Lotte Chilsung Beverage announced it will raise the prices of its major beverage products starting June 26.
The company stated on June 23 that it will increase the ex-factory prices of 44 items across 12 brands, including Chilsung Cider, Pepsi Cola, Milkis, Cantata, and Hot Six, by an average of 5.3%. This marks the first price adjustment in nearly two years since June 2024.
The price increases will be 4.3% for Chilsung Cider, 6.0% for Milkis, 5.7% for Cantata, and 4.0% for Hot Six. Pepsi Cola will see an increase of about 5.0%, Mountain Dew will rise by 6.1%, and Gatorade will go up by 6.3%.
This price adjustment is attributed to soaring costs of packaging materials and raw materials. According to Lotte Chilsung Beverage, packaging costs, including aluminum cans and plastic containers, account for about half of the total raw material costs.
The price of aluminum, based on the London Metal Exchange (LME), has surged nearly 50% from $2,440 per ton in May of last year to around $3,670 per ton in May of this year. The price of naphtha, a key raw material for plastics, has also risen approximately 68%, from $568.6 per ton in May of last year to $957.7 per ton this May, according to the Ministry of Trade, Industry and Energy's raw material price information.
Additionally, the rising exchange rate of the won against the dollar has increased the cost of importing concentrate and added logistics expenses, further contributing to the cost increase. Products like Pepsi Cola, Mountain Dew, and Gatorade are produced using concentrates imported from the U.S. PepsiCo, making them particularly sensitive to exchange rate fluctuations.
Lotte Chilsung Beverage has stated that the cumulative burden of costs has made price adjustments unavoidable. Earlier this year, the company implemented a pricing linkage system for small and medium-sized suppliers and raised transportation costs to support its partners.
A company representative remarked, "We have absorbed the factors for price increases through company-wide cost-cutting activities, but the cost burden has reached its limit. This is an unavoidable measure to maintain quality and ensure stable product supply."
* This article has been translated by AI.
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