of 1,500 tonnes, mirror and lacquer line of 50 million sq ft; and a magnetron coater of 60 million sq ft of glass per year. It also makes 1.2 million sets of automotive glass annually. Referred to as a World Glass Complex, the subsidiary of Saint-Gobain, is a regional manufacturing hub catering to the domestic market and to West Asia, Africa, Australia, New Zealand and the ASEAN region. Indian arm of the French company is taking new initiates to minimize
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asianglass AG 16-3
SAUDI ARABIA, IRAN AND UAE, ARE NOW SOME OF THE CHEAPEST DESTINATIONS FOR NATURAL GAS IN THE CONTINENT
the cost and improve the profitability by mining the vital raw material, silica from lignite mines in Neyveli. “ Saint Gobain has a process through which sand from lignite mines in Neyveli can be used to make glass and products for the ceramic industry, “ according to Mr. Santhanam, MD. The company is in the process of launching the pilot project with the public sector company, Neyveli Lignite Corporation to get the sand from the millions of tonnes of soil excavated by NLC to reach the lignite deposits. Currently, Saint Gobain India is sourcing a majority of its silica sand requirements from Egypt. Getting raw material within 200 km of its Chennai factory presents obvious advantages in terms of cost and efficiencies for Saint-Gobain India. Saint Gobain India’s annual turnover now stands at INR 49 billion and it’s the largest glass producer in India.. Through all this it has maintained a steady record of profitability, which has recently led to company’s Paris based head office budgeting for INR 23 billion of investments in India. “Saint Gobain India’s success lies in the way we have managed to keep a good balance between growth and profitability.” Mr. Santhanam further adds. When Saint Gobain made its first investment in a glass plant in Chennai, there were already five established players in the market — including global joint ventures Gujarat Guardian and Tata Asahi — and all of them were then losing money. But coming in late was not without its advantages. Santhanam says: “We took a different view of the market. We went for scale and the latest technology in the belief that the Indian market was
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ANALYSIS: Float Glass
set to evolve.” By the time the Chennai project (total investment: Rs 1400 crore) came on stream, the market had expanded and Saint-Gobain Glass India began making profits earlier than expected. The company repeated this strategy of investing in a downturn with the Rs 686 crore acquisition of the float glass business of Sezal Glass in 2011, giving it a presence in Western India. This was followed by a greenfield facility in the North, located in Bhiwadi, Rajasthan, pegged as Saint Gobain’s biggest glass manufacturing unit in the world.
ELECTROGLASS THE KEY TO IMPROVED
ENERGY EFFICIENCY
Xinyi Glass Holding
One of the largest float glass producers in China, Xinyi Glass has had a tough year in the light of decreased demand of glass in China. However, increasing demand for the energy-saving Low-E glass in the construction industry in the PRC resulted in a moderate increase in the revenue of the company. In order to maintain its leading position and profitability, Xinyi Glass has also implemented a series of enhanced control measures on the consumption level of the raw materials, the recycling of the principal raw materials and the use of solar power and residual heat for energy generation. To maintain the Group’s competitiveness, the Group has successfully developed and launched a wide range of high value-added glass products and adopted proactive pricing and flexible marketing policies to take advantage of the measures implemented under the Twelfth Five-Year Plan of the PRC government. The Group’s strength in operational management, combined with the continuous improvements in the production process and well planned equipment maintenance programs, have enhanced its productivity and yield, which in turn reduced the overall production and energy costs. The Group’s economies of scale enable significant savings in the production and the fixed costs and increased efficiency in fuel consumption.
Asahi Glass
One of the three major float glass producers, Japanese Asahi Glass has been suffering losses for last four years. The company is juggling its float glass operations ( worldwide ) to achieve a lower cost of production. In Asia, Asahi started operations of its third plant in China in 2015. The company also invested in a new float plant in Indonesia, which is expected to come on-stream later this year. According to AGC’s Glass President, Yoshiaki Tamura, “To improve future earnings capacity, we will set a focus on developing and expanding business in growth markets, including those in South East Asia and the Middle East. And while doing so, we will continue strength building and structural reform initiative. For example, instead of building production facilities all by ourselves, we will make use of joint ventures and build rational and effective production frameworks adapted to local market characterstics.” In the first nine months of 2015, Asahi Glass group operating profit rose 22% on the year to around 52 billion yen ($429 million), marking the company’s first profit growth for January-September in five years. Float glass operations, saw profitability improve thanks in part to the sale of money-losing operations. The company is consolidating European plants to raise earnings power, too. Asahi Glass is taking initiatives on the operational front to improve the profitability including increasing focus on value added products (such as hard cost reflective glass, soft coat reflective glass, tinted, décor etc) in the float glass segment. For example, in India, its subsidiary has stopped the production of float glass at its Taloja plant in May, 2014 owing to age and expiry of useful /operating life of the furnace. The plant was mainly into production of commodity float glass product which had relatively lower margins. The plant was operating at loses, thereby, the closure of same shall result in higher overall margins.
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AG 16-3 asianglass
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ANALYSIS: Gujarat
Advantage Gujarat flat glass shows an upturn
Increasingly seen as India’s manufacturing hub, Gujarat continues to grow in importance across all industrial sectors. AG looks at how flat and processed glass makers are getting in on the act.
T
he flat and processed glass industry in Gujarat has had a healthy tradition of private entrepreneurship and an equally healthy support from its successive governments. The state has also benefited from favorable exogenous circumstances, including locational and geographical advantages in terms of serving the domestic and international markets. In the last decade, the State has seen an exceptionally rise in flat glass production capacity due to large inflow of private commercial and industrial investment, attracted by good power supply to industry, good-quality roads, small and large all-weather ports and shore jetties and the expansion of industrial parks and special economic zones (SEZs) on the supply side. Easy availability of land and subsidised infrastructural facilities has been major factors in pouring of significant investment into the flat glass industry.
