Investment Plans Of Ciner Glass In Bozüyük, Ankara, Belgium And England
Didem Ciner, Ciner Glass Group Executive Board Member, talked about the plans to expand glass packaging production activities in the UK, Europe and the USA.
Didem Ciner, Member of the Executive Board of Ciner Glass Group, took the lead in the plans to expand glass packaging production activities in the UK, Europe and the USA. Didem Ciner made special statements to Glass Worldwide about her plans for the first glass packaging facilities to be built from scratch in Europe for more than 15 years and about Park Glass’s expansion activities.
What is the motivation for Ciner Glass Group to expand its glass production activities outside of Turkey?
We plan to expand our current business operations to European markets where demand for glass bottles is increasing. Although the decision to expand our glass production from Turkey to Europe was taken before the start of the Covid-19 outbreak, I am confident that the recovery from the epidemic already seen in developed markets will only continue to grow in scale and speed.
At the same time, our current activities in Turkey are being expanded. Park Glass is currently the second largest glass manufacturer in Turkey. It has established a wide network of domestic and international customers.
How is investment in Europe structured?
Our new European glass business is headquartered in London. Ciner Glass is 100% owned by Ciner Group. Assets and capital for our European investments will be driven by our UK operations. The Group’s current track record of success helps provide strong and stable foundations for this investment. Our aim is to reach prior agreements with customers to account for at least half of our increased projected production capacity.
Our aim has never been to harm local markets. We estimate that glass packaging imports in Europe have increased by 15-20% on an annual basis since 2018. Indeed, our production in Turkey has helped reduce glass packaging imports to the country.
The pandemic has only had a temporary effect to slow this trend, but as we return to normal activity levels in the coming months, we expect to see both a significant increase in demand and a shortage of capacity very soon. In our assessment, that is the right time to increase our operations in Europe.
What feedback and commitments have you received from potential customers for the expansion to Europe and how were they involved in the process?
As stated in our previous interview with Glass Worldwide [September/October 2015], we completed the installation of our second furnace at the state-of-the-art Park Glass factory in Bozüyük in 2015, while the Turkish market was growing very rapidly.
Our high-quality standards and technological expertise have enabled us to produce bottles that are at least 5% lighter than other container glass manufacturers for the Turkish domestic market.
With this success, we attracted the attention of global brands. In 2018, we started cooperation with one of the largest global beer producers in Turkey, which is interested in our light weight technology. Over a 12-month period, we were able to reduce the weight of this manufacturer’s 330ml long neck beer bottles from 200 grams to 180 grams, making it the lightest 330ml long neck beer bottle available on the market anywhere in the world.
In this case, the best solution to the logistical and operational challenges of being a supplier to European markets, with our products in such high demand from customers, was to build facilities from scratch in Europe.
Our innovative technology can produce glass more efficiently while reducing transportation costs and reducing carbon dioxide emissions. We are currently exploring possibilities to invest in two different European locations, which could be in Belgium and potentially also in the UK.
WE WILL INSTALL A FURNACE COMPLETELY WORKING WITH ELECTRICITY
What can you say about the projected greenfield investment in Belgium?
We signed an option agreement to buy land in Lommel, in the state of Limburg. We applied for building and environmental permits and the Belgian government was very supportive. Nearby is one of the largest silica sand quarries in Europe, which is again helping to reduce our carbon dioxide emissions.
Our main intention will be to supply glass bottles to the beer and wine markets. We are considering building a state-of-the-art facility with two furnaces. Currently, the food and beverage industry in the region has to import large quantities of bottles. This potential large-scale production will offer advantages in terms of both supply and cost. The factory in Belgium is envisaged to provide technical support and assistance for the entire group. An all-electric furnace will have been built, producing up to 80-100 tons of glass per day, to focus on R&D driven growth.
From the very beginning in Belgium, our team will aim for carbon neutral production and is already working hard on a roadmap to achieve this goal. Even if this target is not immediately achievable, we are committed to taking the necessary measures as soon as possible. The projected facility will have the advantage of being located in Europe’s largest solar park, which already supplies at least 100 megawatts of renewable energy.
CINER GLASS IS COMMITTED TO REDUCING CARBON Emissions
So, what are the proposed plans for a greenfield plant in the UK?
Our other potential projection to consider is an additional state-of-the-art facility that could be built in South Wales.
We are evaluating our plan for trade in the region in detail. In addition to the beer and wine sectors, we also target other beverage markets in Wales. South Wales is well positioned to serve our clients’ current UK operations.
