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| Tuesday, 29 June 2004 |
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Crompton led in global teabags paper supply in 2003 Today almost all tea companies have developed a value added tea division. Even plantation companies are venturing into this lucrative market. Teabags in particular command high margins and in 2003 had an average FOB price of Rs. 498.62 per Kg of tea compared to Rs. 186.30 for bulk tea and Rs. 216.86 for tea packets. In 2003, 15,527,741 kgs of teabags were exported taking up 6% of J.R. Crompton's annual production, which was 1,000 tons, making it a leading global teabag paper supplier with the largest market share. Crompton exports about two-thirds of its 18,000 tones a year output to over 80 countries and employs 475 staff. Annual sales of Sterling pound 60 million have been growing at about 10% a year. The company, however, which has a 45% share of the global teabag market and a nearly 80% share of the smaller market for coffee bags, has run into serious capacity constraints. As recently reported in the UK Financial Times, J.R. Crompton, the world's leading maker of specialist paper for teabags, has secured a Sterling pound 85 million refinancing package to cut financing costs and support investment in a new paper mill that will boost capacity by a third. The Manchester based company, has paper mills in Heywood, Lancashire and Lydney, Gloucestershire. The acquisition of the 400,000 sq.ft Devon Valley Paper Mill, near Exeter, from Mead Westvaco, a US paper company, will boost capacity by about a third. The refinancing and acquisition of the Devon Mill, underlies the recovery at Crompton, a 148-year-old paper maker that has been through a series of corporate owners since the decedents of the founding families sold out in 1986. In 2000, the company was refinanced in a Sterling Pound 85 million package and a new management team, led by Peter Ashby, Chairman and Chief Executive Officer installed. Crompton also held their 2004 Distributor Conference in Sri Lanka, underlining the importance it places in the Sri Lankan Market. Distributors from the Asia Pacific region had attended this two-day conference which took place at Taj Exotica Bentota. J.R. Crompton is represented in Sri Lanka by Package Care Ltd., a member of MJF Group. Package Care is a packaging solutions provider specialising in the tea industry. |
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