India delays aluminium can rules to avert summer drinks shortages
India’s drinks industry has secured a government delay to new quality certification rules for aluminium cans amid fears of severe supply shortages. Producers have warned that limited domestic capacity and import bottlenecks could disrupt peak summer sales.
India’s drinks manufacturers have persuaded the national government to delay introducing new Bureau of Indian Standards certification benchmarks for aluminium cans to prevent supply shortages crippling their sales.
Industry bodies, such as the Brewers Association of India, had warned that supply shortages could lead to significant sales losses and impact operations during the peak summer months.
Brewers lobby to avoid repeat of 2024 disruption
The Brewers’ Association of India, whose members account for 85% of the country’s beer sales through members such as AB InBev, Carlsberg, and United Breweries, had been actively lobbying for a delay to prevent a recurrence of last year’s supply challenges.
In its latest annual report, UB highlighted can shortages as a material issue hitting sales.
Domestic production capacity stretched
At the root of the problem is the lack of domestic capacity to produce sufficient cans, as Indian manufacturers have reached their maximum output while demand for canned beers and soft drinks continues to grow.
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New certification of quality regulations on imports to ensure minimum health standards has created a bottleneck, meaning that the industry is facing shortages of up to 130m cans for the beer sector alone as drinks manufacturers enter their peak selling season.
That equates to about 20% of the total market for beer.
Import delays deepen supply squeeze
Certification of imported cans can take several months so some manufacturers had already doubled their import orders following last year’s loss of sales.
Strong growth in canned drinks demand
Demand for aluminium beverage cans in India is on a strong upward trajectory, driven by a preference among millennials for their convenience, aspirational appeal, and recyclability.
The market is projected to double from approximately US$400m last year to $800m by 2032. Yet new domestic manufacturing capacity has been unable to keep pace with demand growth as it takes up to a year to bring extra lines into production.
Phased rollout extended into 2027
As a result, Delhi has extended the phased implementation of the new quality controls on imports to October 1 for big companies and until next January and April 2027 for small and micro enterprises, respectively.
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