Canned Foods

INDUSTRIAL CODES

NAICS: 31-1111 Dog and Cat Food, 31-1225 Fats and Oils Refining and Blending, 31-1330 Chocolate and Confectionery, 31-142M Fruit and Vegetable Canning, Pickling, and Drying, 31-1514 Dry, Condensed, and Evaporated Dairy Products, 31-161N Animal (Except Poultry) Slaughtering and Processing, 31-171M Seafood Preparation and Packaging, 31-191M Snack Food Manufacturing, 31-1920 Coffee and Tea Manufacturing, 31-194M Seasoning and Dressing Manufacturing, 31-199M Food Manufacturing, not elsewhere classified, 31-211M Soft Drink and Ice Manufacturing, and 31-2120 Breweries

SIC: 2011 Meat Packing Plants, 2023 Dry, Condensed, Evaporated Products, 2032 Canned Specialties, 2033 Canned Fruits and Vegetables, 2047 Dog and Cat Food, 2066 Chocolate and Cocoa Products, 2068 Salted and Roasted Nuts and Seeds, 2076 Vegetable Oils, 2082 Malt Beverages, 2086 Bottled and Canned Soft Drinks, 2091 Canned and Cured Fish and Seafoods, 2095 Roasted Coffee, and 2099 Food Preparations, not elsewhere classified

NAICS-Based Product Codes: 31-111111, 31-111141, 31-111142, 31-13207, 31-14211, 31-14214, 31-14217, 31-1421A, 31-1421D, 31-1421G, 31-1421J, 31-1421W, 31-14221, 31-14224, 31-14227, 31-1422B, 31-1422W, 31-15145, 31-1611M, 31-191112, 31-19201, 31-194211, 31,194212, 31-19994, 31-1999P1, 31-21114, and 31-21201

PRODUCT OVERVIEW

The canning of food began early in the nineteenth century when Nicholas Appert, a French chef and candy maker, responded to a contest held by Napoleon Bonaparte. Bonaparte hoped to supply his troops with wholesome preserved foods when on campaign. Appert invented canning in glass containers in 1809. Britain, Napoleon's chief political adversary, rapidly responded. In 1810 the Englishman Peter Durand received a patent for food preservation. He used containers made of tin-coated sheets of iron hoping to produce a less breakable and more easily transported product. Durand was thus the inventor of the tin can, so called—although tin was only a coating intended to protect the underlying metal from the acids in foods. Canning expanded rapidly.

Can making commenced in the United States in 1812, brought from Europe by Thomas Kensett, an immigrant from England. The Civil War greatly accelerated use of canned foods. Just before the war began in 1861 production was around 5 million cans per year; after the war production had reached 30 million cans. In 1900, less than one hundred years after the basic technology had been invented, the so-called sanitary can made its debut. This was a can made with double-folded seams, the seams covering up the solder and thus preventing its migration into the food. By the early 1920s automated can making had been developed and cans were churned out at the rate of 250 cans per minute as compared to roughly 10 cans per day per laborer before. After that, technological improvements came in stages. Cans began to emerge in the beverage market in the 1950s and aluminum cans appeared in the 1960s. Lead solder gave way to other ways of seaming cans. Ever more sophisticated coatings were introduced to protect the can from the food and the food from the can. Dual-metal (steel-aluminum) closures were introduced for easy-to-open cans. Cans became lighter, their production more automated, and can making and canning operations more tightly integrated.

The purpose of canning is food preservation. From this perspective canning—whether the container is metal or glass—provides the same protection. Both types of containers are vacuum-sealed when holding perishable foods, accomplished by applying seals as the contents are submerged in boiling water. The phrase home canning refers to preserving fruits and vegetables in glass containers. Over time, however, canned food has come to mean food packaged in metal cans. The Census Bureau's reporting follows this convention. Until 1997 foods and beverages were a single industry category ("Food and Kindred Products") under the Standard Industrial Classification (SIC) system. After that date, with the introduction of the North American Industry Classification System (NAICS), Food Manufacturing was separated from Beverage & Tobacco Products. In this essay we follow the earlier convention and will discuss both canned food and beverage products under the general term Canned Foods.

