Nampak Ramps Up Aluminum Cans in Response to Plastic Backlash

(Bloomberg) -- Nampak Ltd. is ramping up production of aluminum cans as Africa’s biggest producer of beverage packaging responds to consumers’ global retreat from plastic.

The Johannesburg-based company is also putting greater emphasis on cardboard cartons and developing a type of renewable plastic lid made from sugarcane, Chief Executive Officer Andre de Ruyter said in a phone interview. That’s due to a growing concern about the impact of plastic on the environment, particularly on items such as single-use straws.

“Consumer sentiment against plastic packaging that cannot be recycled is very clear,” de Ruyter said. “Aluminum is a valuable metal and so people have incentive to recycle it.”

Nampak and other container makers are able to boost aluminium-can production alongside expansion into fast-growing regions such as Africa, where demand for canned and bottled drinks is rising as people start to buy packaged goods for the first time. Nampak is spending 100 million rand ($7.2 million) on a new food-can line in Nigeria, while that country’s GZ Industries Ltd. is opening a factory in South Africa.

Nampak shares declined 5.1 percent to 14.75 as of 3:40 p.m. in Johannesburg, after the company announced a 7 percent rise in full-year operating profit. The firm resisted a resumption of dividends due to a long-standing issue transferring cash from Angola and Zimbabwe and an ongoing effort to sell its glass business.

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