Australian fruit and vegetable manufacturer SPC Ardmona is negotiating with BHP Steel to try to get a cheaper price for the tin in its cans.
Managing director Nigel Garrard told shareholders and analysts that BHP had been supplying SPC's overseas competitors with tin plate at a substantially lower price than the Shepparton-based group had been paying."BHP, who have a monopoly on supply of tin plate in Australia, have been supplying tin plate to our overseas competitors, particularly in southern Europe, at prices substantially less on a delivered basis than they were supplying to us," Garrard said.
"I was not prepared for us to effectively underpin the profitability of our international competitors.
"We have had some meaningful discussions with BHP and I'm very confident of an outcome that will see us in a much more competitive position going forward."
Garrard later told journalists that SPC Ardmona paid A$50 million (€30m) per annum for its tin plate.
"If we can get just a one per cent reduction that's A$500,000," Garrard said.
"We have not been able to source tin plate, which is the raw material for the cans, at anything like competitive prices compared to our overseas competitors.
"I don't want a free kick, I just want an even playing field.
"We're having fruitful discussions and we should be in a position by the end of June in our talks with BHP."
SPC Ardmona booked a A$9.8 million net profit, before significant items, for the 2001 year compared to A$9.6 million for 2000, on Tuesday.Its overall net profit after significant items was $12.62 million, which included accounting adjustments from an April 2001 capital restructure. That compared to a $9.51 million profit previously.