Food preservation continues to be the principal reason for using metal cans as packaging. Canning, however, has expanded beyond its original purpose so that some foods are packaged in metal cans even when other packaging would do as well. An example is distribution of cookies, salted nuts, and roasted coffee in attractive metal cans. The great majority of foods and beverages delivered in cans, however, are in metal containers in order to protect them.

Although canned foods as a category is in common use both in popular and in commercial speech, no precise measurement of the total category is available from the Census Bureau. Put more precisely, the Bureau provides census data on a range of major industry subcategories in which the packaging mode is specified. Examples are some of the biggest categories like fruits and vegetables, soft drinks and beer, pet food, dairy products, and salted nuts. In other food categories, however, the mode of packaging is not provided and requires estimates based on such data as, for instance, the industry's consumption of different kinds of packaging materials. An alternative source of information is provided by the U.S. Department of Agriculture (USDA) which, in reporting on food consumption by the public, identifies quantities consumed in fresh or canned forms.

Data from the USDA dealing with food availability per person per year provide one view of canned food. Thus in 2005 just under 1,650 pounds of food were available for consumption per person, up from 1,634 pounds in 1995. Availability should not be confused with actual consumption because substantial quantities of food are lost in processing. These data also exclude beverages. Of this total, however, around 8.6 percent reached consumers in canned packaging in 2005, down slightly from the 1995 level of 8.7 percent. In that these data inevitably miss some of the food that ends up in cans—because no basis is provided for a good estimate—it may be reasonable to assume that approximately 10 to 12 percent of all food may come to us in cans of some sort. Major categories include:

• Fruits: 17% of all food, 6.1% canned
• Vegetables: 25% of all food, 25.3% canned
• Dairy: 17% of all food, 0.6% canned
• Meat and Poultry: 11% of all food, 2.5% canned
• Fish: 1% of all food, 15% canned
• Fats and Oils: 5% of all food, 12% canned
• Tree Nuts: 0.2% of all good, 15% canned
• Coffee: 0.6% of all food, 53% canned
• All Other: 23% of all food, the canned proportion unknown

The All Other category includes grains, dried legumes, sweeteners, eggs, and peanuts. It is possible to produce a rank order of canned foods from this listing by weighting the canned portion by the quantitative magnitude of the food category. Using that method, the top five categories of canned foods are vegetables, fruit, fats and oils (primarily vegetable shortenings), coffee, and fish (primarily seafood). Another way of looking at the category is from an industrial perspective. A look from that viewpoint will be carried out under the Market subheading below in which, alongside the look at food, beverage packaging in cans will be included as well.

The Canning Process

The principal object of all food preservation is to prevent bacterial activity in the food from causing it to spoil. The major approaches to this end have been drying, pickling, salting, smoking, and freezing. Bacterial activity requires water which, removed in drying, inhibits bacterial action. Pickling preserves food by creating an acidic environment intolerable to most microorganisms. Cheeses, for instance, are stabilized by the presence of lactic acids produced by certain bacteria feeding on milk-sugar, making it difficult for other pathogens to live. Salting causes cell dehydration and kills off bacteria; salting is a type of pickling. Smoking causes antioxidants to be present in food and these suffocate bacterial life. Freezing immobilizes the water that bacteria need to live.

The innovation introduced by canning depended on two factors. One was hermetically sealing of containers and the other was heat sterilization. Bacterial organisms are killed off by the application of high heat applied to a sealed container. The seal is tight enough that bacteria cannot reach the food again until the can is opened.

Using fruit and vegetable canning as examples, the process of canning itself may be envisioned as four major operations, the two central steps are unique to the canning process itself.

>Food preparation and filling

Fruit canning begins with washing the fruit, a sorting and grading step, peeling and coring of products that require it, chopping and slicing if desired, and optionally cooking of the fruit before it is placed in a can. Vegetable processing is similar but with some of the steps arranged in a different order. Most vegetables are subjected to blanching after being washed, sorted, and cut. Blanching is intended to kill off bacteria by immersing the vegetable briefly in boiling water. Vegetables are peeled, if required, after blanching and/or cooking. Another wash cycle follows peeling.

