The pandemic has enabled a lot of product innovation. Can you highlight the difference in the products you are manufacturing compared to pre-COVID times?
The packaging of beverages has become important after COVID-19, owing to safety concerns. The glass packaging industry is seeing increased demand from the food and beverage and pharmaceutical sectors as the COVID-19 pandemic has led to a higher demand for medicine bottles, food jars and beverage bottles. About 90% of the glass containers are used for food and beverage packaging. The demand for glass packaging from cosmetics and perfume manufacturers, which are seen as luxury items, also remains strong.
AGI glaspac strives hard to bring in the latest technologies, which will be beneficial and safe for users. Amid the pandemic, we are also giving priority to hygiene and safety. Our R&D department has developed an anti-bacterial range of bottles using advanced Germ Guard and Active Silver Technology. The bottles have the following characteristics:
They are inorganic in nature
They are highly safe, non-toxic and non-corrosive
They have the stability of up to 1300oC
They destroy 99.99% of bacteria, along with other germs
Can you explain the changing dynamics of global packaging amid the pandemic? What are the changes and opportunities for India in this market?
The COVID-19 pandemic has created a major disruption in the packaging sector. With the increase in the awareness of sustainable packaging among consumers and industries, there will be huge scope for growth in sustainable packaging. Amid the lockdown, consumers are now more focused on adopting a healthier lifestyle and have switched to the online market. With the impact of the pandemic, there has been a disruption in the supply chain of raw material and finished goods, which has led to the implementation of a more flexible supply chain. There is considerable scope for the improvement of sustainable packaging in the pharma industry. Manufacturers are now adopting effective packaging techniques.
In India, the packaging industry is expected to register a CAGR of approximately 26.7% during 2021-2026. The industry’s growth is largely driven by various logistic applications, technological advancements and the development of the packaging sector across the country.
How does AGI Glaspac prioritise manufacturing sustainability?
In AGI, sustainability is one of our key corporate values inspiring our employees every single day as they go about their work. We strive hard to create sustainable value through our digital transformation efforts across industries and geographies. Our initiatives include:
Solar power facility: As a part of our sustainability strategy, we have added a renewable power source, solar energy, to our consumption portfolio. We have successfully installed a solar rooftop and ground-mounted solar power plant for 8.5 MW power capacity. The system is ‘On-Grid’ and connected directly to our system. Annual estimated energy generation is 12,264 Mwh. These systems are future-ready and are gaining significant popularity as a viable means to reduce carbon emissions. Solar energy generation is not only contributing to green power generation but also helping us in rationalising the energy cost. We are planning to set up an additional 8MW power capacity for the facility shortly.
Waste heat recovery from furnaces: At present, we use regenerators for waste heat recovery from the furnace. These generators potentially generate around 500 kW to 700 kW of electricity.
ESP to reduce emissions from furnace: AGI’s ElectroStatic Precipitator (ESP) is a filtration device that removes fine particles, like dust and smoke, from a flowing gas. It is designed to maintain Suspended Particulate Matter (SPM) concentration within permissible limits specified by the State Pollution Control Boards.
Water recycling plant: Wastewater recycling helps us to minimise the environmental footprint. Recycling and reusing existing water and wastewater are crucial to protect our precious resources for domestic, agriculture, commercial and industrial needs.
AGI’s natural gas supply facility: AGI glaspac had entered into an agreement with Bhagyanagar Gas Limited and Gujarat State Petroleum Corporation for the supply of natural gas to Hyderabad and Bhongir, respectively. With these efforts, AGI is moving toward reducing the carbon footprint.
Our glass manufacturing sector was valued at $2 billion in 2020. What is the growth expected and some major trends in this sector in the next five years?
The glass industry in India is quite old and well established. It remained largely a cottage industry for a very long time. In recent years, the industry has transformed from using rudimentary mouth-blown and hand-working processes to adopting modern processes and automation in a big way. However, Indian per capita consumption for glass packaging (1.8 kg) is much lower compared to other nations. The following graph shows it:
The demand for glass packaging is expected to grow exponentially in the coming years. AGI glaspac has already installed the additional capacity to meet the rising demand. The Narrow neck press and blow (NNPB) process can produce the best glass bottles. The current trend is towards tempering, using appealing colours and other value additions that will overcome the shortages, if any, and create a good supply chain for the consumer. The industry is experiencing a surge in demand, owing largely to the growing purchasing power, urbanisation, modern retail and increasing awareness about health and hygiene among consumers.
Glass containers have been a direct substitute for plastic containers. With plastic phasing out in the coming years, the demand for glass bottles is expected to increase substantially. Also, it is observed that even end consumers now prefer glass over plastic. When it comes to prices, only if the raw material cost increases, the price of the glass bottles is also expected to rise. However, it is also crucial to note that all these estimates were made before the COVID-19 pandemic. Hence, it is a possibility that the current pandemic situation may bring unforeseen changes to these reports.
Can you elaborate on AGI’s expansion plans for the long- and short-term?
The novel coronavirus crisis has already led to some of the sharpest declines in recent times in demand for certain types of packaging. These include flexible films in the snacks industry, glass and metal in the alcohol industry while accelerating growth for others — such as packaging for e-commerce shipments like flexible, rigid plastics and corrugated grocery packaging that are emerging as lifelines in this new world. Yes, there will be a downfall as many packaging companies cannot increase their production as per the high demand will not be able to sustain in the market after the pandemic is over.