Automotive advantage
Architectural segment
It is not only the local builders who are cashing in on the construction boom. Developers from all over India have been trooping into Gujarat, including renowned companies like Tata Housing, Godrej Properties, India Bulls, K Raheja , DLF, Everest Developers, Hiranandani Group, Akruti City, Sahara Housing, Ajmera Group, Acme Group, Emmar and Mahindra Lifespaces, who are investing in housing, hospitality and infrastructure in various cities like Ahmedabad, Vadodara, Rajkot and Surat. Some of them are also joining hands with local developers. Two factors underlying this shift are lower land costs and the single-window clearance policy of the government.
Gujarat has emerged as one of the economic powerhouses of Indian economy in last decade propelling huge investment in residential and commercial spaces, which has had a positive effect on flat glass consumption in the state and its rapidly modernizing cities. Proximity to country’s financial capital Mumbai and another star performing state of Indian economy, Maharashtra has also benefitted the flat glass producers in the state. Prior to opening of Saint Gobain’s Rajasthan plant in 2015, the state based flat glass producers had a vast market to their disposal as there was no other float glass manufacturing plant in the states of Gujarat, Madhya Pradesh. The only float glass manufacturing plant in the state of Maharashtra ( operated by Asahi India) came to a close in 2014 also benefited the state based flat glass producers. In fact, currently there is no other float glass plant in operation in the central part of the country other than those in the state of Gujarat,
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Though, automotive sector accounts for about 16 % of the total flat glass consumption in the country, yet, Gujarat accounts for a major part of this consumption. The state, which is fast developing into the largest automotive hub now, with plants of GM, Asian Motor Works, and Tata Motors is expected to witness a major surge in automotive glass demand. Besides, these three there are Others in the pipeline, which include Ford India and Maruti Suzuki. It helps that India’s other auto hub, the Pune-Talegaon belt, which is relatively close by. “Automakers are among the biggest consumers of float glass in India,” says Kailash Jain, president, HNG Float Glass. “And there are many automotive companies coming up in Gujarat — GM is just across the road from our factory.” That isn’t the only plus Gujarat offers. The best sand for making glass is available in Bhuj; by sourcing from Bhuj, HNG is able to keep a lid on its transportation costs.
Real estate angle
Production overview
The State of Gujarat is home to four of the nine float glass lines operating in the country. Accounting for 1930 TPD of country’s 5530 TPD of flat glass capacity, the State accounts for highest share of float glass production among all the states in the country.
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ANALYSIS: Gujarat
So, what is it which makes the state the hub of float glass production in the country? From finished product consumption point of view (basic float glass and value added glass), NCR and Northern region tops the chart, followed by the Western region, none of which are very close to Gujarat. Yet, Gujarat remains a strong draw for glass manufacturing due to a number of reasons. Proximity to raw materials, reasonable land rates, some of the best ports, and peaceful industrial relations. Over time, other positives have been added to the list — excellent road connectivity with Vadodara, Delhi and Mumbai, zero power cuts and adequate supply of gas as well as water. Little surprise then that the state has managed to attract giants from all walks of industries like auto, tyres, security solutions, pharma firms and a host of small and medium enterprises in the plastics and engineering industries, besides our industry.
Saint Gobain
Country’s largest flat glass producer, Saint Gobain entered Gujarat via the inorganic route by acquiring the already running float glass plant of Sezal Glass in 2011 for a consideration of about INR 7 billion. In fact, this was and continues to be the only consolidation exercise in the Indian float glass industry. Located at Jagadhia in Bharuch district of the state, the float glass plant is ideally located in proximity of key raw materials and float glass consuming markets of Western India. Acquisition of Sezal Glass’s float glass plant, with access to raw materials in the vicinity, has provided Saint Gobain India a larger footprint in the western region, the second largest market for float glass products in the country, on account of spate of constructions in the country’s financial capital Mumbai and neighboring region as well as a large automotive market
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asianglass AG 16-3
THERE ARE MANY AUTOMOTIVE COMPANIES COMING UP IN GUJARAT — GM IS JUST ACROSS THE ROAD FROM OUR FACTORY in the region. At the time of inception, the original parent company ( Sezal Glass) had also signed an agreement with the Gujarat Government to invest another Rs. 750 crore on another float glass line. However, no development has taken place on this line till now. Post acquisition, Saint Gobain made additional investments of INR 100 crore in the acquired plant for raw materials to make it a manufacturing hub for West India. According to Saint Gobain India’s MD, B. Santhanam, “The Company could have set up a plant on its own, but it would have taken three years.” After commissioning of its Rajasthan unit in early 2015, Saint Gobain has
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ANALYSIS: Gujarat
Leading Gujarat flat glass makers Location
Commenced production in
Installed capacity
Gujarat Guardian
Ankleshwar
1996
650 TPD
HNG Float Glass
Halol
2010
600 TPD
Jagadhia
2010
550 TPD
Govali
2011
130 TPD
Company
Saint Gobain India Gujarat Borosil Limited
become the only float producer in the country to have manufacturing presence in all the three important consuming regions of the country. According to B Santhanam, “Saint Gobain has come a long way in India after it made an Rs 525-crore investment in 1999-2000 to set up its first green-field project at Sriperumbudur. The facility was set up to cater to the demand in South India but today it has grown to become the regional manufacturing hub for advanced products.”
HNG Float Glass
India’s largest glassmaker, Hindustan National Glass Limited ( HNGL) entered float glass business by setting up its first float glass plant in Gujarat. Built over 121 acres of land in Halol, this plant became operational in early 2010. Built with an installed capacity of 600 TPD, HNG Float Glass can produce float glass in the thicknesses of 1.87 mm to 19 mm in width of 715 – 3660 mm with a length of 900-6100 mm. The plant also has two value added processing units i.e. insulating glass unit (IGU) and tempering unit with a capacity of 2.4 lakh sqm each along with a mirror line having an installed capacity of 2.5 lakh sqm per annum. Apart from these operations, the Company is also involved in trading of float glass in order to meet the diverse requirement of clients. Country’s only glassmaker , which has a presence in both the major subsegments ( container and float) had made the foray in float glass production with an eye on rapidly growing demand of float glass products in the Western part of the country and to take advantage of its background in the glass industry. In 2013, Turkish glass maker Trakya Cam Snayii AS bought 45% stake in HNG Float Glass through a joint venture agreement According to the JV, Hindustan National Glass and Industries (HNGIL) and promoter of HNGIL i.e. Somany family which promoted HNG Float glass diluted its stake and both the companies have become equal share holder at 45%. Prior to Trakya Cam’s entry, HNGIL and Somany Family held around 47.4% and 40.2% stake and remaining 12% was held by IFC Washington. Post the joint venture, share of shareholding company and the promoter of HNGFL has reduced from approx.87.6% to 45% and Trakya Cam Snayii AS become an equal shareholder with a 45% stake in HNGFL. Trakya Cam Sanayii A.Ş., which was founded by Şişecam in 1978, is the leading company of the flat glass market in Turkey. This is not the first foray of Turkish company in foreign flat glass manufacturing scene. In the past, Trakya Cam Sanayii A S had taken a strategic step in 2009, with the decision to jointly develop its flat glass activities with Saint-Gobain, in Egypt and Russia.
