The new year has delivered a bitter financial pill for Mumbai's bustling food service industry. State-owned oil marketing companies (OMCs) have sharply increased the price of commercial liquefied petroleum gas (LPG), triggering immediate concerns over rising food costs for the city's residents.
Details of the Price Increase
Effective from January 1, the cost of a standard 19-kilogram commercial LPG cylinder in Mumbai has surged by Rs 111. The revised price now stands at Rs 1,642.5, up from the previous rate of Rs 1,531.5. This adjustment is part of the OMCs' routine monthly price revision, which is linked to international fuel benchmarks.
This hike specifically impacts businesses that rely on commercial-grade gas, including:
- Restaurants
- Hotels
- Bakeries
- Catering units
It is important to note that domestic LPG prices for households remain unchanged. A 14.2 kg cylinder continues to cost Rs 853, a rate stable since a Rs 50 increase in April 2025.
Industry Reaction and Mounting Pressure
The January hike is particularly painful as it follows two consecutive months of minor relief. Prices were reduced by Rs 15.5 on December 1 and by Rs 5 earlier. With this latest increase, commercial LPG rates have now climbed to their highest point since June of last year.
Industry leaders have voiced strong apprehensions. Pradeep Shetty, spokesperson for the Hotel and Restaurant Association (Western India) or HRAWI, called the development "unexpected." He highlighted the severe impact on small and medium-sized eateries, which are the backbone of Mumbai's food culture.
"A small restaurant typically requires around two to three cylinders per day. The recent hike places significant financial pressure on the business and could result in revision of price of products," Shetty explained, emphasizing how operating expenses will rise and already thin profit margins will shrink further.
Consumers to Bear the Ultimate Cost
Vijay Shetty, President of AHAR (Association of Hotels and Restaurants), echoed these concerns, stating the increase will severely raise input costs for establishments of all sizes. He painted a grim picture of the cumulative burden on the industry.
"With other input costs of the restaurants already on a high, this increase in gas cylinder rates is another nail in the coffin for restaurants. This leaves them no option but to revise their menu rates, which directly impacts the common man's pockets and reduces footfalls," he warned.
The fear within the sector is that repeated increases in commercial fuel costs will dampen the dining-out sentiment across Mumbai. This effect is expected to be most acutely felt at local neighbourhood eateries and budget-friendly restaurants, which operate on very tight margins and cater to a price-sensitive clientele.
While households are shielded for now, the direct correlation between business operational costs and consumer prices means Mumbaikars should prepare for potentially higher bills when eating out in the coming weeks.
