In this, our annual look at the state of wine capsule usage, we see that the decorative sheath covering a wine bottle's closure and neck continues to make strides in quality and design. While trends in overall capsule usage change gradually over time, shifts in the last year or two are evident and appear to be in response to wineries' goals toward more economical packaging, convenience and a higher quality product.
According to Greg Fulford, president of ColloPack Solutions in Napa, in today's capsule market, aesthetics and the quality of the capsule application are becoming more significant priorities. "Historically, if there were a few wrinkles in the capsule or if the top was scuffed, that was acceptable," said Fulford. "But today's market has become more particular, looking for capsules without defects by the time they reach the retail aisle."
Kyle Rossler, vice president of sales and marketing for G3 Enterprises in Modesto, California, said that convenience is king in today's market. "As I look at the evolution of packaging in retail--in everything--it's all about convenience," he said. Toward this, Rossler noted that the continued growth of screw caps, not only in California but all over the U.S., is a major development in the capsule and closure markets.
Improvements in wine packaging reflect the nature of the entire wine industry, which continues to mature and raise the bar on quality. Capsule manufacturers are no exception, constantly experimenting with better substrates, thicknesses, combinations, and design techniques that will result in a smoother, more interesting looking capsule.
Below we take a look at where the shifts in capsule usage have taken place over the past couple of years, why they have occurred, and what manufacturers are doing to keep capsules interesting in today's market.
Tin and Polylam
In the hierarchy of capsules, tin has always been regarded as the leader in quality, followed by polylam, aluminum and PVC. According to Wine Business Monthly's most recent Capsule Report (September 2006), 56 percent of wineries were using tin capsules in 2006 v. 37 percent in 2004 (this survey is conducted every other year). According to winery size, tin is most popular with smaller wineries, who reported using it on 62 percent of their production (v. large wineries who use it on only 18 percent of production).
In recent years there have been significant increases in the price of tin. In a January 2007 Purchasing.com article discussing the price fluctuations of tin, the over 30 percent demand surge in the past four years can be attributed to a few different things, including: an increase in the use of tin-plated steel in China; fears of a global supply shortage (fueled by a crackdown on illegal mining in Indonesia, one of the world's biggest producers); and the European Union's ban on the use of lead in electrical components. According to Infomine.com, tin today is selling for about $6.50 a pound, a year ago it was selling for $3.50 and in October of 2002 it was down to $2 a pound.
Of the four main capsule types (tin, polylam, aluminum and PVC), tin and polylam are most closely related because of their elegant appearance. A key difference is that tin is a one-piece, seamless capsule while polylam capsules are two-piece, seamed capsules. But now, due to the rising price of tin and the improved capabilities of polylam, polylam capsules have been gaining new popularity among winemakers.
"We can now get polylam capsules that have an appearance like tin if sized and printed correctly, and by using a good substrate," said Fulford. "Polylam doesn't feel exactly the same as tin, it's got a softer feel, but on the retail shelf, from arm's length, it looks pretty close."
Alexandrine Janson, of Janson Capsules, agrees that tin has been taking a hit. "Due to the cost increases of raw tin, we are facing an increased demand for polylam capsules," she said. "Today's polylam capsules have a similar appearance to tin capsules and adapt very easily on the bottling lines, without major adjustments." Janson Capsules, serving primarily mid-sized and large wineries, is the second-largest capsule manufacturer in Europe (behind Enoplastic), with three plants in France and one in Alabama, manufacturing over 1 billion PVC and polylam capsules annually.
But while tin gives up some of its market share, mainly to polylam and screw caps, most manufacturers and distributors agree that it will always remain a strong option among larger, high-end and boutique wineries. "Tin will never be totally replaced by polylam because of the perceptions held by marketers and winemakers," said Rossler.
Dave Hanson-Jerrard, president and general manager of Napa's Lafitte Cork & Capsule (selling tin, polylam, PVC and aluminum capsules), said that although everyone's complaining about the price of tin, which he said has gone up "tremendously in the last three years," it's still selling. "I'm not sure where it's going [the price of tin], but they think it's stabilized for now," he said, adding that tin capsule sales in the U.S. market are mostly driven by the strong growth in premium brands.
The array of decorative techniques used on capsules also continues to expand. Capsules can be hot-stamped with foils, four-color printed, and embossed with logos and designs on top of the capsule as well as along the sides. Lafitte is doing its part to keep things fresh with the introduction of its DH4 Process, an exclusive proprietary formula for creating holographic-like images onto polylam capsules.
To create the unique DH4 Process image, the metal cylinder is etched with the design, which is then rolled through ink and then onto the polylaminate material. According to Hanson-Jerrard, the price is basically the same as a similarly designed polylam capsule but with an extra cylinder set-up fee. He also added that polylam can now be printed with virtually limitless colors that can be blended, graduated and morphed.
