Will Hormuz Strait hit your booze? Beer prices to rise as India sees gas crunch | Here's how it's all linked
The Brewers Association of India has warned of rising beer prices as gas shortage has hit production, while supply disruptions have led to surging prices.
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The ongoing conflict between the US and Iran, which marks 30 days on Saturday, has not just led to oil shortage and energy crisis, but impacted the supply and resulting inflation for a wide range of products, ranging from plastic, cosmetics, to eatables and even alcoholic drinks.
India, despite being thousands of miles away from the battle zone, remains at the cusp of its impact. India imports 90 per cent of its crude oil, with half of the volume coming through the Strait of Hormuz, a narrow chokepoint that has emerged as the trope in the conflict.
Follow latest updates on US-Iran war
India imports a majority of its LPG from Gulf nations- mainly Qatar and Saudi Arabia, two countries hit hardest due to the conflict.
While the country has reported shortage of LPG, global brewers operating in India have now warned of supply disruption and price rise over the shortage of gas.
Why Iran war has led to rising beer costs
A shortage of gas means rising cost of beer bottles and shipping delays would mean a lack of raw materials, like Aluminium, required in manufacturing.
{{/usCountry}}A shortage of gas means rising cost of beer bottles and shipping delays would mean a lack of raw materials, like Aluminium, required in manufacturing.
{{/usCountry}}The Brewers Association of India, that includes firms like Heineken, Anheuser-Busch InBev and Carlsberg, said glass bottle prices have surged around 20 per cent, Reuters reported.
{{/usCountry}}The Brewers Association of India, that includes firms like Heineken, Anheuser-Busch InBev and Carlsberg, said glass bottle prices have surged around 20 per cent, Reuters reported.
{{/usCountry}}Gas remains an essential commodity required to keep the furnaces and production lines running. The attacks from Iran against Qatar's gas and oil facilities have partially disrupted export capacity, tightening gas availability.
{{/usCountry}}Gas remains an essential commodity required to keep the furnaces and production lines running. The attacks from Iran against Qatar's gas and oil facilities have partially disrupted export capacity, tightening gas availability.
{{/usCountry}}Also Read: 'We're comfortable with India': Ex-Trump admin official questions Pak's mediation in Iran-US truce
{{/usCountry}}Also Read: 'We're comfortable with India': Ex-Trump admin official questions Pak's mediation in Iran-US truce
{{/usCountry}}As a result, the shortages have forced several glass bottle makers to partially or fully halt operations.
{{/usCountry}}As a result, the shortages have forced several glass bottle makers to partially or fully halt operations.
{{/usCountry}}The hit on logistics has led to disruption in Aluminium supply, leading to possible reductions. Apart from the production, the packaging of the final product has also hit, with a surge in prices of paper carton and other packaging materials such as labels and tape.
What to expect on prices
Despite Trump's truce suggestions, there is no concrete timeline on a possible slowdown of the ongoing war. The shortage of gas and the disruption in supply chain comes as India is heading into its peak summer season, when beer sales typically goes up.
Also Read: Trump’s dramatic U‑turn on Strait of Hormuz: From ‘will open itself’ to acknowledging Iran’s control
"We are asking for price increases in the range of 12-15%. We have advised our member companies to individually approach states," Vinod Giri, director general of The Brewers Association of India told Reuters.
Giri said the rising cost of production is making "some operations unsustainable". There was no official word from Heineken's India unit United Breweries, Anheuser-Busch InBev or Carlsberg.
The liquor sales have grown steadily in India alongside rising urbanisation and an increasingly affluent population. According to Grand View Research estimates, the liquor market was worth $7.8 billion ( ₹73,800 crore) in 2024, and is expected to double by 2030.
