Domestic glass bottle manufacturers are grappling with a deepening crisis as a shortage of commercial gas forces companies to slash production, deal with increased costs and reduced margins. Industry executives say that container glass makers are staring at least a Rs 100 crore revenue loss over the last 15 days since the gas allocation to the sector was reduced following the war in West Asia.
“This is a difficult situation for us because glass manufacturing is energy-intensive requiring uninterrupted fuel supply. In its absence, around a third of container glass units have already shut down. We may see more plant shutdowns if the gas shortage is not addressed quickly,” says Rrajesh K Khosla, CEO, AGI Greenpac, a Hyderabad-based container glass maker.
All India Glass Manufacturers Federation writes to GoI
Khosla is also the president of The All India Glass Manufacturers Federation, an apex body, which has written to the government on the issue. In the letter the body has requested the government to prioritise container glass manufacturing, given its usage in pharma, food and beverages.
Beer makers, for instance, have already flagged an increase of about 8-20% in the price of glass material in recent weeks, adding that there are shortages visible just ahead of the peak summer season.
“Uninterrupted gas supply is critical for industries such as ours that operate high-temperature furnace systems. A disruption poses operational and safety risks,” Suraj Mehta, chief strategy officer, Hindusthan National Glass & Industries (HNGIL), said.
HNGIL operates seven manufacturing facilities in Haryana, West Bengal, Uttarakhand, Maharashtra, Rajasthan, Andhra Pradesh and Puducherry. Mehta says that furnaces typically hold 300–750 tonnes of molten glass. A reduced supply or stoppage of gas could damage furnace infrastructure and plant assets.
Overall glass industry in India
While the overall glass industry in India is valued at around Rs 54,000 crore, container glass, is around a third of the market at Rs 18,000 crore in size. The rest of the market consists of float glass, used in the real estate and construction sector, and solar glass & speciality glass makers, both segments valued at Rs 18,000 crore each.
The gas shortage, say experts, has affected all segments of the glass industry, with solar and speciality glass makers such as Borosil, for instance, saying it partially suspended operations at its borosilicate glass furnace for pressware products in Jaipur to tide over a gas crunch at the unit. Its opal glass furnaces, on the other hand, also located in Jaipur, were running at reduced capacity, executives at the company said.