After years of steady growth, beverage can makers like Crown Holdings and Ardagh Metal Packaging are facing headwinds from soaring aluminium costs and a demand slump in Latin America.
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Crown Holdings said its beverage can volumes in the Americas slipped by about 5 per cent in the latest quarter, reversing the strong gains made last year. The fall was more pronounced in Brazil and Mexico, where sales were down around 15 per cent, according to Chief Executive Tim Donahue.
Passing on aluminium price increases - reportedly up by 54 per cent globally - to customers through existing supply agreements, Donahue said he expects volumes to pick up again by 2026, noting that canned drinks continue to offer consumers an affordable treat during tighter economic times.
It’s a mixed quarter for Ardagh Metal Packaging
The company reported a 1 per cent drop in global can shipments year-on-year. Although the situation is slightly better in Europe, demand in the Americas fell by 3 per cent. North American shipments grew marginally, while Brazil saw a sharp 17 per cent fall.
Chief Executive Oliver Graham said the weakness affected both beer and soft drink categories. However, he added that non-alcoholic canned drinks remain a bright spot, especially in North America.
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Beer market outlook remains bleak
Research by Circana suggests that nearly half of US consumers plan to cut back on alcohol in early 2025. Major brewers are already reacting to this trend. Molson Coors said it will reduce about 400 jobs in the Americas and shift focus towards premium mixers, non-alcoholic beverages, and energy drinks.
Constellation Brands, which makes Modelo, reported a 7 per cent drop in sales and weaker beer demand, while Heineken’s revenues in the Americas fell over 5 per cent as volumes slipped more than 7 per cent. Even so, Heineken CFO Harold Broek said cans continue to be the preferred packaging among drinkers and remain central to its growth plans.
Coca-Cola adapts with new packaging solutions
However, the non-alcoholic drinks market remains relatively firm. Coca-Cola posted a 5 per cent rise in third-quarter revenue, supported by packaging innovation and flexible planning. CEO James Quincey said the company has been making efforts to cope with the changing conditions while keeping investment steady. At present, Coca-Cola is testing its duo pack in Brazil and expanding its USD 1 billion mini can range to accommodate the budget buyers.
Industry rethinks formats to meet new market possibilities
With a demand shift across regions and categories, beverage can makers are now significantly rethinking their production strategies to keep up with the trends. This involves a major shift in packaging formats focused on innovation and sustainability, while addressing rising material costs.
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