BGC sees rising demand for packaging

BGC sees rising demand for packaging

BG Container Glass (BGC), Thailand's largest glass container manufacturer by capacity, expects demand for packaging products to increase despite a rise in the cost of raw materials.

The higher demand will mainly come from the further easing of travel restrictions, following an improvement in Covid-19 infections, said the firm.

"More tourists can boost demand for food and beverage packaging," said Silparat Watthanakasetr, BGC chief executive.

"But if the government increases the excise tax on alcohol, it will affect consumer purchasing power."

A new excise tax will drive up prices of alcoholic drinks, making people reluctant to buy them, he said.

BGC is reconsidering its business plans, including a new glass melting furnace development project, because it is encountering higher prices for energy and raw materials, caused by the impact of the Russia-Ukraine war.

"The current global situation has made us more cautious about investments. The company needs to control its operational costs to ensure efficiency," said Mr Silparat.

Advanced technology is being used to help manage operational costs.

The company is also talking to its customers about the need to increase packaging prices because of higher costs.

In the first quarter this year, BGC saw its revenue increase by 20% year-on-year to 3.96 billion baht, thanks to higher demand for packaging products after the government relaxed Covid-19 measures.

From January to March, its profit increased to 217 million baht, up from 182 million in the same period last year.

BGC announced last year it plans to allocate an investment budget worth 2.7 billion baht for business expansion.

The company aims to increase glass manufacturing capacity at its two factories by 12% to 3,935 tonnes a day, up from 3,495 tonnes a day, in order to meet growing demand from domestic and overseas markets.

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