Gujarat Guardian Limited
The first float glass plant in India, Gujarat Guardian commenced operations in the state of Gujarat in 1993, when global flat glass major Guardian Industry started this float glass plant in association with three domestic Indian companies ( Modi Rubber (22.4 % share), Gujarat Alkalies & Chemicals Limited (GACL) and Gujarat Mineral Development Corporation Limited (GMDC) both have 4.73 % share each). Gujarat Guardian currently produces float glass of thickness 2 mm to 12 mm, and mirror glass, with a float line with pull ton capacity of 640 MT per day, a mirror manufacturing plant with a capacity of 4.2 million square meters per annum. In order to secure an assured supply of silica sand, the company has installed a sand beneficiation plant in the float premises with a capacity of 55 tons per hour.
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Located at Ankleshwar in Bharuch district of state (60 Km from Surat) and 80 km from Vadodara. Mumbai is approximately 350 km and Ahmadabad is 200 km away from the plant. This float glass plant paved the way of inception of float glass industry in the country. The company remained the sole supplier of float glass demand in the country till 1998, when second float glass line was commissioned in the country. Besides, float glass, Gujarat Guradian is also one of the largest mirror producers in the country. The company had invested Rs 14 crore in a state-of-the-art plant located in Bharuch in Gujarat for manufacturing environmental-friendly mirrors under its brand ‘Modiguard’. The plant, built with the latest mirror manufacturing technology from Klopper, Germany, has a capacity of 3,500 tonne of mirror per month. The company completely brought down the old plant, which had a 2,000 tonne capacity and built the new plant. GMP (green mirror processing) coating is used in the new mirror to give stronger protection to the silver film and does away with the traditional copper coating. It is given a computerised controlled uniform silver spray to avoid fractures in the silver film and Palladium is used for better bonding of silver film and removing the likelihood of dark spots. Finally, two coats of lead free imported paint are applied for better protection of silver film. The mirror is subjected to various tests in the laboratory to ensure longer life and consistent quality. The new plant can manufacture mirrors of 3 mm to 8 mm thickness in large sizes up to 3.6 meters. It is located in the same premises as the company’s float glass plant.
Gujarat Borosil Limited
Promoted by Borosil Glass Works Limited manufacturer of well known and household “BOROSIL” range of glass ware lab ware, scientific ware and consumer ware products, Gujarat Borosil Limited is the sole producer of flat glass products for solar industry in the country. Set up in 2010, the plant commenced commercial production of low iron glass for PV industry in 2011 with an installed capacity of 130 TPD. Planned and commissioned after announcement of India’s ambitious National Solar Mission, which envisages setting up of 20 GW of solar energy in India by 2022, the management had anticipated huge order inflow of low iron glass covers from PV module makers. The Company claims that its products are of international class and currently significant portion of its production is being exported.
Processed Glass industry in Gujarat
Almost parallel to the development of state’s flat glass industry, processed glass industry in the state has seen major investments in past ten years. Sezal Glass, HNG Float Glass ( the company is one of the largest processed glass producer from its float glass complex), Italian company Pino Bisazza Glass Private Limited and a number of recent entrants in toughned and insulating glass production has led to brisk development of processed glass industry in the state. Besides, residential segment, value added glass demand from commercial (both large and small establishment) have been the major driver of glass demand in past five years. Construction of Delhi- Mumbai Industrial corridor, a large part of which would be in Gujarat, setting up of smart cities and focus on service sector are some of the factors , which will have a positive impact on the growth of value added glass industry in the state for years to come.
Sezal Glass
One of the best known names in Indian glass processing industry, Sezal Glass is a leading player in the glass processing and architectural glass solutions. Incorporated as a private limited company in 1998 and subsequently converted into public company in 1999, the company is in the business of processing glass at its state-of-the-art plant located at Union Territory of Dadra, Nagar Haveli at Silvassa. It started its commercial operations in the year 2001 by setting up a processing facility for insulating glass and thereafter for toughened glass. Since then, the company has expanded its operations by adding an automated lamination line in 2007 and broadened
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ANALYSIS: Gujarat
Processed Glass Processing Companies in Gujarat Company
Location
Products
Shree Umaiya Glass Works
Anand
Toughened Glass
Vishvesh Glass Pvt Limited
Ahmadabad
Toughened Glass
Jajoo Architectural Glass
Halol
Insulating Glass
Mahavir Glass Enterprise
Kheda
Toughened and Insulating Glass
Swastik Glass Industries
Ahmadabad
Toughned Glass
Shree Rang Glass
Ahmadabad
Toughened and Insulating Glass
Thermosol Glass
Ahmadabad
Toughened and Processed Glass
Hiral Enterprises
Anand
Processed Glass
Art Glass Industry
Valsad
Processed Glass
Pino Bisazza Glass Private Limited
Kadi
Mosaic, decorative glass and agglomerates
Sumangal Glass Industries
Kutch
Figured & wired Glass
Shree Valabh Glass Works Limited
Vallabh Vidyanagar
Sheet Glass
its scope of business activities by processing various value added glass for exterior and interior applications, including decorative glass. The company’s key clients consist of Reliance, K. Raheja, SP Fabricators, L&T, to name a few. Sezal Glass is one of the two companies ( Gold Plus Glass being the other) in India, which graduated from a glass processor to float glass producer. The company established its float glass plant in Gujarat in 2010 at Bharuch and sold it to Saint Gobain India a year later.
