Sales of plastics increase with C class boom
Valor Econômico - 05/26/2008
The C class boom is bringing benefits to the market of home appliances made out of plastic, with sales of R$ 3.4 billion (US$ 1.76 billion) in 2007, according to data from the Brazilian Plastics Industry Association (Abiplast). "Part of the people who used to reuse margarine packages to store food, for example, are now buying containers made for that purpose", says Fortunato Caro, President of Plasvale, which belongs to the Lince group, from the state of Santa Catarina, and is one of the major companies of the sector. The company, which grew 6% last year compared to 2006, invested in nine injection machines in the end of December, in order to meet the increase in demand. The expectation, according to Caro, is to increase sales between 12% and 14% this year. Another great rival, Plasútil, from Bauru (SP), hopes to grow from 15% to 18%. It is a competitive market. "Before, there were three major rival companies. In the last 10 years, more than 50 companies got into the market", says Caro. Most of them are small companies that produce containers without a brand which are sold at a restricted retail market, such as stores that sell products at R$ 1.99. The space of this category on the shelves has been increasing. According to market estimates, sales of plastic containers in supermarkets tripled from 2003 to 2007, and they increased more than four times in hypermarkets. Even though at a less strong percentage, the direct sales of this segment, where the history of the plastic containers began, are also increasing. In addition to Tupperware, there are giants like Avon. According to data from the Brazilian Association of Direct Sales Companies (ABEVD), the segment of "household care products", that includes the category of plastic products, generated a turnover of R$ 757 million (US$ 392.2 million) in 2007, increasing 17% compared to 2006. The share of home products in the total of direct sales went from 4.9% in 2005 to 6.1% last year. The sector faces two challenges now: the increase in the price of oil, which has strong influence on the costs, and the competition from glass containers.