Gas shortages drive glass bottle price increases in India
Key takeaways
- Brewers in India warn of price increases for glass bottles, aluminum cans, and paper cartons due to the Middle East conflict.
- Gas shortages and shipping delays impact imports, causing a 20% surge in glass bottle prices.
- Plastic packaging has also been impacted, with rising oil prices increasing costs of virgin polyolefins and triggering shortages.
Brewers in India have warned of glass bottle and aluminum can price increases due to the ongoing conflict in the Middle East, as disruptions to the supply of natural gas and shipping delay imports.
The Brewers Association of India, which represents Heineken, Anheuser-Busch, and Carlsberg, says that glass bottle prices have surged around 20%. Moreover, paper carton rates have doubled, as well as other packaging materials such as labels and tape.
Vinod Giri, director general at the Brewers Association of India, says: “We are asking for price increases in the range of 12–15%. We have advised our member companies to individually approach states.”
Gas is central to the glass bottle-making process, keeping furnaces and production lines running. India imports about 40% of its fuel from Qatar, according to Reuters. Current attacks on the energy sector in the Middle East are impacting the flow of gas from Qatar to India.
Nitin Agarwal, CEO at the India-based Fine Art Glass Works, says the company has cut production by 40% at his glass bottle-making factory due to gas shortages.
Meanwhile, the continued blockade of the Strait of Hormuz is also delaying aluminum imports, needed for can makers.
The full impact on the glass and manufacturing industries in India and globally is still developing. Commenting on the situation, Carlsberg tells Packaging Insights: “It is too early for us to offer a macro comment.”
Plastic supply disruptions
Glass and can manufacturers in India are not the only packaging sector affected by the ongoing Middle East conflict.
Packaging Insights spoke to Marcel Alberts, founder at Healix, a Netherlands-based clean-tech recycling start-up, to explore how rising oil prices impact Europe’s packaging supply chains.
Alberts noted that the soaring prices are “significantly” increasing the cost of virgin polyolefins derived from fossil feedstocks such as naphtha, ethylene, and propylene.
Meanwhile, the conflict has also triggered a shortage of naphtha feedstock in South Korea, impacting the stability of the nation’s plastic packaging industry.