Pino Bisazza Glass
Kadi, Mehsana based Pino Bisazza Glass Private Limited (PBGPL) is engaged in the business of manufacturing glass mosaic, decorative glass and agglomerates. With an installed capacity of 15,000 MTPA (Metric Tonne Per
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Annum) Pino Bisazza has emerged a leading name in decorative glass industry in the state and country. PBGPL is the subsidiary of the Trend Group, Spa; based in Vicenza, Italy, which has 67% stake in the equity of the company, while the remaining stake is held by an Indian entity.
Anti-dumping issues
Indian Finance Ministry’s decision to impose anti-dumping duty on certain float glass imports from China in the end of 2015 is expected to give a boost to Gujarat based producers in coming years. Earlier, Indian government had also imposed anti-dumping duties from UAE, Saudi Arabia and Pakistan, most of which was landing on the Western coast of the country and affecting the Gujarat based producers most. Since, this duty would be valid for five years, state based producers have become immune to the onslaught of Chinese and the Middle East based glass producers due to imposition of anti-dumping duty of $ 218 per tonne. This anti-dumping duty has been levied on float glass of thickness 2 mm to 12 mm (both thickness inclusive) of clear as well as tinted variety (other than green glass). However, to the great dismay of state and India based producers, reflective glass, and processed glass meant for decorative, industrial or automotive purposes were spared from the anti dumping duties, creating a situation of oversupply of these products in the state. Four of the producers mentioned in the processed glass producers table have put their expansion plans on hold for sometime in view of the decision and huge influx of value added glass products imports.
A word of caution
Despite, a lot of positives working in favour of flat and processed glass producers in Gujarat, it isn’t all peaches and roses for the stakeholders. Problems like the overcapacity of basic float glass due to huge capacity expansion in the state in recent years and more recently by induction of a new float glass plant by Saint Gobain in neighboring state of Rajasthan (and a projected surplus of processed glass), Chinese competition (in spite of anti-dumping duties), a moderate slowdown in country’s economy and construction sector and last but an important factor in determining the glass demand i.e. lack of codes of standards threaten Gujarat based glass producers and processors.
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ANALYSIS: Russia
windows… fenestration challenges in Russia
Stanislav A. Chesnokov, and Alexander G. Chesnokov,of the Glass Research Institute, Moscow, Russia, discuss glazing developments within Russia.
T
oday a number of sustainable stamps have developed and both manufacturers of glass and glass products and their consumers tired from them. For example: - To reduce heat loss one needs to use low-emissivity glasses; - To provide shock resistance safety films are needed; - To improve sound insulation one has to use double-chamber, triple glazing. We are persistently talking about energy efficiency and security for over 20 years all together. As a result, both of these subjects lost the interest of everyone who regularly attends glass workshops, conferences, reads industry publications or visit relevant sites. However, the public, who does not visit these events and publications, still knew nothing about modern glazing. We need some new approaches, new topics of interest to people who did not catch our traditional conversations. At the same time, we said almost nothing about the many features of modern glass, which can be useful to certain groups of consumers: increased transmission of ultraviolet radiation, absence of splinters when the glass is broken, the warm window-sill etc. There are quite a lot of such properties and it is possible to expand of state-of-the-art glazing and complex IGUs application if such features will be bear in mind. It is important to discuss some properties of the modern glazing mostly to mark some objects to study for the glass industry and to start new approaches to the specific customers. Of cause, our experience bases mostly on the CIS glazing market. As glass expert consultants, we receive many questions concerning specific needs of the projects. Today there are many glass types
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asianglass AG 16-3
offered to the customers as we listed in the Table 1. It is obvious, that each of them has its own advantages, interesting properties for the consumer.
Energy efficient glazing
Let us start from the new approaches to the traditional themes. To begin with, we want to discuss energy saving. This is favorite subject of the industry for the long time. However, when customers hear about energyefficient windows using, IGU with low-emissivity glass etc., they frequently respond with the simple idea that “Why need I to bother? My home is very warm!” Most of the customers from multistory buildings in large cities are sure that the comfort in their apartments depends from the heating system. In the last years, heating of the residential building in Russia is quite reliable. References to the norms or building codes have no positive effect to the customers. But if we take into account the comfort problems during the spring and fall, we can find that there are gaps between real outdoor weather conditions and central heating work. It is normal to have no heat with outside temperature of 9°C. Energyefficient glazing could provide additional support for the comfort inside in this case and help to keep temperature in the home or office on acceptable level. It is worth to mention that in case of central heating failure energyefficient glazing can considerably increase the time of temperature fall to 0°C – from 8 hours to up to 72 hours in the model with old mass-market building and outside temperature of -20°C. In practice, it means that there is enough time to deal with a breakdown.
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ANALYSIS: Russia
The conditioning and solar control problems are not so important for Russian conditions and customers but still they need to be taken into account during estimation of glazing project. To finish with the heat transfer problems we want to discuss the “cold window-sill” question. It is not obvious for a customer that even air-tight and water-tight windows could support cold zone with strong convection currents and water condensation in the cold winter conditions. Such cold zone is uncomfortable for the home plants, furniture and residents. Low-emissivity glasses and energysaving IGUs will be actual if people can understand why it is necessary for them in their particular situation.
Safety glazing
Installation of the safety glazing in the residential building meets a lot of resistance from the customers in Russia. Usually the customers think about safety from the outside threats, And the only threat they really consider higher than 10 m is the bird crashes. But in our expert observations and conclusions we often mark that the real danger can be avoided if we will bear in mind our inside threads like children games. Considering all probable threats from both directions we can find reasons for the application of laminated glass, protection film coated glass, tempered glass, chemically tempered glass or heat-strengthened glass. Every type of safety glass has its own advantages, which can play the leading role for some customer group. Additionally, such types of glass can be combined in some complex glazing. If we consider safety in a more wide therm than simple protection from injury and more like general protection of human health and the preservation of material values, it is possible to include soundproof or UVprotection capabilities into consideration. The life quality of the residents really depends from the noise level reduction and furniture color and fabric protection. In the case of lack of ultraviolet radiation - for example, in gardening - it is possible to use tempered extra clear glasses. They combine high solar radiation transmission with additional safety features. Also it worth to mention that there are antibacterial and self-cleaning glasses on the market for the last ten years at least. And they still can’t find the way in the wide application market despite their obvious advantages.
