The 8,125 square metre plant, situated a few hundred kilometres south of Shanghai produces plastic closures primarily for export to beverage producers in Japan as well as smaller beverage producers in the domestic market. The site was chosen for its close proximity to both Japan and industrial hubs on the eastern board.
"This is a growth opportunity that we have made the most of," Alcoa spokesman Kevin Lowery told AP-FoodTechnology.com. "We set up production facilities either where the companies are or else wherever we can provide the best opportunities and service for those companies. With respect to the facility in Hangzhou, one of the main benefits we are able to provide is a significant cost saving, which we are able to back up with a comprehensive, one-stop service."
Alcoa CSI also has a plant in Tianjin, from which Alcoa also produces closures for both the domestic and Japanese markets.
Commercial production has begun on two lines to manufacture AS-Lok (a linerless closure for aseptically filled bottles) and PS-Lok II (a linerless closure for hot filled bottles), with customer shipments expected to start in mid-July. Volume at the facility will be 800 million closures a year. However the ability to significantly expand production of the site has been built into the design, which the company says can be easily extended to eight lines.
"Construction of the plant began last January and was completed on time and safely," said Plant Manager Haruyuki Fujiwara. The Hangzhou plant employs 110 people, but more employees will be recruited if the facility is extended.
Alcoa is following a growing trend in the Japanese food and beverage industry whereby the production of packaging is being outsourced to China. In recent years the Japanese economy has been hard hit by economic down-turn and the need for manufacturers to increase production efficiencies has led many businesses to turn to neighbouring China, where production costs are significantly lower.