OPP manufacturing plant closures ‘a sign of things to come’

OPP manufacturing plant closures ‘a sign of things to come’

Jindall, a leading supplier of OPP, has fuelled growth with acquisitions both in Europe and America, according to a blog post from National Flexible.

In November 2018 the company closed the Battipaglia OPP plant in southern Italy which came with the Treofan acquisition. This plant had a production capacity of up to 50,000 tonnes.

Jindall also recently announced the closure of a second ex Treofan site in Belgium with a plated output of 30,000 tonnes.

It is suggested that they are now negotiating to close the Terni OPP site in southern Italy, once the “flagship site” of Treofan, again with a capacity of circa 50,000 tonnes.

The rationalisation of OPP manufacturing in Europe reflects the scale of investment in alternative OPP manufacturing sites further afield, particularly in the Middle East, Turkey and Eastern Europe.

However, the older European sites focussed much of their production on specialist OPP whilst the majority of production from the newer plants are commodity grades. Therefore, it is likely that these closures could affect future pricing and availability of specialist OPP films.

Interestingly, the consolidation trends in film manufacturers are reflecting a similar set of circumstances in the packaging film conversion industry.

Mondi’s closure of the Wheatley plant in Lincolnshire is simply the latest development in a trend that sees the big companies getting bigger as the independents are acquired and rationalised. As a consequence larger film converting plants are being developed.

Right now, National Flexible said it knows of another printed film site being planned for closure this year with no doubt more to follow. Whether this is good thing for the Industry as a whole, the company has its doubts.

National flexible said that it is probably manufacturing costs will be driven down and overheads reduced, no doubt leading to even lower prices for film to the multi-national and suppliers to the large supermarkets.

But in the company’s experience the larger manufacturing base the lower the service element. Eventually the production “tail” wags the sales dog.