EU plans to reduce tariffs on imports of aluminum into the bloc are likely to have little affect on the regions metallic packagers, says an industry expert.
Maarten G. Labberton, director of EAA Packaging Group explained said that although the EU had yet to fully set out their plans for any reduction, the possibility of cheaper imports would have a moderate affect on EU food packagers.
The plans to amend aluminium taxation follow protests by aluminium processors in Eastern Europe who claim the tariffs on established suppliers from outside the bloc, have hit their industries hard.
Media reports currently suggest that these measures could see current tariffs on aluminium imports which stand currently at six per cent, possibly being halved by 1 January 2007.
Though Aluminium is widely used in the industry for both insulating foils, along with beverage and food packaging, contractual obligation and integration between packagers and aluminium producers is likely to reduce the possibility of a major shake up to the industry.
Labberton explained that the measures would have "no impact on integrated companies and therefore the reduction will most likely affect a restricted number of producers of rolled aluminium products. Suppliers of can-sheet and other rolled products such as foil are not directly affected."
Beverage and food can manufacturers, who are one of the most prominent purchasers of the metal, are also expected to remain generally unaffected by any potential changes in the market.
"Most of the packaging business (can manufacturers, etc.) work with long-term supply contracts. Therefore, there will be no immediate impact and if so the impact will be very small," added Labberton.
The case for the reduction has become a priority following the inclusion of ten new members - mostly from Eastern Europe - to the union in 2004.
Countries including Poland have argued that their industries, which have long relied on supplies of aluminium from non-EU suppliers like Russia, are struggling with the tariffs.
In its negotiations for EU membership, Hungary successfully pressed for the tariffs to be suspended during its first year, with the tariffs gradually being reinstated.
Hungary as a result will only begin paying the full six per cent tariff in May 2007.
If the tariff reductions are to go ahead, all 25 EU members will have to agree to the proposals.
To help push the measures, under current proposals - by means of a compromise - the import reductions would only apply to unalloyed aluminium.
EU based aluminium producers like Alcan and Glencore International remain unhappy with the proposals however, which they see as removing a vital form of protection to the industry in the EU.