Other issues
During the winter condensation on the window glass is usual issue. Radical solution of this problem is well-known IGUs with electroheating. Conductive glass have to be tempered and often is laminated (so improved sound insulation goes in addition). In many privacy issues the perfect solution is the clear patterned or matted glass. In many cases such types of glass is the best alternatives in terms of natural lightning saving, cost and privacy protection. Tinted, colored, decorative coated glasses can add emotions in the building and visual appearance and outside view from the inside. Additionally, enamelled and lacquered glass is tempered in many cases, so they can provide safety features. Solar-control and multifunctional glass works better on the sun side of the building and protects from the excessive heat.
Conclusion
Many more ideas can be proposed to the customers in their particular project. We propose the wide diversified view on the glazing project development. Any small project needs to include a lot of specific characteristics of the site, location, residents etc. In that case none of the potential client will not pass over, everyone will become real clients.
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Glass types on Russian market Glass type
Active norms in Russia
Flat glass, including:
GOST 111-2001
- Colorless
GOST R 54170-2010
- Extra clear
GOST R 54170-2010
- Tinted
GOST R 54169-2010
- Patterned
GOST 5533-2013
- Wired
GOST 7481-2013
- Wired polished
GOST 7481-2013
Laminated glass, including:
GOST 30826-2001, GOST R 541712010
- Shock resistant
GOST R 51136-2008, -«-
- Vandal-proof
GOST R 51136-2008, -«-
- Bulletproof
GOST R 51136-2008, -«-
- Safety - Blast proof - Fireproof
GOST 30826-2001, GOST R 541712010 GOST 30826-2001, GOST R 541712010 GOST 30826-2001, GOST R 541712010
Chemically strengthened glass
Absent
Tempered glass
GOST 30698-2000, GOST R 541622010
Heat-strengthened glass
GOST R 54180-2010
Glass with solar control or decorative GOST R 54179-2010 hard coating Glass with solar control or decorative GOST R 54178-2010 soft coating Energy saving glass with hard coating
GOST 30733-2000, GOST R 541772010 GOST 31364-2007, GOST R 54176Energy saving glass with soft coating 2010 Self-cleaning glass
Absent
Glass with anti-bacterial coating
Absent
Glass with multifunctional coating
Absent
Frosted glass
GOST 32360-2013
Lacquered glass
GOST 32559-2013
Glass with polymer films
GOST 32563-2013
Insulated glass unit
GOST 24866-99, GOST R 54175-2010
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GLASS HAS A GREAT PAST.
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In focus
Anaylsis: Refractories
52
ORDA GLASS: A GAMECHANGER FOR CENTRAL ASIA? AG talks to Dave Mackay of USA-based Stewart Engineers about the progress of one of the most exciting developments in the region’s float glass industry… Asian Glass: Could you elaborate about the Orda Glass project. What is be the scale and scope of project on commissioning? Stewart: Stewart Engineers is the EPC Contractor for the 600MTPD Orda Glass project. We have handled all the details of construction and equipment since the contracts were completed. Our engineering and design staff has been very active both with Civil Engineering on site and equipment procurement. Our goal for this Glass manufacturing facility is to produce the highest quality glass in the world. We are enjoying working with our industrial partners and look forward to commissioning the line next year. It has been a pleasure to use our 30+ years of float glass project experience in collaboration with market leading subcontractors. AG: Your Company holds a significant stake in the Orda Glass project. Could you take us through the decision making process to join the project? Stewart Engineers has 30 years of float glass experience from Turnkey projects to working as a subcontractor on other plants. We value the privacy of all of our customers. There are confidentiality agreements in place that prevent discussion of this subject. There are no other float glass plants in Kazakhstan. It is normal for Stewart Engineers to doing everything required to insure the success of the project and provide operational support after ribbon pull. AG: Can we expect a similar arrangement in future in other upcoming glass projects or would it be a wait and watch policy? Some projects and business owners will want a financial partner and other will not. We are flexible in our approach to insure the success of each project. Stewart Engineers is strategically positioned with financial packages to assist new international businesses to invest in our glass technology and enhance their profitability. Stewart Engineers can provide a collaborative effort between US Government backed financing and private sector resources. AG: Orda Glass project has seen a lot of changes in terms of management composition in last three years. Are there some specific reasons for it? We are not aware of any management changes at Orda
asianglass AG 16-3
Glass. As with any customer’s project, multiple bids should be obtained and evaluated before contracts are signed for a such a large investment as a Float Glass Manufacturing Facility. Previous Kazakhstan float project inquiries have seen different participants and management changes but they were never finalized. AG: How and where do you see global float glass manufacturing industry five years hence? Emerging markets is a focal point for Stewart Engineers. From a global perspective, the most significant opportunities for new float glass manufacturing plants are emerging markets with long term growth potential. The worldwide glass market has 4 main global players, yet China holds roughly 50% of global flat glass capacity and none of the leading Chinese glass makers are listed in the top group of four. The primary global glassmakers have remained steady but there have been plant closings in mature markets like North America, Western Europe & China. Orda glass shows that there will be opportunities for float glass start up by independent glass makers. A strong position in a key niche market will still present opportunities for differentiation and growth. AG: Is it the first stake holding by Stewart Engineers or is your company a stakeholder in other float glass plants in Americas or elsewhere? Stewart Engineers is a privately held company. We don’t discuss our finances but as we noted earlier we take a pragmatic approach to insure the success of each float project. That is why we have so many strong friendships in our industry. It is our job to help our customers produce profitable glass products. We don’t just build a plant to produce float glass. We design an efficient plant to reduce labor costs and energy consumption. We help source high quality raw materials at the best possible prices to insure high quality glass production. Stewart Engineers has built float glass furnaces and complete plants for many of the industry leading independent float glass companies. AG: What was/ are the unique challenges faced by Stewart Engineers during the project? Stewart Engineers has 30 years of project management experience balancing the elements of time, money, scope and people inherent in a complex project like a float glass line. Education and experience have refined our best
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Anaylsis
