Cold comfort

For consumers, this means the return of soft drink shortages.

“Stocks throughout the system have been affected and we're obviously having a tough April. We've had to cut gas supply completely in the less important lines,” says Afrox MD Tjaart Kruger.

Production at Afrox, which supplies CO² to soft drink manufacturers, was disrupted more than a year ago because of problems at PetroSA, the supplier of CO² to Afrox. Kruger told the FM at the time that Afrox had resorted to importing “a lot of gas” from abroad.

Now, soft drink manufacturers, still reeling from last year's bottle shortages, are scaling down on the production of certain products. For its part, SABMiller's local soft drink unit, ABI, says it has put contingency plans in place to meet consumer demand during this period, but could not say what the shortages mean for the supply chain, or quantify the impact.

“ABI has been affected by constraints in the supply grid along with all other soft drink bottlers,” says SAB communications manager Janine van Stolk. “We expect CO² stocks to be tight in the coming months.”

The shortages mean huge losses for bottlers and other industries. High demand for Afrox products in other areas means households that have been hit by Eskom's rolling blackouts, and have resorted to using gas appliances, may find it harder to fill their gas tanks, particularly as winter sets in.

However, Afrox's splurge on liquid petroleum gas storage facilities, bulk tankers and cylinders could alleviate some of the pressure. Last year, Afrox, owned by German group Linde, grew operating profits by 19% to R854m.

Source: Financial Mail

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