Sparflex California's success in capsule sales (tin, polylam, PVC, foil/wire hoods) is enabling the company to invest in new equipment and expand manufacturing for the North American market. General manager Eduardo Bastos-Amaro said the company has invested over $5 million on a new laminator for their polylam capsules and, as of August 1, opened a facility in Ukiah, California, that will produce up to 150 million polylam and PVC units a year to start. These capsules will be warehoused in Napa which, according to Bastos-Amaro, will also help serve another important slice of the industry that is looking for immediate stock on hand. "Another booming segment is stock sales," he said. "There is a large market out there of small wineries, micro-crush facilities, restaurants and amateur winemakers."
Sparflex's Luxalu polylam capsule, which it promotes as the "top of the range in glued capsules," has a look very similar to tin, and can be embossed with a crisp-looking design and with a silkscreen applied over the seam to give it an overall smooth appearance. The Luxalu is made of two sheets of aluminum surrounding a layer of polyethylene and costs $.05 to $.06 per capsule ($10 to $15 more than regular polylam capsules per 1,000, but the set-up fees are less). Luxalus are generally used on small runs up to 100,000 pieces. In addition, Sparflex now has the ability to emboss intertwined images on a tin capsule. "Most people can only do concentric or parallel designs," said Bastos-Amaro.
He agrees that despite the high cost of tin, he is still seeing a lot of interest in it by small and mid-sized wineries coming out with ultra-premium brands. "Tin is still very popular; everybody loves it, but not everyone can afford it."
PVC and Aluminum
PVC and aluminum capsules are used more frequently on value wine brands, and have seen some declines in usage with the growing popularity of polylam and screw caps. Hanson-Jerrard feels that PVC capsules, which are commonly found on wines retailing for less than $3 a bottle, are in a slow demise.
"PVC has died in the U.S.--for us it's become a commodity product," said Hanson-Jerrard. "Wineries choosing this capsule are looking for the cheapest option, not the highest quality," he said, noting that there are now fewer major wineries using PVC as they convert to polylam and a higher level of packaging quality.
So who is still using PVC? According to Hanson-Jerrard, smaller wineries outside of California are because of the prohibitive costs of upgrading their equipment from heat tunnels (used with PVC capsules) to spinners (used to apply tin, polylam and aluminum capsules).
Some very large wineries are also using PVC capsules on their cheapest wines. In 2006, survey respondents from large wineries said they used PVC capsules with 44 percent of their production.
In the wake of high-priced tin, some wineries have even rekindled their interest in aluminum because it is not only thinner and cheaper (20-25 percent) than tin, but has a tin-like appearance (both are seamless). Yet it is more delicate and has sharper edges when cut than tin, which is a detractor for many.
Overall, aluminum's popularity has been dropping off steadily in past years, and was reported to be the least popular capsule in our "2006 Capsule Report," being used by only 8 percent of wineries in 2006, compared to 10 percent in 2004. Large wineries reported using it on only 4 percent of production and small wineries on about 9 percent of production. Most manufacturers seem to be mainly using aluminum capsules nowadays for Champagne.
Screw Caps
While technically not a capsule, screw caps play an important part in the capsule discussion as they are a combination capsule and closure, and continue to grow in global popularity. Screw caps are primarily used with white wines, but there are more and more reds and rosés being gradually switched over to screw cap as well. Rossler of G3 Enterprises estimates that 4 to 6 percent of all bottled wines are now under screw cap, and the "2006 Capsule Report" revealed that 17 percent of winery respondents were using screw caps (20 percent of small wineries and only 4 percent of large wineries).
According to Alcan Packaging Capsules, in American Canyon, California, 1.5 billion screw caps were in use on wine bottles in 2006, with an estimated 2 billion to be in use by the end of 2007. However, globally speaking, the U.S. is still more concerned about screw cap usage than any other country, noted Alcan's general manager, Frederic Catteau. "The U.S. remains hesitant primarily because of the perception that started with Gallo jug wines in the 1970s that screw-capped wines are inferior," he said. "But at the same time, many U.S. wineries are also ready to make the switch since enough big name wineries have already done so."
Catteau said that what was predicted for screw cap usage in the last year or two has come true: "In 2008 many screw cap investments will finally be in place, and big volume wineries will be making the switch," he said, adding that this year wineries are still working out the marketing for this transition. The switch for many, said Catteau, has also partly been fueled by lingering quality issues surrounding cork.
