Brewers worldwide are facing substantial cost increases due to surging fuel prices, with natural gas and diesel being primary drivers. In India, brewers anticipate a 12-15% price increase, largely due to a 20% surge in glass bottle prices and doubled paper carton rates, exacerbated by natural gas shortages linked to the Iran war. This crisis has forced some glass bottle manufacturers, like Fine Art Glass Works, to cut production by 40% and raise prices by 17-18%. Aluminium can suppliers also warn of reductions, impacting a market valued at $7.8 billion in 2024, expected to double by 2030.
Beyond India, the issue is global. Nigerian breweries, including Nigerian Breweries Plc, Guinness Nigeria Plc, and International Breweries Plc, reported a combined N112.87 billion in tax expenses in the first half of 2026, up 58% from 2025. This, coupled with soaring electricity, gas, and diesel costs, is pressuring them to pass costs to consumers. Similarly, in India, United Breweries (UBL) CEO Vivek Gupta stated the industry is in "major trouble" due to war-triggered input cost increases, estimating a 15% rise in production costs across bottles, raw materials, and exports. He is requesting a 15% increase in selling price to the government, not consumers, as taxes can account for a significant portion of the final price.
Diesel prices, specifically, are up approximately 75% year-over-year, with the cost exceeding $6 per gallon. This surge has doubled the overall operating costs for some businesses reliant on diesel for transportation, which were already 15% higher than the previous year. This directly impacts the brewing industry through increased shipping and distribution expenses. The Confederation of Indian Alcoholic Beverage Companies and the Brewers Association of India are actively seeking price adjustments from state governments to offset these rising freight, logistics, and input costs, with retail price adjustments typically requiring approval from two-thirds of India's 28 states.
