Case-study: How Shetron made cans against all odds

Shetron Limited is bullish even though it has been affected by the impact of securing tinplate and tin-free steel due to the imposition of BIS standards; plus the trickle-down effect of the Omicron virus. Today, most of the metal packaging industry belongs to the MSME sector, therefore, they are affected due to working capital constraints which have happened because of the increase in domestic prices of tinplate / tin-free steel by almost 100%.

In spite of all the odds, Shetron continues the good work; including bagging awards for its metal can innovations with easy-open end and full-aperture openings

20 Aug 2022 | By Venu Ayyar and Janhavi Sisodia

First things first. As the Metal Containers Manufacturers' Association data states, "The total metal packaging market is estimated to be worth USD 111,862 million in 2020, and USD 130,652 million in 2025. This is a CAGR of 3.2%. The total can market is projected to be worth USD 65,446 million in 2020 and USD 76,038 million in 2025, a CAGR of 3.0% to 2025."

Ideally this should be good news for the metal can industry. However the pandemic months saw huge challenges due to logistics and sourcing of main raw material (tinplate), volatile pricing and availability. Due to the introduction of BIS standards and approval procedures, import of regular steel supplies from Japan, China, Korea, Taiwan, Europe etc. has been restricted.

In spite of all the odds, Shetron Limited kept top priority to take care of health issues of employees inside the plant as well as outside. There is a clear shift from plastic packaging towards metal cans, as a result, the demand for metal cans has increased due to the factors like safest packaging, long shelf life, eco-friendly and recyclability. This has resulted in an increase of demand from organised sectors.

One reason for the healthy numbers is that Shetron has initiated industrial packaging for non-agro products and non-seasonal products. It is expecting growth in this segment over the period.

The Shetron journey
Shetron Limited was founded in 1980 and began production in 1984 with dry cell battery components and jackets. Later, metal cans and ends were added to the manufacturing portfolio in the early 1990s. Shetron expanded their product line with twist-off caps. The most recent addition to their basket was conipail. The operations include two factories in Bengaluru and Mumbai.

T Nagaraju, vice president operations and plant head at Shetorn said, "Metal can production can be broken down into four simple steps: first, the raw material is inspected, next it goes through coating and ink printing, and lastly, manufacturing begins in the can-making machines. Once it's finished, all the ends are seamed, and it's ready for packaging and delivery."

Nagaraju added, "Shetron's technically qualified and experienced workforce distinguishes it in the business." Also, the company has a well-established in-house laboratory with a robust quality control system.

Shetron's strength lies in its high quality cans and delivery systems which ensures it is the preferred supplier. Nagaraju says, "The demand for our products is growing. We have long-term client ties with many of our customers, and our on-time delivery is an added benefit for most of them."

Today, metal is tapping more into beverages through can packaging compared to food. Shetron is looking at advanced packaging since it is advantageous in new category beverages such as ready-to-drink (RTD) beverages. The application of metal packaging in the beverages industry is expanding at a CAGR of 3.4% through 2025. 

Shetron's USP
Shetron's USP is that they have a sophisticated in-house tool room where they create dies which are based on client specifications. Nagaraju says, "Toolings hold the key. We can create complicated dies in a short period of time - and fulfil the customer's requirements. Also we have a well-established coating and printing line where we employ high-quality inks and coatings to reduce shade fluctuation issues." Since inks are crucial to the process in the metal can industry, inks and coatings play a vital role, keeping this in mind they use the right kind of ink alkyd base, and coatings polyester/ epoxy-based.  

Polyester-based coatings, according to Nagaraju, offer superior scratch resistance and tooling qualities, but they are more costly than acrylic coatings. While acrylic coating is less expensive, it lacks scratch resistance and tooling qualities. For all coatings, the company follows US FDA Regulations 175.300 and EU10-2011 plus BPA-NI EU 213/ 2018.

Sustainability holds the key. And there is a huge rise in demand for sustainable products. Nagaraju says, "Convenient packaging will drive the market demand and growth of beverage cans. Covid-19 has had an impact on the food supply chain in all regions. Due to the spread of Covid, there has been a growing number of mortalities and long-term health impacts. Nagaraju says, "The recyclable and reusable properties of cans act as an important driver for the growth of the beverage cans market. Almost 90% recyclability of both steel and aluminum cans makes them eco-friendly." 

Also it helps can-users in obtaining a cost advantage in packaging while at the same time addressing concerns about disposability, as they are manufactured in accordance with environmental regulations for decomposition.   

Today, the global metal packaging market is projected to reach USD 147.4 billion by 2030, growing at a CAGR of 3.1% from 2021 to 2030. This is one of the main reasons Shetron's clientele is not limited to India. They do business in Canada and Australia, Mexico, South Africa, and many more countries. In 2021-22, the export turnover was Rs. 4,945 lakhs as compared to the previous year exports of Rs. 5,465 lakhs.

High growth in metal cans
As per IIP, the packaging per capita consumption in India is 8.7 kg which is low as compared to Germany which is 42 kg and Asian countries like Taiwan which is 19 kg.

Shetron believes that  the packaging industry is one of the most vital growing sectors in the country owing to the rising population, increasing income levels, changing lifestyles, modern retail, and increased media. The market's swift growth is driven by pharmaceuticals, foods and beverages, decorative paints, etc. With top brands making investments across sectors such as food processing, personal care, paint and pharmaceuticals, end-user industries generate opportunities for growth of the packaging market, which has grown more than 10% p.a.

Reports by the retail association indicate that in the current times of Covid-19 more opportunities for packaging of food products for longer shelf life, sanitisers and disinfectants in aerosol cans etc. are being created. Nagaraju says, "However, the competition from paper and plastic packaging poses a challenge to the metal packaging market."

Which is why, Shetron is committed to investments in canned packaging R&D. Innovations, such as reduced surface area without affecting the volume, have resulted in lowering the cost of packaging of metal cans, thus, supporting companies in lowering packaging expenses. Also consumer trends, such as smaller size consumption and multi-pack consumption, are supporting the volume growth of the cans in the US and Europe, while similar trends have been observed in the Asia-Pacific region. The growing demand for mini-cans is expected to influence the growth of the market.

Nagaraju concludes, "Due to growing environmental awareness, consumers are demanding metal cans as they have a lower environmental impact. High recyclability of metal is one of the key drivers of the market. The economic conditions and lower pricing of canned goods in some regions remains a key driver in the market." All in all, good news for Shetron.