Capsules in transition: will elevated cost drum tin out of the competition?

"We have seen wineries convert from tin to aluminum as well as polylam," said Hanson-Jerrard at Lafitte. "This has been especially so for wineries that have used tin for an extended length of time, and have for the first time tested these two alternatives and found (that) the improvements that have been made in quality have made them viable alternatives, which have saved them costs with minimal differences in quality."

Although Lafitte reported a 40% sales growth in tin capsules in 2007, primarily from boutique wineries, "As the year went on, more and more wines finished in tin that retail at $20-25 and under began asking to look at alternatives," Hanson-Jerrard said. "I think that as we move forward, sales of tin in the U.S. market will decline in 2008, based upon the losses to other materials in the under $20 per bottle range. However, at the higher end of the price spectrum, I think the future of tin is relatively safe, and we do not see many wineries in the over $25/bottle segment currently looking seriously at the alternatives. Of course, the bottom line is if the raw material prices continue to increase at the current rate, the story in two years may be somewhat different."

Graham Wilson predicted: "Tin will eventually be phased out if there is no market for it ... due to the high prices. Polylam material is a good and cheaper replacement ... the looks are very much alike."

But Jeremy Bell at Rivercap observed, "So far, there has been no change in the buying patterns of our customers. Tin is seen as the top quality material for capsules, and will always be the first choice for boutique wineries. Even among larger producers, tin is the preference for premium wines in the $15 and up range. It clearly has the best appearance, and is easier to apply than polylam, with fewer problems on the bottling line."

Bill Bronson at Diablo Valley Packaging in Fairfield, Calif., said his company is primarily a supplier of glass containers, but sells tin capsules as a secondary item. "My observation," he said, "is that some vintners feel the necessity to go for tin, (just) as they feel obligated to purchase heavyweight bottles. It is an image that they want to portray.

Bell agreed. "Packaging is a critical part of the wine business, and the majority of designers would prefer to use tin for its flexibility and the ability to achieve elegant and intricate designs," he concluded. "I do not see tin being replaced by any other material for premium wine packaging, as there is nothing else that works as well or looks as good."

* As prices for raw material and shipping rise drastically, traditional tin capsules may become as endangered as the lead capsules they replaced two decades ago.

* Increased Chinese use of tin for soldering electronics; closures of tin mines in areas with political unrest; and speculation in the commodities markets have contributed to the escalating costs.