By James Atkinson

Glass packaging manufacturer Owens-Illinois (O-I) has attributed the downsizing of its Melbourne plant operations to a decline in Australian beer and wine consumption.

O-I, which recently developed the packaging for Carlton United Brewers' new Victoria Pale Lager, last week announced it will cut the number of furnaces at its Melbourne Plant from three to two and reduce the workforce by around 70 positions.

O-I Australia general manager Brian Slingsby said the decision followed ongoing deterioration in market conditions in Australia and weak consumer sentiment.

"This has led to declining food and beverage sales across the country, particularly in the beer and wine segments," he said.

Slingsby told TheShout per capita consumption of beer in Australia is at its lowest rate in around 60 years.

"Combined with an increase in bulk wine shipping to the USA and UK and a high Australian dollar (which assists imports), these conditions have led to a decrease in the demand for glass packaging in this country," he said.

"There remains however many opportunities for us in this market including the increases in craft beer and cider consumption."

The furnace will close by March 31. As well as the two Melbourne furnaces, O-I will retain plants in Adelaide, Sydney and Brisbane – 10 furnaces in all.

The Shout Team

The leading online news service for Australia's beer, wine, spirits and hospitality industries.

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