>Container sealing

Filled containers are vacuum sealed. This means that air is drawn out of the container immediately before it is sealed, accomplished either by sealing the cans while their contents are hot or sealing them in a vacuum chamber. The object is to create a pressure inside the can lower than atmospheric pressure to keep seals tight, to remove as much free oxygen from the can as possible, and to keep cans from bulging later if used at high altitudes. When hot water vapor condenses into steam in a closed chamber, a vacuum is created. If some of the air is also evacuated from the chamber, vapor condensation is even more effective. Steam tunnels or locally applied steam condensation is used in creating a vacuum during can sealing.

>Heat sterilization

This crucial process in canning follows sealing. It is produced by heating the containers briefly to a boiling temperature. In many modern processes, sterilization of the product and of the container itself are separated. At the point of filling, a sterile product is placed in a pre-sterilized container.

>Cooling, labeling, and storage

The hot product is next cooled and dried. After that labels are affixed, cans are placed in packing boxes, and the boxes aggregated onto pallets for transport to the warehouse.

Variations on this general scheme characterize all canning operations. Differences arise from the kind of product canned, its levels of natural acidity, and whether or not the process is continuous or handled in batches.

MARKET

The most recent year for which the total market for canned foods could be estimated at the time of writing was 2002. Data for that year were issued in the spring of 2006 for the first time by the U.S. Census Bureau. Data for 2007 would be issuing no earlier than 2011. Thus details for 2002 are, in the slow-moving world of economic analysis, current data. These data, which follow, are based on dollar transactions rather than food weights, the basis of the earlier discussion above using USDA per capita data. In 2002 the U.S. market for canned food was $56.5 billion, down from $58.1 billion in 1997. By the very nature of the subject—in that canned foods are sold as part of a number of major food industries—these data were aggregated from different census reports and represent a composite picture. Thirteen major industries were included in the list. Shown in rank order based on food sold in cans, these industries are shown in Figure 44.

In the majority of these industries the Census Bureau's own reports identify those subcomponents of the total industry that come to the consumer packaged in cans. In a few cases no data are provided and the values shown in the table of Figure 44 were based on estimates. In the Coffee and Tea industry, it was assumed that all ground roasted coffee was delivered in cans but that no tea came in cans, probably overstating the canned market. In the Fats and Oils industry, it was assumed that 25 percent of vegetable shortenings were canned, based on the industry's consumption of packaging materials. In the Seasonings and Dressings industry, 15 percent of pepper and spices were assumed to reach the retail market in cans. Some industries were excluded for lack of data. Some chicken reaches the market in cans, but the amount is im-possible to discern from Census data. The same is true of baby food, cookies, flavorings and syrups, and other categories in which data on packaging materials consumption are either not reported or suppressed. The general picture presented, however, closely matches data reported by the Can Manufacturers Institute.

If all the canned food categories, thus excluding soft drinks and beer, are expressed as a percent of total food shipments in the United States, canned food represented 8.7 percent of dollar value in 1997 and 8.4 percent in 2002. These numbers are very much in the same magnitudes as those obtained from the USDA on quantities available in canned form to U.S. consumers per capita. If the food and beverage sectors are combined, those portions packaged in cans represented 12 percent of total in 1997 and 10.8 percent in 2002.

If we look at the eleven industries where most of the food canning takes place (excluding beverages), these industries in total, including all of the products that they ship, not merely canned goods, represented 44.5 percent of all food shipments in 1997, 38.3 percent in 2002, and 37.7 percent in 2005. Data for 2005 are aggregates with the canned portion not available. These industries were thus, as a group, losing share of total market. If we look at the two beverage industries, the pattern is somewhat different. These two industries taken as a whole—including product bottled in glass and plastics as well as metal—represented 83.1 percent of the total beverage market in 1997, 78.5 percent in 2002, a drop in share, and then 80.4 percent in 2005, a gain over 2002. The result for these industries is mixed. The total beverage category also includes distillers and wine producers.