practices to get all parties involved working towards a clearly defined goal that is communicated accurately and consistently. Stewart has a 100% on time history of project management which helps our customers return on investment. AG: Will the first phase of the project will involve producing coated glass and value added glasses or will you take a call on this post commission of the float plant? Value added high quality glass is always a key to profitability in competitive markets. Stewart Engineers is providing its state-of-the-art AcuraCoatÂŽ on-line pyrolytic coating system which will produce solar control coatings for the architectural market during the first phase of operation. AG: What would be the key strength and weaknesses of float glass production in Kazakhstan in terms of energy, raw materials and labour costs? One of the drivers for this project is the abundance of Natural Gas in Kazakhstan, In addition, the availability of high quality raw materials and the high skill level of labor enable a successful project. The state of the art design of the plant and high level of automation will facilitate efficient operation at Orda Glass. As is usually the case in Asia, labor costs in Kazakhstan are lower than Western Europe. AG: What is current demand-supply dynamics of float glass in Kazakhstan? Kazakhstan has a large internal market of 19 million
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people, and it has easy access to the entire Silk Road Central Asia market of over 142 million people. Kazakhstan’s economic growth has been based on energy, minerals, and agricultural exports. As is the case for many domestic gas-intensive economies, industries such as chemicals, steel and glass can help diversify the economy and spur innovation. There is no float glass production in Kazakhstan. All of the glass used in the country is imported mainly from Russia, Turkey, Iran and China. Flat Glass importation average about 450 Tons per day with the bulk going to architectural purposes but the importation of automotive glass is growing. The Orda Glass plant will satisfy the domestic market requirements with some excess capacity for exportation of value added CVD coated glass. AG: Talking about the overcapacity in float glass sector in the extended region (Iran, China, Russia), don’t you think float glass imports in Kazakhstan will have a deep impact on the profitability of Orda Glass plant? As you and your readers know there is an overcapacity of glass in China & Russia with low prices resulting but glass is still heavy and fragile and shipping long distances to a land locked nation like Kazakhstan carries high costs. The low costs for Natural Gas and raw materials discussed early will make Orda a strong regional glass supplier. In addition, our value added coated glass products differentiate us from other glass plants is the region.
AG 16-3 asianglass
53
Window on
RUSSIA
54
Float glass exports (sq metres)
Leading float glass export destinations (2015, sq metres)
Float glass imports (sq metres)
Leading float glass import sources (2015, sq metres)
asianglass AG 16-3
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ADVERTISER FEATURE
Bavelloni is back
Bavelloni, a historical leading brand in the glass working machines field, started his activity in 1946, being one of the pioneers in the development of flat glass processing. In 2003, the Company was purchased by the Finnish Glaston group, and continued its activities of engineering, constructing and installing machines for glass working all over the world under Glaston brand. Since last summer, after the acquisition of a group of Glaston Italy managers who purchased all shares and set up the new Company Bavelloni Spa, the brand Bavelloni is once again 100% Italian and it is finally back in the glass field. Together with product development and technology innovation, the commitment to promote consolidated relationships with their customers and partners and work on the continuous improvement of their services is a key element of Bavelloni Spa strategy plans. In this respect, the Company new web site www.bavelloni.com that is now online, represents a milestone for Bavelloni SpA to get closer to their customers and relaunch the brand globally. “Our presence in Asia has a very long tradition, with many installations from the Middle to the Far East” explains Bavelloni Sales Director and Partner Mr Federico Bassi. “We have recently participated in China Glass exhibition: Bavelloni booth has been very active all the time. Our brand is well-known and its comeback has been really appreciated in the local market, as well as in the neighbor countries, such as Taiwan, Japan and Korea. Shanghai fair could count on the participation of our sales partners and of operators coming from Australia, Russia, Emirates, Saudi Arabia, India, Pakistan, and Iran to name just a few.” Bavelloni core business has always been glass edging and bevelling. The present series of vertical straight-line edging machines named VE 350 and VE 500, is the latest evolution of a machine range that is regarded as a benchmark in the glass field for its reliability, userfriendliness and for the quality of the end product. Bavelloni edgers are available with a number of spindles from 6 to 11 for flat edge with arrises and they integrate the traditional features with innovative technical solutions to make the use easier and to improve reliability. The models with variable angle, VE 500 V10 and V14, represent the top range in the market. The innovative patented conveyor, with two motors electronically synchronized (that is available even for VE500 11), allows
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the processing of big thicknesses and large glass sizes. The machines can even be equipped with bigger racks (up to 5800 mm height) for edging big sheets in complete safety. Machine setting and control by means of the new operator interface is very easy: a big screen (10” touch screen) is used to improve the display of information in a very intuitive and simple way. Bevelling is a challenging working, so only extremely precise machineries can grant the quality of the bevel, the accuracy of the processing and the dimensional tolerances on the angles. Bavelloni has always been the world leader in this field, with thousands of machines installed and running all over the world. VB 350 and VB 500 models are different in productivity but do not compromise on the quality of the end product. Another important Bavelloni product is the family of double edgers HE500 series, coming from a more than 20 years’ experience in the production of double-edging lines, the most of them customized according to customers’ specific needs and layout. In this field, first in the market, Bavelloni has introduced a lot of patented solutions such as the diamond wheels automatic presetting, synchronized brushless motors for the conveyor belts, and many others. Among the first manufacturers of NC machines, Bavelloni developed a family of high range machines that differentiate for their exclusive solutions and for their reliability. Available in different models, Bavelloni NRG and ALPA machines can be used as stand-alone or integrated with anthropomorphic robots in automated work islands. Bavelloni Service has always been recognized and considered by the clients as one of the best in the market. Even in Asia, Bavelloni and their local partners are able to provide the right support and post sales service and assistance. “We give priority to the training of our technicians, as well as those of our agents and distributors. The same level of atten¬tion is given to spare parts stock. We are proud to have a dedicated warehouse, able to respond to each and every type of request and, above all, to provide assistance for the extensive number of Bavel¬loni machines around the world, some of which have been up and running for more than 20 years.” Moreover, Bavelloni de¬alers also have local wa¬rehouses to respond quic¬kly to the most urgent requests.
