Tinplate prices on the rise in India

Metal Container Manufacturers Association of India (MCMA) has expressed serious concern relating to an approximate 8% increase in tinplate prices by a local producer, which it believes are abnormal and unjustified. MCMA believes that this has been done primarily to benefit from adverse rupee dollar parity in the last two months, in which the landing cost of imports has gone up.

The major cost component for production of tinplate is hot rolled coil, which is produced locally. Internationally, the HR Coil prices have been stable at around $550 (£345) per metre, but there has been a declining trend since April 2013 and only nominal increases in the months of August and September. The domestic HR prices, meanwhile, have been increased by about 2000 Indian Rupees (£20) per metre.

The company believes that the change in Rupee Dollar parity – particularly in July and August – resulted into a substantial increase in the landed international price. Additionally, in the 2012 budget, the Indian government increased import duty on tiplate from 5% to 7.5%. As a result of these factors, prices for tinplate in India have increased by approximately 10% since April 2013, from which around 8% was from October onwards.

Tinplate accounts for approximately 60% of the cost of a metal can, and it is anticipated that the ‘abnormal’ increase by the local producer will hit the metal packaging industry adversely as it is already struggling with the lowest growth in the packaging segment due to shift of various products to alternate packs.

Sanjay Bhatia, president of MCMA, has appealed to the domestic producer to review the ‘unjustified’ increase in the tinplate prices, keeping in mind the declining trend in tinplate price globally and nominal increase in HR coil prices locally. The Metal Packaging Industry has protested against such an increase and called for the government to completely withdraw the import duty on tinplate; noting that it is difficult for the industry to absorb such a heavy increase, as this is likely to result in closure of various small and medium companies in the metal packaging sector. MCMA has appealed to various ministries to intervene in the matter.