POLAND: FLAT, HOLLOW & SPECIALITY GLASS MARKET REPORT

During the past few years Poland has managed to boost glass production, cutting down imports from the east. More promising opportunities are now believed to lie in the west, explains Vladislav Vorotnikov. The full version of this article appears in the Nov/Dec issue that has been mailed globally and is also now available free of charge in the digital archive*.

POLAND: FLAT, HOLLOW & SPECIALITY GLASS MARKET REPORT

The Covid-19 pandemic brought a short and yet troublesome period of uncertainty for Polish glass plants in 2020. The first lockdowns drove the demand for float glass on both the domestic and foreign markets down in April, said Paweł Górski, Sales Director of Pilkington Polska’s primary production department.

The decline was not even. It was significant for some customers and imperceptible for others: quite strong in the internal glazing segment and much smaller for external glazing,” Mr Górski added.

In April, we recorded a drop in sales by a dozen or so percent compared to the same month of the previous year,” reported Mariusz Kołodziej, Sales Director of Pilkington IGP architectural glass department. “However, it should be added that the demand for insulating glass units in April 2019 was exceptionally high.”

The pandemic has not prevented Polish glass producers from improving operational performance. In 2020, flat glass production totalled 150 million m2, compared to 144 million m2 in 2019, and 101 million m2 in 2018, the Government estimated.

Piotr Kardas, Secretary General of Polish Glass said: “During the last five years, flat glass companies present on the Polish market have massively invested in their production lines modernisation. Thanks to these expanded capacities, Poland today is the third biggest flat glass producer in Europe with a production of around 1.5 million tonnes per year.

Production is expected to keep growing thanks to new investments from major players. In 2020, Guardian Glass launched its second float glass line in Częstochowa to help meet growing demand for high-performance coated and fabricated glass products in Poland and throughout Eastern Europe.

The new flat line has a nominal capacity of 1,000 metric tonnes of glass per day, while the new coater represents the latest in technology for Guardian and, we believe, for the industry,” said Guus Boekhoudt, Guardian Glass Executive Vice President.

In March of 2021, Pilkington IGP announced plans to expand its float glass plant in Ostrołęka, doubling its production capacity.

Krzysztof Granicki, President of Pilkington Polska, commented: “Our industry performed well during the pandemic, so we decided to continue the previously planned modernisation of the Ostrołęka plant. In 2019, we also completed the construction of a new glass processing plant in Białystok. Our investments are a response to the growing demand on the construction and architectural market.

More flat glass is needed

In 2019, Poland exported $116 million worth of flat glass, making it the world’s 14th largest exporter of float glass, the Observatory of Economic Complexity estimated. The country imported float glass worth $206 million, becoming the world’s fourth-largest importer in this sector. In addition to Germany and Italy, Poland purchases float glass from eastern countries – Russia and Belarus.

The Covid-19 pandemic hampered the domestic demand for building materials in 2020, but long-term projections are bright since numerous European governments are launching infrastructure projects to support their crisis-ridden economies, and this factor aids the building industry and may cause a shortage of building materials, including glass.

We must take into account that in the coming years, we will function permanently in a situation of a certain unpredictability of the prices for building materials,” said Jan Styliński, President of the Polish Association of Construction Employers. “Many materials are simply hard to source today. In a situation where most European countries will allocate huge investments [under infrastructure project] in the near future, these resources will be needed in various parts of Europe.”

In the past few years, export has been steadily growing, while imports tend to shrink. New capacities are expected to bolster these trends.

According to Bogdan Pęski, President of the Management Board of BD Art, which is mulling over plans to build a new glass plant in Leszkowice designed to produce 20 million m2 of flat glass per year with a photovoltaic farm and sand mine, “We have huge reserves of sand in Poland and could be much bigger producers, but we do not use our opportunities. We have too few glass factories. Polish companies have to import glass from Russia, Turkey, and China.

Poland has room to boost flat glass production by as much as 50%, taking advantage of good price conjuncture, said Mr Pęski. In 2020, the price for flat glass jumped by half, and several rounds of price increase have been already registered this year, with prices remaining high both on the domestic and foreign markets, he added.

