Metals in Packaging A Strategic Market Outlook to 2015

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1 What is the short and long-term outlook for metals packaging compared to its competitors? What are the future trends in demand, capacity and pricing? How is profitability measured? Do can-makers receive a fair return on their investments? Can steel mills add value by moving into can-making? What is the outlook for can-makers stuck between raw material giants and what will their strategic response be? What does further consolidation mean for the industry? Is ability to recycle a key advantage for metals? How can this be exploited? NEW Metals in Packaging A Strategic Market Outlook to Tel: +44 (0)

2 For more than a decade, Metal Bulletin Research (MBR) has provided regular and insightful research on the aluminium can-stock and tinplate industries. Its leading analysts and economists are therefore able to utilise their unrivalled knowledge to bring you Metals in Packaging - A Strategic Market Outlook to Metals in Packaging is a unique, detailed and completely independent study of the tinplate, aluminium and metals packaging industry. As two of the key raw materials used for packaging, steel and aluminium are under pressure from substitutes in glass and plastics. Yet both have responded to these pressures through innovation over the last decade and with more to come. Compiled over a six-month period, the study examines the demand for can-making materials and cans in all significant regions of the world. How the industry is tackling the green issues of resource reduction, recycling and emissions is examined, with emphasis on the technical aspects and the favourable economics. The study covers technical, production and economic aspects, so that it is relevant to all those involved in the industry, providing a review of the past and forward projections for the future. This is essential reading for those looking for an insight into this complex and under-researched industry. This study is the first research report that provides an overall perspective of where the metals packaging industry is now, how it got there and where it will go in the future. It applies a critical perspective to the industry, analyses the respective strengths and weaknesses and provides a reasoned outlook on future developments. With a minimum 50/t rise, the business will break even. The rising costs of raw materials to produce tinplate, particularly tin, make this rise unavoidable. Today s European DWI price does not correspond to that of hot-rolled coil, which exceeds 500/t - a price to which a transformation cost of /t must be added. Spokesman, Arcelor Mittal The fact that we have been able to go to the very limit of our capacity is due to lively demand from our customers, says Rasselstein director Karl-Ernst Friedrich, adding that the company has had to turn down requests for more material. Karl-Ernst Friedrich, Director, Rasselstein...what is the independent expert view?

3 How is tinplate profitability measured, and what does further consolidation mean for the industry? Operating Cost Curve for tinplate producers 2007 What are the future trends in demand, capacity and pricing for tinplate and aluminium can-stock? What is the future for aluminium foil and its markets and how does this differ from aluminium can-stock? How do the local and global requirements for metals packaging differ and how can companies take advantage of this? Does the added value of tinplate exceed that of other flat rolled products for the steel mills? How far can light-weighting go, and will the end of this trend lead to a greater demand for metals packaging in volume terms? How do steel and aluminium compete, particularly in the beverage can market, but also in aerosol and food can markets? How should investment plans be tailored, and is consolidation the way forward, or will the local niche plants survive? How is the industry reinventing the image of the can to maintain its vital role in food preservation? Metals in Packaging is essential reading if you: Are looking to invest in the industry Are responsible for planning your business strategies Need to know the winning strategies you should adopt Want to understand changes in the market and how they will affect you Need to learn how individual companies interact Would like an overall perspective of the metals packaging industry Want to know where the industry will go in the future Tinplate per capita consumption in 2005 The study includes: Market share analysis including beverage can lines by owner/region and cross-country recycling rates. Can-maker ranking by-region and by market sector. Detailed by-country steel beverage, food and aerosol can production and forecasts out to SWOT analysis of all major metals packaging manufacturers along with commentary on their future strategy out to Detailed by-regional cost comparison between tinplate and aluminium in various packaging applications and sensitivity analysis of the impact of changing variables on total costs of production. By-country historical and forecast tinplate capacity, production, utilisation rates, net trade and apparent consumption statistics out to Can foil sales forecasts by region out to Review of all major technological trends and identification of key future developments along with their impact on demand and supply. Analytical price coverage of tinplate/aluminium spot, contract and prices delivered to merchant collecting centres as well as tinplate, aluminium, aluminium can stock and substrate price forecasts out to 2020 with full price-margin analysis....where are the next growth areas likely to occur?

