The future of the glass industry: modernization and prospects

08.10.2019
The future of the glass industry: modernization and prospects

Since ancient times, a glass bottle has been a reliable container for the food industry. Despite its fragility, it stands out from other packaging with several advantages. Firstly, it is environmentally friendly and hygienic. Any product can retain its useful properties for a long time inside the glass, which protects it from the effects of the external environment, as well as from oxidation by harmful materials from the inside. Secondly, it is a possibility of processing, which makes glass popular and economically viable. Along with this, there are other important advantages of glass over other containers: tightness, preservation from exposure to oxygen, the ability to take any form, which can distinguish your brand, and much more. Well, one of the most important indicators today is the ability to easily sort among other waste. In general, the benefits are obvious. Well, Vatan Abdurakhmanov, General Director of Northern Glass Container Company, will tell us more about all this.

- Vatan, despite scientific and technological progress and new developments in the food industry, glass containers can never be completely replaced from the consumer market. In your opinion, what are the most important advantages of a glass bottle over others? - Glass containers are primarily environmentally friendly. Glass can be used, assembled and recycled an unlimited number of times, unlike plastic or any other packaging. In a resource-limited economy, this is especially valuable. Of course, while glass processing is not the most common industry, but the environmental potential of glass packaging processing is obvious. But even in the absence of processing, glass does not emit any harmful substances during waste disposal, which is currently one of the most important advantages.

Secondly, glass is safe, hygienic and universal. Glass containers are chemically inert, neutral in composition, they are odorless, do not emit harmful substances, and do not alter the aromatic or taste characteristics of the product in them. Due to its properties, glass containers are suitable for storing any substances, from acids to alcohol, reliably protecting them from light and air.

- You acquired the plant about three years ago and have already invested a lot in its modernization, in replacing equipment, what are the results? Does this make it possible to compete with foreign glass factories?

- Our factory is already competing with foreign glass factories and is doing this quite successfully. Last year, we entered the foreign market, and the share of exports in the company's turnover amounted to 5%, this year we plan to increase exports to 15% and in the future we will continue to develop cooperation with European countries. The main bet will be made on 3 key points. Firstly, high quality standards: as part of the modernization, we introduce modern technologies. Secondly, we invest in the development of personnel, in improving their skills and motivation. Thirdly, we keep competitive prices due to the efficiently organized production process and our own sand resource base.

- And does a defective product happen, what do they do with it?

- There is a marriage that appears during production, this is an absolutely normal process. In this case, since, as already noted, the container can be processed an unlimited number of times, it immediately goes to processing on the same production day and new products are made from it. It should be noted that a certain percentage of marriage is normal, natural and even useful, since it allows you to maintain the constant chemical composition. The so-called passing marriage is caught either by special equipment, or line inspectors or technical control officers who selectively check the packaging that has already been packed, and is sent to the return glass tape, from where it goes for recycling. Such quality control allows us to minimize the situation when suppliers return a substandard batch. Nevertheless, even for this case we have a well-developed scenario: we take away the marriage from them and replace it with new products.

- More recently, the State Duma deputies proposed to resume the reception of glass containers from the population. How do you feel about this initiative? Does she have pros and cons and which ones?

- On the whole, it’s positive, but we see this as a long-term work. Accelerated implementation of technologies for the return of raw materials to processing requires at least 6-8 thousand tons of glass waste per month (the minimum weight for processing to be economically justified at all), which cannot be achieved by collecting glass from the population even in large cities.

The introduction of a glass collection system in the population as one of the types of separate waste collection at the source of their generation requires a change in mentality, cultural code, and basic habits. This is a rather long process, and in order to ensure a sufficient amount of raw materials for launching an automated waste processing system by implementing separate collection, it should take 5-10 years at best.

Therefore, this should not be done to the detriment of the primary and urgent measures related to supporting those enterprises that are engaged in the primary sorting of garbage automatically or semi-automatically, since at the first stage it is the primary waste sorting system by operators at landfills or specialized sorting complexes that will provide the necessary minimum quantity secondary raw materials for launching automatic complexes for preparing glass for use at glass enterprises.

- In your opinion, should the state, possibly represented by local authorities, regulate this industry? It is possible to set tariffs or intervene through state orders for especially large enterprises in order to support their production or some other stimulating or regulatory measures ...

