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Imported bottled water drowning local producers
published: Sunday | May 29, 2005
Susan Smith, Staff Reporter
.
JAMAICA IS known as the land of wood and water, but the country still imports more than ten times the amount of water it exports.
For good or ill, begging a drink of water is no longer common in Jamaica. Fuelled by fears about the quality of what is coming out of our taps, the bottled water industry has come of age, even cutting into the consumption of some other beverages.
The National Water Commission (NWC) estimates that the average person uses approximately 37.5 gallons of water per month for drinking and cooking, and consumption trends over the last 10 years show that an increasing portion of that consists of the bottled variety.
But while foreign producers have found it easy to access the domestic market, exporters have struggled to return the favour.
MARKET FLOODED
Major local bottlers say the Jamaican market is being flooded with imports. They say the imports have easily filtered into the market because global prices are so low.
Managing Director of Peak Bottling Company, David Wong, says there are more than 42 different brands of bottled water being sold in the Jamaican market. On the other hand just about five companies, including Peak Bottling Company, Jamaica Drink Company Limited and Lewcan Enterprises are involved in exports.
They sell their products to North America, Holland, Britain and the Caribbean, which is one of their most lucrative markets.
The latest figures from the Statistical Institute of Jamaica show that 304,111 litres of flavourless mineral water, valued at J$10.1 million was imported in the first half of 2004, while 22,479 litres, valued at J$1.36 million was exported for the same period.
Likewise, 954,576 litres of ordinary natural water, priced at J$35.6 million was imported versus the 104,194 litres exported.
"The water industry is very localised around the world," said director of beverage manufacturing at Jamaica Drink Company Limited, François Chalifour explaining the drastic imbalance between import and export.
He pointed out that the price for bottled water on the international market presents stiff competition
Company Limited, François Chalifour explaining the drastic imbalance between import and export.
He pointed out that the price for bottled water on the international market presents stiff competition for the local companies which process, sell and export bottled water.
The local producers also have to contend with the large volume of imports into the island which cuts into their domestic market. "Imported bottled water comes in from as far as Thailand," said Mr. Wong.
The sentiment from most of the local players is that much of the water being imported is of inferior quality to the local brands.
"The market in North America is a lot more developed," said Mr. Chalifour. "It is difficult from a price point of view. Price is much more competitive. A lot of the cost goes into packaging. "
Mr. Wong confirmed that the export of bottled water is not as attractive because of the pricing of the raw material that is involved.
"For us, we do spring water and find that people like the quality of our water but to compete against the domestic product in Miami is not viable. You can't compete in Florida," he said, stressing that the main consideration is the price.
The 500 ml bottle of water can be purchased in Canadian supermarkets in Canada for US$4.50 per case explained a local retailer. A case of 24 bottles of water locally produced may cost J$680 or US$11 on a Jamaican shelf.
OVERCOMING CHALLENGES
Mr. Chalifour said the prospects for growth in bottled water export lie in brand definition. "Jamaica's claim to fame in the import market in North America is more on the traditional products. It takes longer for us to convince them of the uniqueness of our water," explained Mr. Chalifour.
Jamaica may have to find an anchor in niche markets in order to effectively compete in exports is Mr. Wong's take on the matter. "You may try to get the niche market of Jamaicans because water is water is water," he said. "Exports have to be more on the high end. In places like Japan for example people are not reserved to pay extra money for water."
Along with this Mr. Wong believes the Government should do more to protect the product. "Barbados and Trinidad will put on duties to protect the price."
Director at Lewcan enterprises, Headley Lewis suggest that the Government waive the cost of importing plastic bottles as a start to lower the cost of export.
DOMESTIC MARKET
He said for the local producers to remain competitive, more consumer education needs to be done. "In the local market it is not about price but the benefits," he pointed out agreeing that the local market is more than saturated.
He said consumers should be wary of bottled water label which say 'purified' yet display a string of additives in small print. Additives make the product artificial.
"Our product is comparable to 'Evian' out of France which has been in the market for years," said Mr Wong.
To address concerns about the quality of bottled water, the Bureau of Standards maintains a register of local producers. As at September 21, 2004, the following producers were on record: -
Barco Caribbean Limited
Caribbean Spring Drinking Water
Ramble Enterprise:
Jamaica Drink Company Limited
Jamaica Spring Water Co. Ltd.
Woodland District
Mekyah Jamaica Limited
Nature Pure Bottling Company
Peak Bottling Company Limited
Pepsi-Cola Jamaica Bottling Company Limited
Spar Bottling
The Water Company
Cool Runnings Spring Water Co. Ltd.
