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Bottle maker expands to fully supply beverage industry

Allocates 1.5 billion birr for three production lines

The sole manufacturer of glasses and bottles in the country, the Addis Ababa Bottles and Glasses SC, has been working on expanding its production line where recently it has increased the daily production to 81 million bottles from the existing 20 million per year.

Established in 1976, the factory, which is located at Asko locality, northern western part of Addis Ababa, has launched an expansion project targeting to fully address the demand gap that has existed for long in the beverage industry. According to Siemen Bekele, deputy general manager of the company, currently, the demand for bottles and glasses remain at 65,000 tons per year. The Addis Ababa Bottles and Glasses SC, however, has been able to supply the industry with 25,000 tons.

Siemen claimed that following the successful completion of three phases of the expansion project a year-and-a-half later, the factory will manufacture at full capacity to address the required demand for bottles and glasses for which the entire beer industry, alcohol and wineries, cosmetics plants and the like depended on. However, the huge gap in the supply side forced the likes of Diageo to import bottles and glasses from abroad.

Following the acute shortage, the company has set aside some 1.5 billion birr for expansion. Siemen said that in the last ten months’ time, the factory was able to install a production line with a total capacity of manufacturing 53 million bottles per year or 50 tons per day. The second phase of the production line, which is scheduled to be complete within ten months’ time, is expected to expand the production capacity to 160 million tons of bottles. Similarly, at the completion of the third production line, the capacity is expected to reach at 250 million bottles per year.

The likes of BGI-Ethiopia, which bottles St. George Beer, have been facing shortages of export standard-light weight- bottles manufactured locally. The bottle manufacturer targets to tap into that market segment and scale up the existing small scale manufacturing unit. In addition to that, Siemen said that the factory is considering the production of water bottling glasses in a view to diminish the vast production of plastic bottles in the country.

The increasing expansion and introduction of beer factories in the country has caused supply side constraints in the country. According to reports, on average, some 25 million dollars valued bottles and glasses have been imported annually to address the gap. Siemen hopes that the new plant will substitute importations of 11 million dollars’ worth of bottles.

Privatized six years ago for 66 million birr, the factory which started operations with a capacity of 20 million bottles a year four decades ago, recently has attracted Greaytop PLC; a Chinese firm in a joint venture with the locally-based Bazeto Industry and Trading PLC sharing 50 percent stake each. According to Siemen, the total capital of Addis Ababa Bottles and Glasses SC accumulated valued at some half a billion birr.

Employing 40 percent of broken pieces of bottles and glasses (cullet) as raw material, the factory operates on silica sand, soda ash and the like. Depending heavily on electric power as source of energy, 4MW power has been installed with possibilities of climbing to demand 11MW electricity at the end of the expansion project.