Sydney-based Coca-Cola Amatil Ltd. will start producing its own recycled-content PET bottles in January.
Ian Brown, CCA corporate affairs manager, said CCA decided this year to manufacture its own PET bottles containing 25 percent recycled content.
CCA has been supplied by Adelaide, Australia-based diversified manufacturer Southcorp Holdings, and by ACI Petalite, a Melbourne, Australia, division of Continental PET Pacific Pty. Ltd.
A subsidiary of Atlanta-based Coca-Cola Co., CCA has the option to purchase ACI's idle machinery as its PET bottle supply contract with ACI gradually is phased out.
Brown said CCA expects to have its PET bottle plant fully operational by the end of 1998. The number of CCA-manufactured bottles will increase gradually as contracts with ACI and Southcorp wind down.
Contracts with both companies expire in April and will not be renewed. Brown said there were ``demonstrable cost benefits to supplying ourselves.''
``The cost per bottle is significantly lower,'' he said.
He also said owning captive blow molded bottle operations means CCA, which holds 65 percent of the Australian soft-drink market, could be flexible in changing and creating new bottle sizes and forms.
CCA is building a PET recycling plant at Campbelltown, west of Sydney, and a PET preform injection molding plant at Sydney's Blacktown. The preforms will be trucked to CCA's five bottling operations in Australia.
Meanwhile, ACI Petalite is for sale, and two Australian competitors may be interested in buying the business.
ACI and Continental PET Pacific are owned by BTR-Nylex Ltd. in Melbourne, which is a unit of London-based BTR plc. The parent recently announced plans to sell its nonengineering businesses.
Melbourne-based packaging and paper company Amcor Ltd. is a potential buyer for ACI.
Amcor's North American division, Containers Packaging, owns Twinpak Inc. of Dorval, Quebec, and has a 64 percent interest in flexible packaging manufacturer Flexible Holdings Inc., which has plants in Tukwila, Wash., and Bowling Green, Ky.
Peter Cairns, Amcor's general manager of corporate affairs, said the firm would ``at the very least consider [buying ACI].'' Amcor has a small PET business in Australia.
Former CCA supplier Southcorp also could be a possible buyer of ACI.
Peter Dwan, Southcorp's marketing manager for rigid packaging in Melbourne, said there is a possibility the firm is interested in ACI, but he would not elaborate.
Industry insiders value Australia's PET bottle market at about A$250 million (US$171.4 million) annually.