| Tue 10 Feb 2004, 11:54 | | Sappi urges firms to lift paper bag output |
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Sappi urges firms to lift paper bag output
February 10, 2004
By Margie Inggs
Durban - Sappi had suggested that packaging companies increase production of consumer paper bags as a substitute for plastic, but expressed disappointment at the poor progress of talks, according to Jonathan Leslie, Sappi's chief executive.
Speaking in an exclusive interview after presenting the group's global award to Sappi Saiccor last week for its 76 percent improvement in lost time because of injury, Leslie said any move towards increasing paper bag production would depend on improving the strength and quality of paper.
Sappi already supplies packaging companies with the raw material used to produce paper bags for niche products like charcoal, cement, dog food, maize and sugar, and had recently upgraded its equipment to improve the quality and volume of its raw material for this market.
Its product is also in demand for designer boutiques, jewellery bags and gift carriers.
John Bortolan, the managing director of paper and plastic bag producer Nampak, confirmed the groups worked together to explore new market opportunities, but said paper bags were not a cost-effective alternative as plastic bags were thinner and cheaper to produce.
"Consumers prefer plastic because it does not break as easily and provides better protection against the weather. However, non-wovens have become popular as a substitute because they last longer and are fairly cost-effective," he said.
There was likely to be consumer resistance to paper bags as they would cost more at the point of sale.
Bortolan said Nampak would continue to look for opportunities to expand its niche paper bag markets.
Andre Oberholzer, Sappi's head of corporate affairs, said the group worked closely with converters on the technical characteristics consumers wanted from paper bags and had already strengthened and waterproofed its raw material, but cost remained an issue.
"However, certain markets such as fast food and bakery products prefer paper bags, which do not cause sweating," he said.
BP garages have also switched to paper bags.
"Paper bags will always be a small part of the market but Sappi will be able to meet demand as it increases," Oberholzer said.
The awareness created by government legislation on plastic bags had created a high demand for alternatives and Oberholzer said Sappi would help provide a choice for consumers.
Arnold Vermaak, the managing director of Afripak, which focuses on manufacturing paper bags and sacks, said brief, informal discussions had been held with Sappi.
"The issue boils down to cost, so paper manufacturers would have to find a way of reducing the raw material price for mass market production," Vermaak said.
Afripak would be interested, but the strategy would have to be led by paper manufacturers, as expensive dedicated equipment would be needed for mass production.
"Ideally, Afripak would like to set up a joint venture company with Sappi with black economic empowerment involvement."
Leslie said any growth in paper bag production would make only a modest contribution to Sappi's bottom line. The company focuses on fine paper for glossy magazines and brochures that account for over half its profit.
Sappi closed R1.20 lower at R94.
