Industry organisation MetPac-South Africa (MetPac-SA) says the five-week Level 5 lockdown in South Africa constrained the usual material recovery processes and will impact on the recovery rates of metal packaging, and post-consumer packaging material in general, for the rest of the year.
MetPac-SA is in the process of reassessing its operational targets and may also need to adapt its funding and operational models. It is currently preparing a Section 18 response document to demonstrate the industry’s ongoing commitment to Extended Producer Responsibility, which will be submitted to the Environment, Forestry and Fisheries Minister Barbara Creecy for consideration.
"It is clear that business has been badly disrupted and we are now preparing for the new normal. The packaging industry as a whole is likely to face dramatic changes, such as new consumption patterns, changing consumer demands and end-of-life packaging solutions.
“However, this should also be regarded as an exciting opportunity for metal packaging. Change is the only constant and is the law of life. If we only look to the past or present, we run the risk of missing the future,” says MetPac-SA CEO Kishan Singh.
Prior to the Covid-19 lockdown, South Africa’s collection and recovery rate of post-consumer metal packaging – usually containing aluminium and tinplate – was estimated at 75.8%.
“Although recyclable waste was still collected out of some neighbourhoods during Level 5 of the lockdown, waste management companies, scrap merchants and organisations such as Collect-a-Can were unable to process or sell the waste to recyclers.
“Also of great concern was the plight of informal waste pickers and reclaimers who were suddenly unable to collect materials and left without an income,” notes Singh.
The organisation and its members, including Packaging South Africa and producer responsibility organisations raised R785 000, together with the Department of Environment, Forestry and Fisheries, to buy electronic food vouchers for registered waste reclaimers.
It is still too early to calculate the full impact of the lockdown regulations on the metal packaging industry and MetPac-SA expects it to become more apparent during the second half of the year.
With the alcohol sales ban in South Africa, it has caused a dramatic drop in the demand for beer and other alcoholic beverage cans; however, it has helped that there was a slight increase in the demand for some canned food as shoppers stockpiled long-life food and pantry staples.
The current over-supply of recyclable materials that have been stockpiled by waste management companies and scrap merchants during the five-week quarantine period will now result in a saturation of the local market for the foreseeable future.
“Unfortunately, lost manufacturing time cannot be regained. Local can makers will not be buying more recovered material until at least July this year and, if waste collectors cannot sell their materials, they will not be able to generate much-needed cash inflow for their businesses.
"In addition, much of this valuable resource, now surplus in South Africa, may end up as waste in landfills” Singh says.
He explains that despite its benefits and versatility, the local metal packaging sector is being forced to adapt to a rapidly changing business climate and an unpredictable future.