AG 16-3 asianglass
55
Total container glass imports (Kg)
Leading container glass export destinations (2015, Kg)
Total container glass imports (Kg)
Container glass imports from China (Kg)
Container glass imports from Ukraine (Kg)
Leading container glass import sources (2015, Kg)
56
asianglass AG 16-3
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ADVERTISER FEATURE
Bystronic glass technologies creates major interest At this year’s China Glass exhibition which was held in Shanghai from 11th-14thApril 2016 Bystronic glass once again presented intriguing, trend-setting technologies for efficient architectural and automotive glass processing. Thanks to the professional surrounding, highly skilled contacts and interesting conversations the trade fair were successful for Bystronic glass. At the well attended stand customers took the opportunity to examine a tps’applicator and the new finisher during live demonstrations that were held daily. The finisher is a newly developed machine that can make the patented bevel joint of the Thermo Plastic Spacer TPS® invisible by request. The tps’applicator is part of a B’VARIO TPS 270, which will be delivered to our customer Baoding Shi Dahan Glass Co., Ltd. which is located near Bejing. “The request for TPS® in China is very high at the moment”, Gernot Pirnbaum, Sales Engineer for insulating glass lines in China reports. “The new finisher has been very well received.” Bystronic glass is substantiated with more than 30 years accrued warm edge spacer experience: With Thermo Plastic Spacer TPS® it is possible to achieve a peripherally tight edge seal whilst sustaining and increasing insulating glass energy efficiency – this has repeatedly been proven more than a million times over. However, it was not just the insulating glass sector which stimulated great demand. Numerous automotive glass preprocessing customers visited
Bystronic glass media contact: Iris Mittelstädt PR / Online Communications Bystronic glass c/o Bystronic Lenhardt GmbH Karl-Lenhardt-Str. 1-9 D-75242 Neuhausen-Hamberg Phone +49 (0)7234 601 120 Fax +49 (0)7234 601 114 iris.mittelstaedt@bystronic-glass.com www.bystronic-glass.com www.YouTube.com/Bystronicglass
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Shanghai, too. For many years Bystronic glass has been recognised for expertise in this sector of the industry with the champ’speed machine generation which was developed for the pre-processing of automotive glass. Almost half of all passenger cars are equipped with an automotive lite that was produced on a Bystronic glass unit. The champ’speed 2in1 version is the first machine in the world that can break automotive glass with or without a template on a single machine. At China Glass 2016, Bystronic glass presented a variety of new and improved developments to the champ’speed, via multimedia channels in the Automotive Innovation Center. Website: www.bystronic-glass.com About Bystronic glass Bystronic glass symbolizes innovation with machinery, systems and services for the processing of architectural and automotive glass focussed on tomorrow’s market. From basic requirements through to entire, customized installations Bystronic glass provides pioneering solutions – naturally, all in the highest quality. Bystronic glass is an international brand with globally operating companies that support their customers on site and through own sales and service companies. Since 1994, Bystronic glass is part of the Conzzeta AG, a renowned Swiss industrial holding company.
Bystronic glass sales contact: E-Mail: sales@bystronic-glass.com For the contact details of Bystronic glass global representatives please visit www.bystronic-glass.com
AG 16-3 asianglass
57
Anaylsis
Refractory Zone Splitting hairs In the latest of his exclusive articles for Asian Glass, P.Carlo Ratto discusses fused cast refractories, the old friends of glass furnaces, are now coming in different “flavours”…. Furnaces for primary production of glasses, and particularly for the larger volume segments (containers, tableware, float), in spite of great evolution in terms of design and productivity, are still lined with fundamentally two classes of refractories. However, although both are essentially fused-cast, they are now considered commodities. AZS and aluminas fused cast, with minor reinforcements of some critical detail (like throat inlets, covers, crosswalls, sometime DH corners) are still, in fact, those materials that constitute the melting-end and working-end glass contact, and in several cases also the superstructure. This situation, now lasting since most recent half of century, is doomed to stay for several years to come, at least until a new and revolutionary smelting technology will support the evolution of a new class of refractory (or no refractories at all!), or until some improbable development of a new class of refractories will replace AZS and or aluminas. I used the word “improbable” because under the present economical contingency (of which we do not see a short term reversal) the resources for a radical R & D development are scarce and because a new class of materials could be welcomed by the glass industry only under a significant economical justification. Given the combination of furnaces engineering and present fused cast refractories, in fact, the campaign life of advanced furnaces is getting close to the technological obsolescence of the smelting furnace as a general design, so that the motivation for further prolonging the furnace durability is losing momentum, against the purely financial stance. Having explained why we must expect having to live together for several years with our old classes of fused cast refractories, then we should be seriously interested (maybe concerned?) to understand what technical/technological evolution is going beside the commoditization, welcomed by the market for the obvious cost implications. In the ante-China era, until a quarter of a century ago, the world was leaving in an technological oligopoly, where in Europe the dominant SG-SEPR was managing the most advanced hot-strip (hs) AZS technology and in North America Monofrax was mastering a very well optimized version of non-hot-strip (nhs) AZS process. These two classes
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of technology, both with pluses and minuses, were made as effective as possible by manufacturers under a moderate level of competition in a world characterized by an acceptable level of business profitability, and therefore in a scenario leaving some space for R & D activity, not exclusively aimed to cost reduction. Then, an increased level of competition between the “big western” and, more importantly, the advent of a fierce level of price competition from a bunch of low-cost (Chinese) manufacturers have scrambled the cards in the game; the strategic counter measures of western manufacturers, on a survival stance, have included a radical cost reduction in their own process/technology and, when this proved to be not enough, they resorted to the simplification of the manufacturing process and its progressive relocation in low-cost places. Since the “nhs” process does not include a critical process step, it was considered to be potentially cheaper and more easily transferrable in exotic locations, where also exist non negligible technology protection implications. Unfortunately, the “nhs” technology implies a more complex molding technology, and this is a point that must be carefully evaluated when balancing cost and quality from a given low cost source and in general: when from a low cost plant of a major western manufacturer and also when produced by an independent (Chinese) player.
