New Delhi, May 6, 2026: Confederation of Indian Alcoholic Beverage Companies has urged state governments to allow a “reasonable price revision” for IMFL and wine products, citing a sharp rise in input costs due to ongoing geopolitical tensions in the Middle East and the resulting supply chain disruptions.
Anant S. Iyer, Director General of CIABC, has formally written to state governments requesting immediate consideration for price revisions. He highlighted that the volatile geopolitical environment in the Middle East—accounting for nearly 20% of global crude oil supply and serving as a critical supply hub for India—has severely impacted cost structures across the alcoholic beverage industry.
According to CIABC, crude oil prices have surged to over $112 per barrel as of May 2026, nearly doubling from around $69 in February. The near disruption of the Strait of Hormuz has further intensified supply shortages and increased volatility in petroleum and petrochemical markets. At the same time, the depreciation of the Indian Rupee to around ₹95 per US dollar has significantly raised the landed cost of imported inputs.
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The association noted that inflationary pressures are being felt across packaging and raw materials. Prices of polypropylene (PP) and high-density polyethylene (HDPE) used in caps have increased by around 30%, while PET resin costs have risen by nearly 20% since February. Paperboard packaging has also become more expensive due to fibre shortages and a sharp increase in global freight rates.
Energy and industrial inputs have also seen steep cost escalations. Aluminium prices have risen, impacting ROPP caps, while coal prices have increased by over 20%, raising manufacturing costs. Glass manufacturers, particularly in key hubs like Firozabad, are facing restricted gas supplies and have increased prices by 10–20%. Additionally, commercial LPG prices have nearly doubled in recent months, further adding to operational expenses.
Global logistics challenges continue to exacerbate the situation, with rising ocean freight rates and additional conflict-related surcharges imposed on shipments linked to the Middle East and Indian subcontinent.
In view of these challenges, CIABC has recommended a revision in Ex-Distillery Prices (EDP) and Ex-Winery Prices (EWP) to help manufacturers absorb rising costs. The body emphasized that a calibrated price adjustment, along with corresponding excise revisions, would have a limited impact on consumer prices while ensuring industry sustainability.
CIABC further underlined that the Indian alcoholic beverage sector remains a key contributor to state revenues and economic growth. Enabling timely and pragmatic price revisions, it said, will support continued investments, stable operations, and the long-term health of the industry amid ongoing global uncertainties.
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