Examining growth trends between 1997 and 2002 for the thirteen industries and comparing their annual compounded growth rates, shows, as a whole, a negative growth rate of 0.9 percent. The canned portion also declined but at a slower rate, 0.5 percent per year. This negative growth rate was due principally to declines in the canned components of soft drinks and beer, declining at an annual rate of 3.6 percent. In the food sector, the canned components grew at a rate of 1 percent, thus below the rate of population increase. Among the industries taken individually, ten had growth in total shipments, three declined. In the canned portions, seven had growth in shipments and six declined. The details are shown in the graphic. The major issues underlying these trends are discussed under the heading of Current Trends below.

The general picture that market data present is that canned foods/beverage categories are components of thirteen very large and generally mature food and beverage industries in which they represent about a quarter of all shipments and about 11 percent in the total food and beverage industry. Canning growth in food is growing minimally and declining in beverages, more so in soft drinks than in beer.

KEY PRODUCERS/MANUFACTURERS

The twentieth century in the food industry was a period of corporate consolidation so that, in the twenty-first century, most of the largest food companies offer a very wide array of products and have been assembled by their managements by acquisition of leading brands, each one once offered by specialized companies. The key producers and manufacturers of canned food in the United States are consequently the leading food companies, and the key producers in beverages are the dominant companies in soft drinks and beer.

The leading producers in this major segment, arranged here in alphabetical order, are Anheuser-Busch, Campbell Soup Company, Coca-Cola Company, ConAgra Foods, Inc., Del Monte Foods Company, Dole Food Company, General Mills, Kraft Foods Inc., Nestlé S.A., PepsiCo, Inc., Procter & Gamble, and J.M. Smucker. Revenue data in the following company descriptions refer to 2006 or 2005 data unless otherwise noted.

Anheuser-Busch

With $18 billion in sales, Anheuser-Busch is the nation's top beer producer. The company is also a major producer of aluminum cans through a wholly-owned subsidiary (Metal Container Corporation), much of the production of which Busch itself buys for its own packaging.

Campbell Soup Co.

With revenues of $7 billion, Campbell Soup is the dominant company in what the industry calls canned specialties. It is the leading maker of canned soups sold under its own and the Swanson brand. Campbell produces V8 canned juices and also sells SpaghettiOs, the second-ranking brand in canned pasta products.

Coca-Cola

This company, with sales of $24 billion, is the nation's and the world's top soft drink producer.

ConAgra

A diversified food manufacturer with approximately $12 billion in sales, this company is an important canner of tomato products (Hunt's), of canned beans (Van Camp's and Ro*Tel), owner of the leading canned pasta producer (Chef Boyardee), and is also the producer of a leading canned cooking spray brand (Pam).

Del Monte

This company, with sales of $3 billion, is the leading producer of fresh fruits and vegetables. These product lines represent Del Monte's traditional business. Like many other food companies, however, Del Monte has diversified and is a factor in canned seafood (StarKist), in soups, and in pet food (Gravy Train, 9 Lives).

Dole

This company had sales of $4.7 billion in 2003. Soon thereafter the company went private. Dole is also a leader in fruits and vegetables, but its canned products are principally oranges, pineapple, and tropical mixes.

General Mills

This company which originated as a flour producer, is an $11.6 billion diversified food company participating in the canned food business principally through its Green Giant line of vegetables, Progresso soups, and Old El Paso canned bean specialties.

Kraft

This company, with sales of $34.4 billion, is known above all as a dominant producer of cheese products. The company plays a role in canned food by being an important coffee producer through its Maxwell House, Yuban, and General Foods coffee brands. Between 1988 and 2007 the company was owned by Philip Morris (later renamed Altria). Altria spun off Kraft as an independent corporation, with full independence reached in March 2007.

Nestlé S.A.

