Rio Tinto says China’s beer packaging shift will boost aluminium can consumption

The global mining and metals industry giant Rio Tinto Group has acknowledged China for boosting the use of aluminium cans in the carbonated beverage packaging sector.   

“In the packaging sector, especially around soft drinks and beer in China, we’re seeing a shift from glass to aluminum,” Rio Tinto Aluminium Chief Executive Officer Alf Barrios said in an interview recently.

Aluminium demand will rise at a CAGR of 4 per cent over the next five years, and global consumption of refined metal- at 3-4 per cent per annum rate during 2018-2019, observed Barrios. With China implementing production cut policy, the price gains in the primary aluminium vertical will flow down the value chain thereby incentivizing Chinese packaging companies to add new capacity elsewhere.

The shares of Chinese breweries rose on Monday after both UBS Group AG and Goldman Sachs Group Inc. issued reports saying they expected an industry-wide price hike. UBS estimates annual profit for the sector will grow at 28 per cent rate from 2018 to 2020 as demand recovers all across the market.