Water Price: The effects of the Iran-related conflict and the spike in crude oil prices could soon hit your wallet. There are indications that the price of bottled drinking water in India is on the rise (packaged water price increase India), as the packaged water sector faces escalating costs due to high oil prices.
Brent crude oil has once again exceeded $100 per barrel in the global market. This increase in oil prices is now affecting the plastics and packaging industries, putting pressure on India’s roughly $5 billion packaged water market. Companies are experiencing rapid cost increases, especially just before the summer season, which is when the demand for water peaks.
Why is bottled water becoming more expensive?
Industry organizations report that the war has disrupted supply chains and raised the costs of various packaging materials. The price of polymer, the primary raw material for producing plastic bottles, has surged by 50% to around ₹170 per kilogram. Additionally, the cost of bottle caps has more than doubled to Rs 0.45 each. Other packaging materials, including labels, cardboard boxes, and adhesive tape, have also seen price hikes. All of this is directly affecting production costs, making it particularly challenging for small manufacturers.
Small manufacturers raise prices
Faced with rising costs, nearly 2,000 small bottled water producers have raised prices for their distributors. Reports indicate that the price increase is about 5%, or roughly 1 rupee per bottle. Industry organizations warn that prices could rise further by as much as 10% in the near future. Currently, a 1-litre water bottle in India typically costs less than Rs 20, but the effects of rising costs may gradually be felt by consumers. Retail prices have not yet seen significant changes because larger brands like Bisleri, Kinley, Aquafina, and Reliance are absorbing the increased costs. However, smaller companies are struggling to keep up.
According to Apurva Doshi, General Secretary of All India Packaged Drinking Water Manufacturers Association, if the current situation continues, the impact on consumer prices may start becoming visible in the next 4-5 days. The natural mineral water market in India is worth around $400 million and is growing rapidly.
Companies say they have raised bottle prices by about 18% for their resellers. Many are still absorbing the additional 40-50% cost themselves to avoid losing customers. But if oil prices remain high like this, then it is almost certain that bottled water will become expensive during the peak summer season.