4 Order Metals in Packaging and qualify for a 20% DISCOUNT ON METMARK SOFTWARE As utilised in Metals in Packaging, METMARK is a unique software program that provides a detailed cost model of all aspects of beverage can manufacture, from input metal to finished body and easy-open end. There are almost 1,000 cost variables incorporated in over 35 analytical tables allowing the user to calculate various what-if cost scenarios to assist in developing overall business strategy. For example, if you are looking to buy a (can) press machine which is on sale at US$1m, with Metmark you can easily calculate the value of this machine by working out the amortisation time, taking into account various changes in efficiency, production speed, spoilage rates, power consumption, etc. The default data may be adjusted for different can dimensions, types of metal, decoration and inside coatings, labour costs and line speeds - all aspects of manufacture to fit the circumstances surrounding your own region of production. The unique programme does all of this with just a few key strokes. For more details regarding the full programme go to Biographies of authors: Brian Levich Head of Research, Metal Bulletin Research UK Brian specialises in the steel and raw material sectors. He has written numerous major studies on the global steel industry and has done extensive consultancy and market research work for a number of major steel producers, consumers and financial institutions. Philip Rogers Philip Rogers is a Chartered Engineer, a fellow of the Institute of Materials, Minerals and Mining of the UK, and is a Cambridge University graduate. He is an independent consultant to the packaging industry specialising in tinplate and aluminium, the actual use of the material by the can-makers and fillers, and the economics surrounding the industry. As well as consulting work he has published several books studying the technical and economic aspects of the industry. He worked for 20 years in the flat rolled steel industry in South Wales, and in particular in the production of tinplate. He then moved to work at Metal Box s Research and Development Centre at Wantage, UK where he led the Metallurgy team, working on the use of tinplate and aluminium in can-making, and the economic aspects of purchasing. Edgardo Gelsomino Aluminium Research Manager, Metal Bulletin Research UK Edgardo Gelsomino has over 10 years experience within the aluminium and raw material sectors, contributing to and managing various regular and long-term consulting assignments involving business analysis and financial modelling. He was previously employed by ALUAR Aluminio Argentino. Edgardo holds a degree in Economics from the University of Buenos Aires and is Metal Bulletin Research's Aluminium Research Manager. Nick Fellner Following a long career with American Can Company, and canmaking responsibilities in the United States and South America, Nick Fellner has developed the METMARK software cost model for can manufacturing analysis. He combined an education in physics, extensive can-making experience, computer know-how, and a working relationship with the world s leading tinplate and aluminium producers to produce a computer modelling programme readily usable for steel and aluminium executives. It has been used by major companies in South Africa, England, France, Germany, Switzerland, Japan, Australia, and many other nations.

5 CONTENTS GLOSSARY EXECUTIVE SUMMARY CHAPTER 1 THE MARKET FOR METAL CANS Packaging background The world packaging market Tinplate use in the world packaging market The place of metal in the world packaging market Summary Forecast consumption CHAPTER 2 THE COMPETITIVE ENVIRONMENT FOR METAL CANS History of can-making and materials Advantages of the metal food can Can-making technology Development of the beverage can market Development of the food can market Tinplate cans Aluminium cans Development of the general line can market Closures Dry food packs Non-food packaging Fancy boxes Image of the can CHAPTER 3 PRODUCTION PROCESS AND QUALITY RANGE Materials Production routes and material specifications Tin-mill products Yields Dimensions Chemical and mechanical Surface specifications Coating options Aluminium products Casting and rolling options Metallurgical restraints Finishing options Yields Foil CHAPTER 4 TINPLATE AND CAN-STOCK ROLLING MILLS Tinplate capacity Tinplate producers Tinplate consolidation Stand-alone tinplate mills Future developments Aluminium can-stock capacity Product range Future developments CHAPTER 5 ALUMINIUM CAN-STOCK AND TINPLATE OUTPUT Aluminium can-stock Impact of light-weighting Tinplate Tinplate output forecasts to 2015 CHAPTER 6 ALUMINIUM FOIL Applications Output Forecasts CHAPTER 7 PRICING OF TINPLATE AND ALUMINIUM CANS Tinplate pricing Aluminium pricing Tinplate vs aluminium for beverage cans Tinplate cost analysis Pricing impact on can costs CHAPTER 8 METAL PACKAGING IN THE CONTEXT OF CONSUMER PACKAGING INDUSTRY Consumer packaging companies Consolidation and concentration in the packaging markets Outlook for consolidation CHAPTER 9 RECYCLING Economics of recycling Tinplate Beverage can recycling Recycling methods Legislative impact and developments Deposit schemes Blue Box schemes Aluminium recycling Recycling data Europe USA Japan South Africa Other markets Value of metal units Is recycling sustainable? Non-government initiatives Sustainable Packaging Coalition International Council on Mining and Metals Wal-Mart Energy-impact and carbon footprint Conclusions and outlook CHAPTER 10 CAN MARKETS AND OUTLOOK USA Other non-food cans Europe China General line Brazil Tinplate Aluminium Russia India CHAPTER 11 TECHNOLOGY TRENDS Major drivers Food can technology developments Beverage can technology developments General line technology developments Aerosol technology developments CHAPTER 12 OUTLOOK AND FORECASTS (WILL CANS REMAIN COMPETITIVE?) The competitive environment for metal cans Cans in the 21st century Tinplate and aluminium supplier developments Developments in technology Consolidation in the packaging industry Recycling Technical developments Future strategies Pricing outlook Tinplate price forecasts Tin price forecasts Aluminium price forecasts