Beer hike looms for beer in telangana

Prices to soar

■   The last revision was done in May 2023

■   The revision was due in January 2025, but it has already been delayed beyond the scheduled timeline

■   Industry estimates say companies earn only around Rs. 330 profit per beer case

■  Companies are also pushing for a 10 to 15 per cent hike in beer prices Summer has further boosted demand. Rising temperatures, heat waves, and humidity are pushing consumers toward beer consumption. Beer sales in March increased by 21 per cent compared to last year

metro india news I hyderabad

Thanks to the ongoing Gulf conflict, like several sectors, the beer manufacturing industry too is expected to feel the pinch. According to sources, beer prices in Telangana are expected to rise soon. Beer manufacturing companies are exerting pressure on the state government to revise prices, citing rising raw material costs.

The increase is being linked to global disruptions, including the Gulf conflict impact and the Iran war situation, which has affected natural gas supply worldwide. Along with this, the state’s excise duty burden is also adding financial pressure on companies.

Companies are also facing supply challenges as demand for beer continues to rise sharply, but production and supply are not matching the requirement. Excise department officials warn that a beer shortage in May cannot be ruled out if the situation continues.

Reports also suggest that companies are not willing to supply at old prices and are waiting for revised rates from the government before continuing regular distribution. Normally, liquor prices in the state are revised once every two years. The last revision was done in May 2023. The next revision was due in January 2025, but it has already been delayed beyond the scheduled timeline.

Industry estimates say companies earn only around Rs. 330 profit per beer case, while the government collects nearly Rs. 1,400 as excise duty per case. This imbalance has led companies to demand price revisions.

They are also pushing for a 10 to 15 per cent hike in beer prices, especially for premium varieties. At the same time, allegations are surfacing that some companies are encouraging black market activity, as several popular brands are not available in the open market, while others are being sold at inflated prices.

Across Telangana, there are 2,642 liquor shops, 1,127 bars, along with pubs and clubs operating under the excise system.

Summer has further boosted demand. Rising temperatures, heat waves, and humidity are pushing consumers toward beer consumption. According to Telangana Beverages Corporation Limited data, beer sales in March increased by 21 per cent compared to last year. In March last year, 46.40 lakh cases were sold, while this March it rose to 50.78 lakh cases, the highest in five years. Even before April ended, nearly 46 lakh cases were sold in just 15 days, with daily sales ranging between 1.70 lakh and 1.80 lakh cases.

The demand surge began earlier this year itself. In January, sales rose from 31 lakh cases last year to 34 lakh cases this year. In February, sales jumped significantly from 28 lakh cases to 38 lakh cases.

Meanwhile, a new concern has emerged over water availability. Beer manufacturers depend heavily on Manjeera river water, but falling water levels are creating production challenges. If production slows, supply may not match demand, increasing the risk of shortage.

To avoid disruptions, the excise department has planned measures to ensure continuous supply from depots to retail outlets. Authorities are also working to increase production by 10 to 12 percent compared to previous levels to meet rising summer demand.