The Swiss food giant, with revenues of approximately $75 billion worldwide, participates in canned foods in many areas but most notably in vegetables through the Libby brand, acquired in 1970, its own brands of chocolate syrups, the Carnation brand of condensed and evaporated milk, acquired in 1985, and in pet foods (Alpo, Mighty Dog, Purina).

PepsiCo

This company is the second-largest soft drink producer in the world with $32.6 in total sales of which 28 percent are related to beverages.

Procter & Gamble

This company's predominant activities are in the personal care, household cleaning, laundry detergents, prescription drugs, and disposable diapers markets. This $68.2 billion company, however, is a major factor in coffee production, selling the leading brand of coffee, Folgers. P&G also sells a line of pet food (Iams).

Smucker

This company, with sales of $2.15 billion, is best known for its fruit preserves and jams, sold in glass containers. Smucker, however, is the owner of the Crisco brand, the leading vegetable shortening product and of the Pet brand of condensed milk. Smucker also owns the Knudsen brand of fruit juices some of which reach the market in cans.

The full range of corporate participation in canned foods is partially indicated by Census data which show that, in 2002, 899 companies were engaged in the fruit and vegetable canning business alone. A substantial volume of canned food is produced by many participants in the food industry for private labels. Examples of such brands are America's Choice, the private label brand of A&P; the Kroger brand of fruits, vegetables, and canned specialties; the Kirkland brand owned by Costco; and Sam's Choice, Wal-Mart's brand used in foods. A leading producer of baked and canned beans is Bush Brothers & Company, a privately held organization selling the Bush brand of canned products. The best-known canned meat product in the United States is Spam, produced by Hormel Foods, a $5.7 billion company. The second-ranking tuna brand is Chicken of the Sea, owned by Tri-Union Seafoods LLC, a $450 million company. The oldest brand of condensed milk is Borden. The product has been produced since 1997 by Eagle Family Foods, Inc.

MATERIALS & SUPPLY CHAIN LOGISTICS

With the largest category of canned foods being fruits and vegetables, products which easily spoil or lose their freshness soon after harvesting, the dominant logistical concern in canning is to carry it out as rapidly as possible after the raw product is obtained. This requirement, which also applies to such categories as fish, meat, and dairy, has concentrated canning activities in close proximity to the occurrence of the product to be canned, thus in agricultural and horticultural centers, near slaughtering operations, and close to seashores where fresh fish are delivered for processing. In continuous operations of any size, the manufacturing of the containers takes place very close to filling operations. The can factory is located adjacent to food preparation, the cans arriving ready-to-fill on conveyor belts from next door, as it were. The co-location of product processing and can-making is largely dictated by economics: it is more cost effective to deliver the raw materials for cans (coils of sheet steel, pre-fabricated ends and closures, and coatings in bulk) than empty cans.

DISTRIBUTION CHANNEL

Canned foods and beverages reach the ultimate consumer through grocery stores, convenience outlets, and grocery chains. A portion of soft drinks is distributed through vending machines. Typically distribution is two- or three-tier. Large retailers act as their own distributors; they buy directly from producers and sell to the consumer. Independent retailers usually rely on the services of food wholesalers; the latter buy from the producer, sell to the store, and the store to the customer in a three-tier distribution. The ultimate rationale for buying canned goods is product preservation on the shelf. For this reason institutional buyers like restaurants and hospitals also buy canned goods exactly like the ordinary shopper; they may buy the goods in larger cans, of course. Such buyers, however, buy canned goods in bulk quantities and, even in cases where the purchases are made from retailers rather than distributors, institutional buyers usual receive discounts.

KEY USERS

Virtually everyone buys canned goods and beverages. Certain product categories are available in no other form, an example being condensed or evaporated milk. In all other cases, the principal motivation is convenience and economy. Buying only fresh products imposes much more frequent shopping and the risk of higher spoilage rates. Buying only frozen products requires substantially higher refrigeration capacity. And in all cases more labor is required to reach the ultimate object—the steaming meal on the table.

