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LONDON (Reuters) – Coca-Cola (NYSE:KO) Europacific Partners told Reuters on Thursday it expects to hike prices further, and said glass costs would rise by the “mid-teen to low double digits” this year at a time when it is trying to sell more returnable glass bottles.
Glass shortages have persisted for beverage companies and other manufacturers since the pandemic, with the issue compounded by Russia’s invasion of Ukraine.
“It’s quite significant and part of it is also led by the shortages that we had given the unfortunate war breakout between Russia and Ukraine, as we had a lot supply there,” said Nik Jhangiani, finance chief of CCEP, which bottles and sells Coca-Cola products in Western Europe, Australia and New Zealand.
“So we had to look at alternative sources of supply as well, to ensure that we could continue having our products available on shelf,” he said.
The bottler has nonetheless been investing in its planned programmes to sell more products in glass bottles that can be returned to hotels and restaurants, amid concerns about waste. CCEP has rolled out returnable glass bottles in France, Spain and Belgium.
“You’re using those bottles ten-twelve-plus times, if not longer,” Jhangiani said.
He added the CCEP would raise prices for its products this year.
PepsiCo (NASDAQ:PEP) Inc said this month it would not raise prices of its sodas and snacks further after multiple rounds of price hikes last year helped the beverage giant post fourth-quarter profit and revenue that exceeded analysts’ estimates.
“We will take pricing in 2023 and we’ll work through in our markets the timing and the right levels of pricing,” CCEP’s Jhangiani said. “We didn’t take prices up at the same rate because it comes back to taking it in more manageable, bite sized chunks so to speak.”