Maharashtra Packaged Drinking Water Prices May Rise Sharply Due to Crude Oil Price Spike

Packaged drinking water prices in Maharashtra may soon rise sharply, with bottled water manufacturers warning that escalating crude oil prices linked to global geopolitical tensions are driving up the cost of plastic raw materials used to make bottles.Industry sources told Mumbai Mirror that the ongoing conflict involving the US and Iran has sent shockwaves through the petroleum market, directly impacting the cost of plastic – the key raw material used to manufacture water bottles.“If tensions continue to escalate, the price of a 1-litre packaged drinking water bottle, currently sold at Rs 20, could rise to Rs 25, while a 500-ml bottle may increase from Rs 10 to Rs 12,” Vijaysinh Dubbal, president of the Maharashtra Bottled Water Manufacturers Association, told Mumbai Mirror.He said the industry is already struggling under soaring raw material costs.“Plastic pellets are petroleum by-products. Whenever crude oil prices rise, the cascading effect hits industries dependent on plastic. The bottled water industry is among the worst affected,” Dubbal said.He added that packaged drinking water prices had not been revised for nearly a decade despite mounting operational costs.“For years, manufacturers continued operating on wafer-thin margins, unlike retailers. But now, with raw material costs soaring due to the spike in crude oil prices, we are left with no option but to increase prices,” he said.The industry is also facing stiff competition from illegal and unlicensed bottling units that mushroom every summer to cash in on rising demand. Earlier inspections by the Food and Drug Administration (FDA) had revealed hundreds of illegal packaged water plants operating across Maharashtra without mandatory BIS and FSSAI licences.According to industry estimates, Maharashtra has more than 500 bottled water manufacturing units, particularly concentrated in the western part of the state. However, nearly 30 per cent of these units – mostly small-scale players – have either temporarily suspended operations or are struggling to survive amid the sudden spike in production costs. “Smaller manufacturers simply cannot absorb the shock. Nearly 30 per cent of the 500-plus plants have shut down after the steep rise in preform prices,” Dubbal said.Industry insiders said the cost of PET preforms – the small plastic moulds used to make bottles – has increased sharply in recent weeks, squeezing profit margins and disrupting supply chains.Manufacturers fear that if global tensions continue and crude oil prices remain volatile, consumers may soon witness another round of price revisions across the packaged drinking water sector.Despite the likely increase in bottle prices, Dubbal said retailers’ earnings would remain largely unaffected. “Retailers are extremely important for our business, and we have to protect their margins as well. Retailers earn margins of around 150 to 200 per cent while selling packaged water bottles,” he said.