January 26, 2022

Consol: South Africa could soon face an alcohol shortage

In 2020, Consol suspended the construction of a R1.5 billion production plant in South Africa due to concerns over the government’s fondness for banning alcohol.

Consol: South Africa could soon face an alcohol shortage

Consol: South Africa could soon face an alcohol shortage photo credit: Canva

South Africa could soon face an alcohol shortage, not because of an alcohol ban but because of a glass bottle shortage.

Consol, the largest glass manufacturer in Africa, is battling against reduced stock and a limited ability to ramp-up manufacturing quickly. The ability to import glass bottles is also hampered by global shipment delays and soaring freight rates.

In 2020, Consol suspended the construction of a R1.5 billion production plant in South Africa due to concerns over the government’s fondness for banning alcohol.

At one stage during the first and longest ban, Consol warned it may be forced to shut glass furnaces, which cost R8 million a day to operate and can’t easily be switched on and off. Despite the company’s woes, German’s Ardagh Group SA agreed to buy the firm for just over R10 billion in November.

Another challenge to Consol is that some drinkers have shifted to premium purchases, where “additional growth has exceeded historical offtake,” Carolin said. Consol has been supplying more bottles this December than it has in previous years, and demand has exceeded its ability to produce, he said.

Consol has now reinstated the expansion project, but it will still take months to get up and running. That means the glass-shortage problem is likely to remain for the foreseeable future.

Sources: BusinessTech, MSN

Follow FiND iT on Facebook here.

ALSO READ: Government meeting next week to discuss lifting state of disaster – Phaahla

Leave a Reply

Your email address will not be published.