COVID-19 pandemic has brought upon us yet another surprising shortage.
First it was toilet paper. Then it was garden supplies and outdoor camping and sporting equipment. It should come as no surprise that the COVID-19 pandemic has brought upon us yet another surprising shortage: aluminum cans. It seems that among the panic-buying frenzy, North Americans have deemed canned pop and beer as essential supplies worth stocking up on. The sudden shift from drinking in restaurants and bars, where most beverages are served on tap, to drinking at home, where most beverages are served from cans, was an unexpected one. This sudden and extreme demand for canned beverages became much higher than the supply could handle.
But what most of us don’t realize is that the aluminum can industry was starting to feel pressure in the supply chain even before the pandemic began. Some factors that have contributed to today’s aluminum can shortage include:
Going Green: Being an infinitely recyclable material that performs just as well as the same product created from raw materials has made aluminum an attractive option for companies looking to go green. Add in the fact that the recycled product is actually cheaper to produce and demand increases even more. Since aluminum cans are considered an environmentally friendly – and cost-effective – product, many beverage companies have started moving towards using aluminum over plastic.
Recycling on Hold: Aluminum cans contain over 70% recycled materials. The majority of these materials come directly from used beverage cans. These cans are collected residentially and commercially, converted into can sheets, and made into new aluminum cans. Among the large list of sudden pandemic closures were collection companies. Suddenly the cans that were being bought in bulk were not able to be returned to recycling process.
Facility Availability: Can sheet production has been on the decline as manufacturers have begun converting their facilities into automotive sheet producers. Auto sheet is more profitable than can sheet and with aluminum can demand dropping 1% annually for the last several decades, auto sheet’s future was looking bright. This decrease in demand for can sheet created a demand decrease for used beverage cans, which in turn decreased used beverage can collection.
Increased Demand: In 2019, the aluminum industry saw a 5% unexpected rise in can sheet demand. From the rising popularity of purchasing craft beer to the shift towards more sustainable packaging, the aluminum can industry underestimated its rising demand. The demand for canned beverages jumped once more when the pandemic struck in early 2020. By this time, however, many manufactures had already slowed their aluminum can production, making the sudden panic-buying frenzy even harder to keep up with.
What does the future hold?
As Canada prepares for its second wave of COVID-19 and another potential lockdown, the aluminum can shortage issues are expected to continue. With collection companies and manufacturers decreasing operations and potentially closing down to slow the spread of the virus, increasing aluminum can production seems unlikely.
Pop and beer companies are doing their best to keep store shelves full for consumers. Many have pulled the less popular products from shelves altogether in an effort to increase supply for the most favoured beverages. Companies are also sourcing aluminum cans from new suppliers around the world.
2020 has been a challenging year for most companies around the world, including the aluminum industry. We’re being taught to expect the unexpected and to find creative solutions for once non-existent challenges.
If you have questions about how you can recycle your aluminum cans, call us at 416-751-4732!