Despite having adequate capacity to manufacture tinplate to meet domestic demand, India imports 35-40% of its requirement of tinplate, much of it of low quality that finds its way into food packaging.
The genesis of the idea of tinplate cans made from steel sheets with a tin coating has a history of more than 200 years. They evolved as armed forces sought a way to preserve and carry rations for their military campaigns. Tinplate was chosen as the packaging medium due to its excellent barrier properties (oxygen, bacteria, and sunlight), mechanical strength, high shelf life, and ability to retain the nutritional values of food.
The canned food revolution really took off after technological advancements led to manufacturing, filling, and re-closing cans at high speed. It became possible with the modern steel companies investing in developing thinner and stronger steel making the cans lighter.
The product of war from two centuries ago has now become a subject of a battle in India over tariffs, duties, and quality standards. When used for packaging food, higher-grades of tinplate are recommended by regulators, including the Food Safety and Standards Authority of India (FSSAI), as low-quality tinplate may contaminate food.
Despite having adequate capacity to manufacture tinplate for Indian demand, India imports 35-40% of its requirement of tinplate, much of it of low quality that surely finds its way into food packaging. Nearly 70% of tinplates used in India are for packing foods and 80% of imports by India are non-prime and low quality. In fact, nearly 25% of the non-prime low-grade tinplate produced globally is dumped into India every year, causing severe health and safety hazards to a large population.
Quality control order
Cheap grades of tinplate are banned in developed economies, and as a result, they get dumped in India. The government of India had sought to prevent the use of non-prime tinplate in food cans through the Steel and Steel Product Quality Control Order (SSPQCO) dated 17 July 2020. The implementation has, however, been deferred twice.
Around 145 Indian standards have been notified under the Quality Control Order covering various carbon and alloy steel products. While these orders for some steel categories were issued as early as 2009, standards for tinplate have been delayed. This, despite instances of the use of low-grade tinplate food packaging coming to light.
An anti-dumping investigation, carried out by Director General (Trade Remedies) in 2020, not only corroborated the above facts but also found that imports were being dumped into India at unfair prices causing damage to the domestic tin-mills and had since proposed anti-dumping duty ranging between $222-334 per tonne on tinplate imports from countries such as the US, EU, Korean Republic, and Japan (except Nippon steel). The anti-dumping duty recommendation has not been implemented.
Domestic capacity
While tinplate demand in India was around 0.6 million tonnes in FY 2020-21, domestic installed capacity is at 0.73 million tonnes, which is more than enough for domestic demand. The virtual free access to the Indian tinplate market for cheap imports has led to Indian tinplate mills running at 70% capacity. In the last three years, it has also led to the closure of close to 0.15 million tonnes of indigenous capacity.
In line with the government’s ‘Atmanirbhar’ initiative, the domestic industry will be adding another 0.29 million tonnes of fresh capacity by the end of the financial year 2021-22. Not finding buyers in the country, the Indian manufacturers have tried to diversify by exporting 15-20% of their production, meeting global benchmarks.
Tinplate is a recyclable and sustainable packaging material and the Covid-19 pandemic has underlined its importance and demand for packaged food cans has surged. The food processing industry has also got a boost.
However, the rampant use of cheaper non-prime tinplate continues to be a dampener in India, posing a threat to the health and safety of the Indian population at large. It is time for India to recognize the threat and take necessary action to ban the usage of non-prime tinplate, like other developed economies.
Author: RN Murthy, chairman, Indian Tinplate Manufacturers Association