We want to support plans for the creation of a Return on Deposit System (DRS) in the UK and are already planning to act on the bill with our investments to create the circular economy cycle for glass. Ciner Glass is committed to cutting carbon emissions more and faster than our competitors. We are developing both our short-term and long-term plans to achieve the goal of carbon neutral production in the UK and Belgium.
Has Brexit affected your UK investment plans?
The impact of Brexit is not related to the development of this project. Our focus is the UK domestic and local markets. It has not been intended to build a glass manufacturing plant of this scale in Wales for a generation.
WE WILL GROW FAST IN EUROPE
What are the main challenges and opportunities for the envisaged European projects?
Ciner Glass wants to reverse the long-term trend in the European glass manufacturing sector lately of limited investment, especially in the establishment of new plants apart from upgrades to existing plants and machinery. Our planned capital investment costs will be high due to the scale and advanced technology we intend to use. But our investments in European glass production have the potential to be transformative for the local communities where we establish our production. These European locations have strategic advantages, but also present challenges such as time taking permitting procedures. However, being closer to our markets benefits the environment and reduces costs to the consumer.
We Soda, a part of the multinational activities of Ciner Group, is our soda ash business that started in Turkey, expanded to the USA and has now become the world’s largest soda ash producer. While the soda ash and glass production activities will be kept unique and separate from each other, combining Ciner Glass Group’s experience and expertise in Turkey will enable us to fulfill our expansion plans.
As in the soda ash business, we want to grow very fast and have ambitious targets for our European production.
PARK GLASS PROVED ITS SUCCESS
Will there be additional difficulties in identifying and recruiting suitably qualified staff in Belgium and the UK?
Ciner Glass is proud of the intensive training and development program we have established with our technology suppliers. This program has proven quite successful in Turkey, our Park Glass facility. We made the decision to employ only a small proportion of staff with previous experience in the glass industry and instead to train the hundreds of people we need ourselves.
Our preferred strategy is to employ young people from the local community who do not have preconceived notions about ‘old-fashioned’ glass production. Ciner Glass wants to recruit open-minded people with whom we can share our values of working together, like in a family.
Will the new facilities adopt Park Glass’s plan, or will completely different models be needed?
We are proud of our facility in Turkey, but we want to add something to this success with each new facility. We are making some design changes to ensure that the efficiency and effectiveness of the buildings are even more innovative and state-of-the-art than Bozüyük.
3rd AND 4th FURNACES WILL BE ACTIVE
You also mentioned the continuous investment in the activities of Park Glass in Turkey?
Our expansion to Europe does not come at the expense of our advanced production activities in Bozüyük, which is located in the middle between Ankara and Istanbul. Bozüyük continues to be known for its quality and high production efficiency levels. Due to the increasing and skyrocketing demand during the epidemic, we are increasing the production capacity there as well.
As we mentioned in our last interview in 2015, the Bozüyük production facility, which was built from scratch, was designed to allow for increased production in the future, in addition to the two 500 tons per day furnaces built at that time. The construction of the 500-tonne furnace on the third day in Bozüyük has already been completed, and we aim to start the construction of a fourth furnace in the first half of 2022, to be located near our soda ash plant in Ankara.
The environmental assessment of the fourth project was recently approved and construction began. It will be the world’s largest rear-fired regenerative furnace with a capacity of 650 tons per day.
Integrated with our soda ash facility, the location of the fourth furnace in Ankara has additional logistical benefits. A railroad will be built to supply raw materials to our glass manufacturing facility and we will have the added advantage of integrating our electricity supply.
GW: Having already worked with leading suppliers such as Bottero Glass Technologies, TECO Group, Tiama, EMS Group, Lahti Glass Technology, Glassworks Hounsell, Global Combustion Systems, Heye International, KTG Engineering, Novaxion, Ramsey Products, Revimac, DSF Refractories & Minerals, RHI Magnesita, ACSI, AGR International, Antonini, Bohemi Chemicals and XPAR Vision have you identified partners for the proposed greenfield investment in Europe and expansion in Turkey?
We are considering using the same consortium as the original investment for the third furnace project in Turkey. However, the fourth furnace to be established in Turkey, as well as the furnaces to be built in Belgium and England, will be open to tender.
In addition to the projected Belgian and UK projects, do you hope to establish similar glass plants in other parts of the world such as the USA? If so, in which regions and after how long?
There is another place we are seriously considering, although it is too early to talk about it. We are in talks with customers and are currently looking for suitable locations. You can expect to hear more about Ciner Glass in the future.