ADJACENT MARKETS

Canned foods and beverages compete with products packaged in glass, plastics, and paper/plastic composites. This competition is visible across the board. All beverages and most foods are delivered in glass containers sealed with metal caps. Plastic bottles are a major competing product for aluminum cans in carbonated beverages and almost completely preempt metal cans even in oils; a very small fraction of edible oils still moves in cans, but this mode of packaging is disappearing in that category too.

Adjacent in another sense are markets offering food preserved using alternative methods. The most prominent method is freezing. Frozen foods offer many of the same advantages as canned foods if refrigeration space is available. Dried foods are another alternative but have the disadvantage of requiring reconstitution by adding water. The combination of freezing and drying has played an important role in coffee distribution, indirectly displacing canning of roasted coffee, which preserves the flavor and freshness of the product. Freeze-dried coffee, for example, was 11 percent of all coffee sold in 1997 and 13 percent of coffee sold in 2002.

A very important, difficult to measure, and still relatively new development in the food industry is the growth of prepared foods and ready-to-eat meals which represent an indirect competition to canning. This trend is aimed at transferring the labor of cooking from the kitchen to the factory—the food industry hoping that it can achieve growth in a mature industry by tempting the busy home-maker to pay a much higher margin for convenience. This development is indirectly aided by such improvements in kitchen tooling as advances in microwave ovens and innovations in food preservation by the exploitation of composite materials, including paper-plastics-metal composites. To the extent possible, canned food manufacturers are attempting to provide buyers with products that fit the ready-to-eat category and in this way they may be able to benefit from the trend.

RESEARCH & DEVELOPMENT

Research & Development in this broad category is principally centered on the packaging itself, thus the can, rather than on the broad range of products that are distributed in cans. Where the product is receiving a great deal of attention—an example being soft drinks where the industry appears to be engaged in what looks almost like a desperate search for gaining and holding the attention of customers with new flavors and formulations—packaging changes are driven by marketing motives. Here, too, an example comes from beverages where tapered cans, resembling bottles but cooling faster in the refrigerator, have been introduced to catch the eye.

Other areas of interest to researchers in the canned food and beverage industry are glass lined cans for use with beverages, in particular beer, and self-heating cans for use with food. Beer sold in cans far outsells beer sold in glass bottles, nonetheless, connoisseurs of beer have long complained that some beers take on a tinny flavor from the cans in which they are packaged. Can producers are working with microbreweries like KettleHouse Brewing Company in Missoula, Montana, to use cans lined with a glasslike, food-grade coating that helps to prevent any flavor deterioration.

Self-heating cans are another new type of can being tested for widespread use. The self-heating can looks like any other food can but it has a hidden interior chamber that contains lime and water. A mechanism is used to allow a user to cause these substances to mix when the user is ready to heat the contents of the can. So far, these cans are still being tested in trials while work is being done to improve their functionality.

An aging Baby Boom generation has inspired the introduction and improvement of easy-to-open closures so that people suffering from arthritis can avoid the effort of using can openers. Throughout the history of canning, coatings have improved. The better the coating the less likelihood exists that acids in the food will attack the can or that metallic tastes migrate into the food or beverage. Taking costs out of the package or the packaging process is receiving continuous attention. Not least, creation of new composite products is of great interest to the industry. One example is a coated, aluminum can with a non-metallic lid aimed at producing products that can be placed into the microwave directly. The canned food industry is interested in all product modifications that will allow it to compete head-on with the growing number of ready-to-eat meal products, many of which are designed for heating in a microwave oven.

CURRENT TRENDS

Canned Food

Looking first at trends in food packaging alone, leaving beverages to the side for a moment, statistical data for the 1997 to 2002 period indicate that the eleven major industries where canning takes place have declined in shipments, from $187.6 billion (1997) to $175.6 billion (2002), a decline in shipments of 1.3 percent per year. In this same period, the canned portion of these industries increased from $38.5 to $40.5 billion, a rate of increase of 1 percent per year. Thus canned goods increased in share of these industries from 20.5 to 23.1 percent in 1997 and 2002 respectively. Canning has thus held its place, indeed has increased its presence in these crucial industries, but the industries of which they are a part themselves have lost ground.