Alcan, which has manufacturing sites in France, Canada and Australia, and also produces tin and polylam capsules, is now producing a total of around 200 million screw caps, with much of them being used in Australia and New Zealand, where screw cap usage is much more common (because they make more wines that are meant to be drunk sooner, such as Sauvignon Blanc and Pinot Gris) than in the U.S. New Zealand puts approximately 80-85 percent of its wines under screw cap and Australia about 40-45 percent.
A somewhat recent development in screw cap technology is the cap that mimics a tin capsule, having no visible frets (or ridges) where the cap unscrews. The fret, a plastic insert, is under the capsule. "It resembles tin so closely that some wineries have chosen to print 'twist off' on the outside," said Catteau, who said that their screw cap with the hidden fret, called the Stelvin "Lux," was launched in the U.S. last year and is mostly used by premium wineries. The Lux costs about 30 percent more than a typical screw cap. A mid-sized winery might pay around $.20 each ($200 per thousand), with cost breaks for larger volumes. Catteau adds that wineries can bring in a tin capsule and Alcan can replicate it in a screw cap form, realizing the same kind of embossing as with tin.
According to Rossler at G3, which sells tin, aluminum, PVC and polylam capsules (as well as screw caps and corks), today's new screw cap technology is mainly cosmetic in nature. "The smoother sides and the embossing on top of the cap are now gaining in popularity," he said. "The screw cap then starts to look like a capsule, and people like that."
Manufacturers also continue to develop new technologies that will enable screw cap liners to provide different amounts of oxygen exchange. For example, a composition of a tin layer inside the liner creates a lower OTR (oxygen transmission rate). "The future will bring even more variety in liners," said Catteau, who noted that Australian wineries prefer a tighter liner while U.S. wineries prefer a more breathable liner.
Production
Other companies are making improvements in capsule machinery. Canals Packaging has invested in new printing machines, security upgrades for existing machines and quality control systems. "These steps will allow us to improve quality while increasing production capacity," said Miguel Fusalba, commercial manager for Canal's parent company, Manufacturas Metalicas Canals, headquartered near Barcelona, Spain.
Fusalba also adds that a recently upgraded computer system will affect all aspects of production, resulting in more efficient order scheduling and shorter lead times. Canals manufactures capsules (polylaminate, aluminum, PVC and PVC-free/PET capsules, which are biodegradable) for the Spanish market and for export, with the U.S, its largest export destination.
Maverick Enterprises, based in Ukiah, California, carries polylam, PVC, Champagne foils and their Almost Tin capsule, a specialized aluminum and polylaminate capsule for customers transitioning away from tin. They also offer their BoB Closure System, which stands for "best of both," which has both a capsule skirt (to maintain the perception of quality) and a separate cap (to make opening the wine more accessible).
Maverick's newest product is the AnA screw cap, which is a threaded aluminum ROTE (roll-on, tamper evident) primary closure that has an easy opening and re-closing feature. The AnA is available in a variety of stock and custom colors, and can be applied using standard screw cap bottling equipment.
The efficiency factor of dispensing capsules is also gaining more attention nowadays, with wineries weighing the cost, quality and consistency benefits of hand-dispensing versus automatic dispensers. "We see a trend to reduce hand-dispensing by using a relatively inexpensive automatic dispenser," said Fulford, who adds that a machine dispensing and shrinking PVC capsules, or spinning down polylam or tin capsules, can be purchased for around $40,000.
Then again, using capsules may not even be in the cards for some wineries. Not everyone chooses to use them. According to the "2006 Capsule Report," 81 percent of respondents said they used capsules, a 14 percent drop from 2004, which may be explained by the increased use of alternative closures not requiring a separate capsule--mainly screw caps--but also wax finishes and other alternatives, such as the Zork or the Vino-Seal closures. wbm
Types of Capsules
Tin capsules cost between $.13 and $.18 each (between $.10 and $.12 each for large volumes). Tin is the most expensive capsule on the market and is generally used with premium wines, retailing for $15 and up. Tin, with its sleek, seamless finish and ease of application and removal, has traditionally had the highest quality perception among consumers. One-piece tin capsules are frequently silk-screened prior to application and are spun down onto the neck, allowing for a smooth surface without wrinkles. Tin is also softer than the other metal capsule, aluminum, thus making it easier to remove.
Polylaminate or "polylam" capsules cost between $.05 and $.06 each (between $.035 and $.045 for large volumes), and has a look and feel similar to tin but at less than half the price. Polylam capsules are usually used with wines retailing for between $7 and $15 a bottle, and on lower-priced wines that will be opened sooner than later. Polylam capsules are formed as sandwiches, with two sheets of aluminum encasing a sheet of LDPE (low density polyethylene). Polylam capsules differ from tin in that they are flat-printed and applied as a two-part capsule with a seam, but they can be applied by hand or spun down (similar to tin). Polylam capsules can be printed, embossed and hot-stamped, both onto the skirt and the top disc.