Montego Bay Ice Company Limited
published: Sunday | May 29, 2005
Susan Smith, Staff Reporter
.
JAMAICA IS known as the land of wood and water, but the country still imports more than ten times the amount of water it exports.
For good or ill, begging a drink of water is no longer common in Jamaica. Fuelled by fears about the quality of what is coming out of our taps, the bottled water industry has come of age, even cutting into the consumption of some other beverages.
The National Water Commission (NWC) estimates that the average person uses approximately 37.5 gallons of water per month for drinking and cooking, and consumption trends over the last 10 years show that an increasing portion of that consists of the bottled variety.
But while foreign producers have found it easy to access the domestic market, exporters have struggled to return the favour.
MARKET FLOODED
Major local bottlers say the Jamaican market is being flooded with imports. They say the imports have easily filtered into the market because global prices are so low.
Managing Director of Peak Bottling Company, David Wong, says there are more than 42 different brands of bottled water being sold in the Jamaican market. On the other hand just about five companies, including Peak Bottling Company, Jamaica Drink Company Limited and Lewcan Enterprises are involved in exports.
They sell their products to North America, Holland, Britain and the Caribbean, which is one of their most lucrative markets.
The latest figures from the Statistical Institute of Jamaica show that 304,111 litres of flavourless mineral water, valued at J$10.1 million was imported in the first half of 2004, while 22,479 litres, valued at J$1.36 million was exported for the same period.
Likewise, 954,576 litres of ordinary natural water, priced at J$35.6 million was imported versus the 104,194 litres exported.
"The water industry is very localised around the world," said director of beverage manufacturing at Jamaica Drink Company Limited, François Chalifour explaining the drastic imbalance between import and export.
He pointed out that the price for bottled water on the international market presents stiff competition
Company Limited, François Chalifour explaining the drastic imbalance between import and export.
He pointed out that the price for bottled water on the international market presents stiff competition for the local companies which process, sell and export bottled water.
The local producers also have to contend with the large volume of imports into the island which cuts into their domestic market. "Imported bottled water comes in from as far as Thailand," said Mr. Wong.
The sentiment from most of the local players is that much of the water being imported is of inferior quality to the local brands.
"The market in North America is a lot more developed," said Mr. Chalifour. "It is difficult from a price point of view. Price is much more competitive. A lot of the cost goes into packaging. "
Mr. Wong confirmed that the export of bottled water is not as attractive because of the pricing of the raw material that is involved.
"For us, we do spring water and find that people like the quality of our water but to compete against the domestic product in Miami is not viable. You can't compete in Florida," he said, stressing that the main consideration is the price.
The 500 ml bottle of water can be purchased in Canadian supermarkets in Canada for US$4.50 per case explained a local retailer. A case of 24 bottles of water locally produced may cost J$680 or US$11 on a Jamaican shelf.
OVERCOMING CHALLENGES
Mr. Chalifour said the prospects for growth in bottled water export lie in brand definition. "Jamaica's claim to fame in the import market in North America is more on the traditional products. It takes longer for us to convince them of the uniqueness of our water," explained Mr. Chalifour.
Jamaica may have to find an anchor in niche markets in order to effectively compete in exports is Mr. Wong's take on the matter. "You may try to get the niche market of Jamaicans because water is water is water," he said. "Exports have to be more on the high end. In places like Japan for example people are not reserved to pay extra money for water."
Along with this Mr. Wong believes the Government should do more to protect the product. "Barbados and Trinidad will put on duties to protect the price."
Director at Lewcan enterprises, Headley Lewis suggest that the Government waive the cost of importing plastic bottles as a start to lower the cost of export.
DOMESTIC MARKET
He said for the local producers to remain competitive, more consumer education needs to be done. "In the local market it is not about price but the benefits," he pointed out agreeing that the local market is more than saturated.
He said consumers should be wary of bottled water label which say 'purified' yet display a string of additives in small print. Additives make the product artificial.
"Our product is comparable to 'Evian' out of France which has been in the market for years," said Mr Wong.
To address concerns about the quality of bottled water, the Bureau of Standards maintains a register of local producers. As at September 21, 2004, the following producers were on record: -
Barco Caribbean Limited
Caribbean Spring Drinking Water
Ramble Enterprise:
Jamaica Drink Company Limited
Jamaica Spring Water Co. Ltd.
Woodland District
Mekyah Jamaica Limited
Nature Pure Bottling Company
Peak Bottling Company Limited
Pepsi-Cola Jamaica Bottling Company Limited
Spar Bottling
The Water Company
Cool Runnings Spring Water Co. Ltd.
Montego Bay Ice Company Limited
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