P. Carlo Ratto Chinese intervention Almost invariably, in fact, Chinese manufacturers of AZS fused cast are handling subsets of “nhs” technology, having in common a couple of initial origins and a major technology root, but all relevant to the above mentioned main family. As a consequence, the “hs” manufacturing process is only staying as heritage of a very few European plants, mostly part of the original SG-SEPR network and one presently operating as RHI-AG unit in Italy. All relocated low-cost units in China and India, and all the several independent Chinese low-cost manufacturers are in fact running “nhs” technologies. It must be noted that although generally not considered critical by glassmakers, the “nhs” technology implies a larger variability of the associated molding techniques, adopted to fulfill
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Anaylsis
The change is continuous… …but the high MOTIM-quality is permanent
www.motim.hu
all over the world
MOTIM
Fused Cast Refractories Ltd. H-9201 Mosonmagyaróvár, P.O.Box 29, Hungary, Tel: +36 96 574 100 Fax: +36 96 574 235 e-mail: fusedcast@motim.hu
Anaylsis
the two main functions of the molds: these devices, as a matter of facts, must initially contain the extremely high temperature liquid ceramic and, subsequently, control the passive thermal flow during crystallization and then release of thermo-mechanical stresses, until the cold cast is stripped out of the molding package. The second function, in fact, is not provided by casting molds, when the “hs” technique is utilized. Disregarding the qualitative implications concerning the differences between “hs” and “nhs”, what we point up here is that, within the domain of “nhs” technology, significant differences exists amid different producers of AZS fused cast who adopt different molding package designs. In an increasingly complex environment, glassmakers facing the procurement of fused cast refractories for a major furnace rebuilt, are receiving quotations relevant to materials and services with different technological profiles, from customary and new manufacturers, from traditional and relocated manufacturing sites managed by western “historical” producers and by independent suppliers; to add confusion to complication, it is difficult, without a deep knowledge of the underlying technological platform, to understand how different technologies reflect into the expected performance, glass quality and campaign life. In other words, it is very difficult, for a glassmaker without a strong specialized support, to determine the ratio risks/savings relevant to alternative options. After a long experience of supporting glassmakers’ decisions in complicated situations, I can quote a few most frequently posed questions: Q1) I am financially motivated to buy fusedcast refractories from a hard low-cost source (i.e. an independent Chinese manufacturer), of which I have a handful of different proposals. How can I know which one is offering the best ratio savings/risks ? A1) It all depends on the level of glassmaker’s project sophistication and
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asianglass AG 16-3
criticalities; it is definitely not the same story when you are a standard bottles-maker or producing perfumery bottles, or handling an all electrical opal glass furnace. Not all the hard low-cost sources are alike and a thorough analysis of the specific situation will be able to minimize risks while cashing in the best financial benefit. Q2) I am a customer of a major western manufacturer who, in the past, provided successfully fused cast refractories from a relocated low-cost source. Now the same manufacturer is offering same materials from a new alternative low-cost source; how can I be assured that this new source is providing materials and services at a qualitative level at least not inferior to the one I was used to receive? A2) Normally, such major western manufacturers provide reassurance that their relocated plants provide goods and services under corporate qualitative standards, and new plants undergo rigorous internal qualification processes before to deliver products and services to the market. In spite of this, a given glassmaker is perfectly legitimated to directly check the situation before to proceed with procurement from a new source of an old supplier. To get to the point, independent audits are available covering the general situation or to be focused on specific aspects of interest for a given glassmaker. Q3) I am a glassmaker producing items with very high and specific qualitative demands. I know that products made out of relocated low-cost and, even more, from hard lowcost sources are not exactly manufactured with same technology managed by original western producers. Does this imply different process capabilities that can reflect in differences of performance for my furnaces? If yes, how can I manage the situation? A3) Two questions require separate answers: as above said, yes, relocated plants are all running “nhs” technology, while some major western (European) plant still are running “hs” technology and, yes, this
reflects potentially in slightly different process capabilities. To quote one detail as an example, “hs” technology, separating physically the pouring mold from the annealing package, offers one additional degree of freedom, potentially allowing to manage more critical chemistries (e.g. AZS with more acidic and hard glassy phase), and therefore making it possible to offer better performances (e.g. durability) in very critical applications. When this is significantly important for a specific critical demand, then selected items can be provided out of still operational western plants operating “hs” technology. The most typical situation is when glassmakers buy AZS throats out of European plant and the rest of furnace from relocated low-cost plants of the same supplier. Selecting if and what furnace details should be selectively procured is a matter of knowledge. Q4) My preferred supplier of fused cast is quoting my BOM out of his relocated plant in China at a price higher than what I can source out of an independent Chinese manufacturer. Is there any reason for me to buy Chinese stuff from my preferred western supplier? A4) In general terms, Chinese refractory provided out of a relocated plant (of a major western company) are different from those manufactured by independent Chinese manufacturers, since in the first case the mother company provides all the technical and technological know-how in order to provide materials and (equally important) services at the level necessary to provide global guarantees. In the second case, in spite of managing the same “nhs” class of technology, the global level of technology is not certified against a world level and must be evaluated case by case; very often the independent suppliers can offer a better pricing position but, as previously stated, it is all to be balanced with the specific application and the acceptable level of risk. AZS fused cast refractories, the old friends of glass furnaces, one major resource that fueled technological evolution toward longer campaigns and much better glass quality, are still around and will be here for many more years to come. Yet the globalization of markets, the advent of eastern independent low-cost manufacturers and the subsequent commoditization of such formerly specialties is bringing about a serious number of issues for glassmakers having to make the right choice, balancing financial, safety and performance requirements. Answers are available in such a very dynamic scenario; new options are surely in the pipeline and all actors in this game must be ready to capture opportunities, and to discard excessive risks.
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20–23 September 2016
GLASS IS LIMITLESS
Typical low cost alpha-beta alumina, showing light blue discoloration and surface contamination from moulding components”
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