The European glass industry is passing through a transformation, with Poland expected to begin playing a more important role in the EU’s glass market in the next few years.

In Western Europe, outdated and inefficient glass plants not meeting environmental standards are being liquidated, and new ones are not being built – developers are erecting office buildings and housing estates on the reclaimed land,” said Mr Pęski, adding that Western Europe will likely need more glass from Poland, and bright export opportunities are observed in other regions of the world – North and South America, as well as Asia.

BD Art [a Polish manufacturer of mirrors and frames] has received a construction permit from the Government and is searching for investors to launch the project.

Hollow glass enjoys rising popularity

The Covid-19 pandemic has also hit Polish hollow glass producers, but the setback has only been short-term. In the long run, glass containers producers are expected to take advantage of new European environmental campaigns.

At the beginning of the pandemic, we had to face considerable fluctuations in orders and sales,” said Artur Woloszyn, CEO of glass bottle manufacturer Stoelzle Czestochowa. “We also encountered difficulties in logistics, mainly related to maritime transport. They were caused not only by the pandemic but also resulted from the crisis in the Suez Canal and from ports that did not have adequate capacities. It was a challenge to deliver as flexibly and fast as usual, and we had to store more finished goods than expected in our warehouses.” Mr Woloszyn noted that the company recorded an increase in sales, starting in the second part of the pandemic, and was able to acquire new customers.

The introduction of an additional tax on spirits bottles with a capacity below 300ml has severely impacted the Polish glass containers market. Along with the Covid-19 pandemic, this tax caused a 20% sales drop in 2020, Woloszyn estimated. The picture was similar in the rest of Europe, which also took a toll since Stoelzle Czestochowa exports 90% of glass containers.

Many of our Prestige Spirits and cosmetics customers faced significant challenges during the lockdowns when restaurants, hotels, and airports were shut,” reported Mr Woloszyn. “[Requirements for] wearing masks and working remotely also had a huge impact on the sales of glass packaging in the cosmetics segment. However, since Europe started to open up, we have experienced a still persisting increase in orders and sales.

Focusing on the future

According to Mr Woloszyn, the glass collecting system and cullet usage in the glass industry have not been developed well in Poland so far. However, thanks to the European Green Initiative, things are about to change. The market demands eco-friendly packaging, and many brands have been switching to use glass packaging.

The use of cullet in glass production will motivate consumers to collect glass further,” believes Mr Woloszyn. “Using cullet is just one cornerstone in our Glass Group’s CSR strategy, which also includes the implementation of energy-saving technologies, the installation of photovoltaic panels, and many social initiatives such as planting trees, collecting waste, and cleaning up of local areas. Our main target is to reduce to the maximum possible extent our impact on nature and to raise consciousness among our 3,100 employees group-wide.”

However, the years before the pandemic were marked by a growing demand for glass containers. To some extent, this is happening in line with global trends of customers switching from plastic packaging.

We notice a very positive trend on the Polish market: many brands, including mineral water and juices – are switching to glass packaging from other packaging materials,” observed Mr Woloszyn. “Consumers appreciate that glass is 100% recyclable, natural, and inert, which means that food and beverages remain perfectly tasty and delicious."

This trend allows us to invest and to grow. At Stoelzle Czestochowa, we are currently implementing new tools for process management and automation, building a huge logistics centre (20,000m2), and preparing a furnace to be rebuilt in 2022. For Stoelzle, the future seems to be bright, with many opportunities and success,” he concluded.

About the Author: 

Vladislav Vorotnikov is an independent international journalist

Further Information: 

* The full version of this article appears in the Nov/Dec issue that has been mailed globally. The digital version of this issue can also currently be read free of charge in its entirety alongside back copies in the Digital Archive (sponsored by FIC) at https://www.glassworldwide.co.uk/Digital-Issues. To receive the paper copy, all future issues and a free copy of the Who’s Who / Annual Review 2021-22 yearbook, subscribe now at https://www.glassworldwide.co.uk/subscription-choice

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