Drums still major players
By Albert Genna -- Purchasing, 7/15/1999 6:00:00 AM
Despite inroads made by IBCs and fibcs, the 55-gallon drum is still a major player in bulk handling--and that's not going to change anytime soon. But there has been a significant consolidation of suppliers in the industry, and some drum-makers are pursuing a similar strategy to the IBC suppliers--offering extra value-added services to ensure that drums maintain their share of the bulk-packaging market.
It seems that drum companies are planning to provide the same sort of full-service operations that key IBC companies are headed toward, with some offering plastic, metal, and fiber drums. Others have formed alliances to increase geographic sales reach. Several drum suppliers are offering logistics services similar to those offered by IBC suppliers. Drum suppliers are finding that customers want to outsource what they used to do themselves, and don't want to put in the investment needed to manage their container fleets.
Steel drums' tough stance
Despite the inroads made by such containers as IBCs and plastic drums, steel drums continue to hold their own. Competition may have slowed the growth of steel, but the impact has not been as dramatic as some expected. For many applications, steel remains the best choice. Steel drums offer strength, fire-resistance, reconditioning options, and easy recyclability. As well, they offer a standardization that makes them compatible with handling equipment all over the world. The steel drum is in many ways universal, and almost all materials can be put into them. Materials that are corrosive to steel, or those with sanitary concerns, need plastic liners.
All steel drums are reconditionable, although some can't be reused for hazardous materials because of the drum wall thickness. There is an asset value to this reconditioning, because drums can be used again many times over. And when a drum needs to be put out of service, there is a strong aftermarket for the steel.
Demand for steel drums so far in '99 has been mixed. "Demand has been slightly down this year, due mainly to the Asian economic situation and the chemical business being a bit slow," says Scott Marple, product manager for steel drums at Grief Bros. "However, we remain optimistic." But the Asian problem hasn't affected all steel drum makers. "Demand has been very good, despite the Asian economic hangover--the domestic market is carrying the load," says Jim Heffernan, vice president, Trilla Steel Drum. "We expect demand to stay steady for the rest of the year, and if Asia gets healthier, that can only help."
Suppliers in the drum business want to allow for "one-stop shopping," just like IBC suppliers. In March, five independent steel drum manufacturers--CP Louisiana, Inc.; Nesco Container Corp.; General Steel Drum Corp.; North Coast Container Corp.; and Trilla Steel Drum formed a new venture: Containers America LLC. The newly formed venture offers multi-plant users with a one-source bulk packaging supplier over geographic areas that each company individually couldn't serve. And In May, Trilla Steel Drum and Russell-Stanley formed a strategic alliance, offering its dual customer base a single source for plastic and steel industrial containers. As many customers use both steel and plastic drums, and the two companies did not compete in the same geographical areas, the fit seems logical.
Despite the strength of a standard product, drum companies are always providing new designs. "We're now making a drum under a process that assists in high performance. We start with a smaller tube, and expand the shell, making the drums stronger. We're finding that this expanding process is the best way to go," says Heffernan at Trilla.
Another style of drum also is proving increasingly popular: "The W-hoop style drum is going to be the standard in the future," says Marple at Grief Bros.
Plastic drums make further inroads
Plastic drums are most commonly used in the food and beverage industries, but manufacturers expect to see growth in other applications including plastics, resins, and pigments. There are a few drawbacks to plastic drums, including incompatibility with concentrated chemical solvents and not meeting safety criteria for storing many flammable materials. But there is still potential for plastic drum use to grow.
Producers expect applications where there are purity and sanitary concerns to help fuel plastic drum growth. One area of strong growth for plastic drums will likely be in the open-head plastic drum, where open-head poly-drums are replacing fiber drums in many applications.
"Demand is strong and growing,'' says Jim Craig, product manager for plastic drums at Greif Bros. "We're continuing to see some migration from other containers into plastic, but the price of plastic resins dictates how fast that happens. Plastic container prices mostly follow changes in hdpe (high-density polyethylene) prices." Continued growth is projected for plastic drums. Main area for growth is food products that go into FDA-approved plastic containers.
Plastic drums also have access to a network of reconditioners. While not as elaborate as the long-standing steel container reconditioner industry, this side of the business is growing and should give plastic drum users some good options for reconditioning drums. According to producers, poly drums can make 5-10 trips, then reconditioners can wash and recertify the drums. The plastic drum reconditioners are becoming more sophisticated. If unable to be recertified, the drum can be ground up for recycling.
Fiber drums find surprising stability
In an era of reusable bulk containers, the fiber drum faces significant challenges because it is essentially a one-way container. Furthermore, fiber has been effectively pushed out of the hazardous-materials markets by safety regulations. Fiber drums now seem most at risk from open-head plastic drums, mostly because these poly drums can now meet the UN/DOT testing criteria. But, the fiber drum will not vanish from the scene. For many applications the container is an economical choice. And producers are pushing the drums toward new non-hazardous applications such as holding paints and other liquids by using integrated liners. Fiber drums have a good stronghold because they are significantly cheaper than plastic or steel drums. As well, they continue to be used in powder applications, and liquid/semi-liquid applications are growing.
Demand has been steady, not growing a lot. "Fiber drums are a mature market," says Pat Griendling, product manager for fiber drums at Grief Bros. "But we still see a viable market.'' In fact Grief has built a new facility for fiber drums near St. Louis, and some areas are increasing their fiber drum use: Pharmaceutical chemicals and food ingredients, for example. And there are advantages: "They are still considered easy to dispose of, and with different liners you can put many things in them," she says.
Watch paper prices to see where fiber drum tags are headed. "Paper prices have been increasing, but so have resin prices--so there's not much of a market shift when raw-material prices for both plastic drums and fiber drums go up," says Chuck Wyack at Michael's Cooperage.
Drums
Steel drums
- Steel drums allow for easy transportation and provide resistance to heat and fire.
- They can be used with flammable materials.
- They can be reused, reconditioned, and are easily recyclable.
- Has a strong national network of steel container reconditioners.
Plastic drums
- Plastic drums are lightweight and non-corrosive.
- Provide impact resistance and strength from one-piece construction.
- Provide good general chemical resistance and won't rust or flake
- Meet many DOT criteria for transporting hazardous materials.
Fiber drums
- Fiber drums are lightweight and provide easy handling.
- They can be water- and weather-resistant.
- Are the cheapest bulk packaging for dry materials.
- All parts of a fiber drum can be recycled.
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