The largest absolute gains in canning were achieved in four traditional categories, fruits and vegetables, pet foods, and in condensed/evaporated milk. The largest percentage gains were seen in the last category, milk, and in snack foods, specifically in canned salted nuts. The largest absolute and percentage losses were in the coffee and tea category, an industry that, as a whole, shrank from $8 billion in 1997 to $5.2 billion in 2002. Based on later aggregate reporting on the coffee market, coffee as a category improved after 2002, but data on specific product lines were not available.

It is worth noting that in the 1997 to 2002 period shipments of steel cans themselves (steel is principally used in food), thus the packaging rather than the product, declined at the rate of 2.7 percent per year, indirectly suggesting that physical quantities of product sold declined as well, with the 1 percent annual growth in canned products, noted above, achieved by price increases and/or caused by shifts in the canned product mix from commodity-style goods to branded products, as the growth in snack foods in part illustrates. Snack foods as a whole, for example, grew at 4.4 percent per year whereas fruits and vegetables grew at a rate of 3.3 percent per year.

It is of particular pertinence to note that in the food group itself, the All Other food category (formally Food Manufacturing not elsewhere classified) showed the greatest rate of growth of all eleven industries that have some canned products. This industry grew at 7.9 percent per year. It has very little canned food content (just puddings and canned frostings). But it includes the novel new products the food industry envisions as the leaders into the future: prepared foods and ready-to-eat meals. The growth of this industry indirectly influences the slow growth in canned categories and hints at likely future developments provided that purchasing power in the nation continues to grow.

Canned Beverages

Trends in the beverage markets based on 1997 to 2002 data strongly hint at a decline in the canned segments of the two markets involved—soft drinks and beer. These two industries in combination had shipments of $50.6 billion in 1997 and $51.7 billion in 2002, advancing at a rate of 0.4 percent per year. In this same period, the canned portions of the industries declined from $21.5 to $17.8 billion or from 42.4 to 34.5 percent of these two beverage industries taken as a whole. The decline in the canned components was 1.2 percent per year in beer and 5.8 percent per annum in soft drinks. In the beverage categories competition from glass, and more intensely from plastics, is the major factor. Glass has always enjoyed superiority in preserving taste; glass is one of the most inert of packaging materials available—one reason why it is universally used in packaging wine. Plastics have been favored by superior economics. Trends in the beverage industry, powerfully influenced by marketing rationales, favor novel material combinations and shapes. The winner, if there ever will be one, is yet to emerge. Can producers hope it will be a bottle-shaped can, or a glass lined can.

TARGET MARKETS & SEGMENTATION

The major segments in this wide cluster of products are preservation and utility, exemplified by commodity-style food products like fruits and vegetables, beverage packaging in which strength (to hold in carbonated liquid pressures) and rapid cooling are advantages, and taste protection desired by coffee and nut canners. In the twenty-first century the can, as such, is no longer promoted as a segment-defining packaging feature except in those situations where the producer wishes to communicate prestige, exemplified by packaging cookies in beautifully decorated tins.

RELATED ASSOCIATIONS & ORGANIZATIONS

American Beverage Association, http://www.ameribev.org/index.aspx

The Beer Institute, http://www.beerinst.org

Can Manufacturers Institute, http://www.cancentral.com/index.cfm

Canned Food Alliance, http://www.mealtime.org

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"Dawn of the Can." The Aluminum Association Inc. 24 October 2004. Available from 〈http://www.aluminum.org〉.

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Lazich, Robert S. Market Share Reporter 2007. Thomson Gale, 2007.

"Long Live the Metal Can." Food Logistics. 15 October 2005.

Panjabi, Ghansham and Philip Ng. "Packaging Unplugged." Wachovia Capital Markets, LLC Publication. 22 December 2006.

"Product Summary: 2002." 2002 Economic Census. U.S. Department of Commerce, Bureau of the Census. March 2006.

see also Cans, Frozen Foods