Aluminum capsules cost between $.10 and $.13 each (between $.065 and $.09 each for large volumes), and have a look that is similar to tin (both are seamless). Aluminum can be decorated in a similar way to tin but is thinner than tin; thus it is more delicate and has sharper edges when cut than tin (some people feel aluminum is awkward to remove from the bottle and are willing to pay more for tin because of its performance). Aluminum capsules are being used less by wineries today and are being carried by fewer vendors. Aluminum capsules are, however, still a very popular option for finishing Champagne bottles, which do not require a flat skirt finish.
PVC capsules are the least expensive capsules, costing between $.03 and $.05 each (between $.015 and $.03 for large volumes) and are mainly used with mass-market wines and wines at the low end of the price scale (retailing for less than $7 a bottle). PVC capsules are made using two pieces (skirt and top disk) and have a seam, similar to polylaminate capsules. PVC capsules are made of plastic and are heat-shrunk onto the neck of the bottle (PVC capsules can be easily used with bottles of different diameters). Some PVC capsules are perforated or come with a tear tape for easy removal, and can be very customized in their design via printing, hot-foil stamping and custom embossing. wbm
Capsule and Wax Suppliers
Companies Location Phone Web Address
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Alcan Packaging Capsules American Canyon, CA 707-257-6481 www.stelvin.alcan.com
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Alcoa CSI Chicago, IL 773-380-7717 www.alcoacsi.com
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AO Wilson Ltd. Bolton, ON, Canada 905-857-1511 www.aowilson.ca
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Battistella USA American Canyon, CA 707-643-4455 www.battistellacapsule.com
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C&E Closures Napa, CA 707-603-2500 www.ceclosures.com
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California Glass Oakland, CA 510-635-7700 www.calglass-pcc.com
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Canals Packaging Healdsburg, CA 707-433-4398 www.canalspackaging.com
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ColloPack Solutions LLC Napa, CA 707-258-3940 www.collopack.com
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Collotype Labels International Napa Valley, CA 707-603-2500 www.collotype.com
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Cork Supply USA Benicia, CA 800-961-2000 www.corksupplyusa.com
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Cortica Benicia, USA Benicia, CA 800-532-2207 www.cbcork.com
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Diablo Valley Packaging Fairfield, CA 707-422-4300 www.dvpackaging.com
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Enocapsule Vaudreuil, QC, Canada 450-424-2131 www.enocapsule.com
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Encore Glass, Inc. Richmond, CA 510-234-5670 www.encoreglass.com
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G-3 Enterprises Modesto, CA 209-341-7770 www.g-3enterprises.com
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Global Package, LLC Napa, CA 707-224-5670 www.globalpackage.net
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GW Kent, Inc. Ann Arbor 734-572-1300 www.gwkent.com
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Janson Capsules Napa, CA 707-864-8627 www.jansoncapsules.com
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Lafitte Cork & Capsule Inc. Napa, CA 707-258-2675 www.lafitte-usa.com
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Maverick Enterprises Inc. Ukiah, CA 707-463-5591 www.maverickcaps.com
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North American Packaging Kirkland, WA 866-488-6117 www.napproducts.com
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OENEO Closures USA Napa, CA 707-256-2830 www.oeneoclosuresusa.com
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Phoenix Packaging Montreal, QC, Canada 800-661-6481 www.phoenixpackaging.com
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Pickering Winery Supply San Francisco, CA 415-474-1588 www.winerystuff.com
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Ramondin USA Napa, CA 707-944-2277 www.ramondin.com
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Rivercap Benicia, CA 707-747-3630 www.rivercap.com
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Saxco Pacific Coast Vancouver, WA 360-892-3451 www.calglass-pcc.com
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Scott Laboratories, Ltd., Inc. Petaluma, CA 707-765-6666 www.scottlabsltd.com
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Sparflex California Napa, CA 707-255-6718 www.sparflex.com
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Vinocor USA Napa, CA 707-259-1529 www.vinocor.com
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Waterloo Container Company Waterloo, NY 315-539-3922 www.waterloocontainer.com
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Wax
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Blended Waxes, Inc. Oshkosh, WI 800-294-4692 www.blendedwaxes.com
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Calwax Corporation Irwindale, CA 800-722-5929 www.calwax.com
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Etched Images Napa, CA 707-252-5450 www.etchedimages.com
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Wine Cap Co. Sonoma, CA 707-939-3930 www.winecap.com
Cathy Fisher is a freelance writer living in Sonoma.