- SSK, and I, in particular, am against excessive state regulation of the industry. We believe that government intervention in the economy should be sufficient for its sustainable development and at the same time minimal so as not to adversely affect competition and not burden the business with additional transaction costs.

If we talk about support measures, then, of course, business always welcomes any initiatives that stimulate the development, nevertheless, we assume that it is unlikely that a government order can be an effective element here. In our understanding, this is a good time to consolidate the position of Russian glass producers in the European market, and this is limited, first of all, by the huge share of transport costs in the cost of the final product for the European consumer. Earlier, an initiative was announced to subsidize transport costs of exporters, and, in particular, this initiative was discussed in relation to glass enterprises. We support such initiatives and hope that they will be brought to an end and products of glass industry enterprises will be included in the list of products, the transportation of which abroad can be partially subsidized.

It is also necessary to note the importance of state participation in the development of single-industry towns and small towns. Traditionally, glass enterprises are located far from large cities and regional centers, and therefore they are forced to spend a certain amount of resources on the development of the territory, because business development, in our opinion, cannot be separated from the development of the social environment and the ecosystem in which people live. If these are city-forming enterprises, then naturally they try to participate in their lives and improve their social environment, but the business itself, although social, as it provides people with jobs, cannot provide them with all the necessary infrastructure. Therefore, in our opinion, the state needs to ensure a comfortable environment, which is in principle provided for by the presidential development program. As part of this program, we support the village feldsher point, open a sports ground, build a bathhouse, and plan a number of additional activities to improve people's lives. However, questions regarding road or, for example, gas infrastructure in the village where our company is located, can only be solved at the expense of the state. We warmly welcome such initiatives by the state, because for us the well-being of workers and their families is the key to their greater efficiency in the workplace, which means that we, as a team, as a family, will be able to work better.

In addition, the state can help in the development of the vocational education system or, at a minimum, support enterprises in the development of local training centers. Now we independently invest in the development of personnel for our industry, because the country does not have an effective system for training production personnel. What can I say, in the village there are not even elementary computer classes! It would be nice if the state would help us and residents in such matters.

- How will the development of the glass waste processing market affect the glassworks business?

- The Association of Glass Container Manufacturers, where I chair the recycling committee, is trying in every way to convey to the state and market players the need to stimulate the glass waste recycling market. Today, glaziers do not have many alternative suppliers of raw materials: the soda market is essentially a collective dominance market, where only 2-3 players are present, and soda prices are rising, taking into account logistics costs and quality problems, there is also a limited choice of quartz suppliers sand, gas is, by and large, a commodity that is supplied by a natural monopoly. In this regard, there is very little competition in supplies, and prices are rising. And glaziers are very dependent on raw materials and energy. Under these conditions, the development of the glass processing market may at least partially reduce this dependence and allow glass-makers to gain access to an alternative source of raw materials. But this alternative source of raw materials is good not only because of competition for suppliers, but also because it has a positive effect on the economy of glass enterprises and the state of their production assets. The fact is that for every 10% of the additionally used return cullet as part of the raw material, the profitability of the enterprise grows by an additional 2-3%, and the life of the furnace is extended by 7-10% relative to the originally set. This happens, by the way, due to the fact that glass is completely processed, without losses, in contrast to primary raw materials, which are exposed to waste and shrinkage, and less energy is spent on it. Therefore, of course, we fully support the development of the glass processing market.

- Well, the traditional question: what are your plans for the near future?

- The plans are primarily related to improving the working and living conditions for our employees in order to ultimately keep the population in our village remote from the center. These initiatives will include the introduction of a full-fledged staff training system; we are also going to invest serious funds in the development of the social environment and the expansion of social guarantees.

Secondly, it is the continuation of equipment modernization. At the first stage of modernization, the life of the furnace was extended, partly the modernization of inspection equipment was carried out, the modernization of glass-forming inspection equipment, storage facilities will continue, all this will go in accordance with the plans for the next 2-3 years, after which the overhaul of the furnace will follow.

In addition, we plan to expand the range of products. This year we started production of containers for beer producers, we plan to continue this next year, while remaining traditionally strong in the market for containers for sparkling and still wines. We are also going to develop the export direction and want to increase the share of exports to 20-25% in the next 2-3 years.

Source: http://www.rbgmedia.ru

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