Economy, Business And Markets

Investment Opportunities Series: Beverage End Production Line

Investment Opportunities Series: Beverage End Production LineInvestment Opportunities Series: Beverage End Production Line

Metal cans are designed to hold a portion of food or liquid, with the top end removable by pulling off the ring attached to it, which provides easy access to the content without causing any injury.

Imagine the sheer volume of cans required by the food industry and one could conceive the extensive demand for this commodity and its various parts such as the beverage ends.

The Persian daily Forsat-e Emrooz recently published an article on setting up a beverage end production line and the sector’s investment potential in Iran.

“The beverage end market badly needs investment to meet the demand in canned food industry,” said Shahvalian, a food industry expert.

Currently, only five factories in Iran produce beverage ends, with most of their machinery from the United States or Germany.

This is while the annual domestic demand for this simple tool stands at 1.4 billion, with 250 million of it consumed solely by the canned fish and tomato paste production industries–two of the largest food sectors in Iran.

According to Shahvalian, domestic producers are only capable of meeting 60% of the overall demand, while the rest is met through imports from China, Taiwan and South Korea.

What makes investment in this sector even more lucrative is the fact that the price of aluminum and steel sheets–the main raw materials used in the production of this packaging material–is on a downward trend, potentially reducing the production costs, said the industrial expert.

The expert noted that close to $1.3 million in initial capital are required to purchase a plot of land, set up the production line with European pressing machines and employ close to 50 workers.

“It might sound like a hefty investment, but in addition to the high domestic demand, one should also consider the profits that can be reaped by exporting to regional markets, especially Turkey,” said Shahvalian.