If you have tried to order Diet Coke on Blinkit in Mumbai, Bengaluru, or Pune in the last few weeks, you have likely encountered the same message: unavailable. Shelves are bare. Platforms have capped purchases at four cans per customer. Social media is flooded with empty-cart screenshots and “found one… finally!” celebrations.
It is easy to read this as a quirky supply chain anecdote. A soft drink shortage. Something for the FMCG teams to sort out.
It is not. It is a precise and legible signal of a structural failure that belongs on every board’s risk agenda, and, more importantly, in every company’s decarbonisation strategy. Here is why.
One Strait. One Metal. One Thousand Downstream Consequences.
The proximate cause of the can shortage is well-documented: geopolitical tensions in West Asia disrupted shipping through the Strait of Hormuz, cutting off approximately 9% of global aluminium supply, destroying Gulf smelting capacity, and triggering a price spike of 14–20% in weeks. Simultaneously, India’s Bureau of Indian Standards (BIS) certification mandate for aluminium cans — introduced in April 2025 — had already compressed domestic supply. The two shocks arrived together, with summer demand rising sharply beneath them.
The result: can manufacturers across India could not source aluminium coil at any price that made operational sense. Coca-Cola began rationing. Pepsi pivoted to PET bottles. United Breweries scrambled. Diet Coke, sold exclusively in aluminium cans in India with no plastic fallback, simply disappeared.
But here is what the headlines missed: the liquid was never the problem. The factories were running. The drink exists. There were simply not enough cans to put it in.
This is a packaging supply chain failure. And packaging supply chains — in aluminium, in glass, in PET — are among the most carbon-intensive, geopolitically concentrated, and least decarbonised links in the industrial economy.
The Scope 3 Problem Most Boards Are Not Having
For most FMCG companies, the bulk of their GHG footprint does not sit in their own operations. It sits upstream, in the energy used to smelt the aluminium for their cans, mine the bauxite for that aluminium, refine the resin for their bottles, and freight the raw materials across oceans.
This is Scope 3: the emissions embedded in a company’s supply chain that appear on no internal carbon account but accumulate nonetheless in the atmosphere, and, increasingly, in regulatory exposure, investor scrutiny, and operational risk.
Primary aluminium smelted on coal power, which describes the majority of global production, including the dominant share from China, carries a carbon footprint of 15 to 20 tonnes of CO₂ per tonne of metal. A single aluminium beverage can weighs approximately 15 grams. Multiply across the billions of cans produced annually for India’s beverage market and the carbon arithmetic becomes sobering.
More critically: the same upstream dependency that created the can shortage is precisely where the majority of supply chain emissions are concentrated. The geopolitical chokepoint and the carbon liability are the same chokepoint. They are not separate risks managed by separate teams. They are one risk, and decarbonising the supply chain is the same action as de-risking it.
This is the insight that most boards are still treating as two conversations. It is one conversation.
The Loop Is the Strategy: Why Closed-Loop Recycling Is the Aluminium Supply Chain Boards Have Not Built
Aluminium is, from a materials science perspective, an extraordinary asset, but its recyclability comes with a critical condition that most boardrooms have never been briefed on. The aluminium atom itself does not degrade during melting. It is a chemical element, not a polymer. Unlike plastic, which breaks down after one or two cycles, or paper, which exhausts its fibre strength after five to seven, aluminium can in principle be melted and reformed indefinitely without loss of inherent properties — provided alloy purity is maintained throughout the recycling loop.
That condition is everything. In a closed-loop system, where the same alloy family is kept separate across its recycling cycles, aluminium is as close to a permanent material as industry possesses. Open-loop recycling, where mixed alloy scrap accumulates tramp elements across cycles until quality drift forces dilution with virgin metal. The material is not failing. The infrastructure governing it is.
Recycled aluminium, when handled correctly, requires only 5% of the energy needed to produce primary metal from ore. This represents a 95% reduction in energy intensity, with a carbon footprint of less than 1.5 tonnes of CO₂ per tonne, compared to 15 to 20 tonnes for coal smelted primary metal.
Put plainly: a closed-loop aluminium supply chain is not just the environmentally responsible choice. It is structurally immune to the disruptions such as events in the Strait of Hormuz. It is not exposed to Gulf smelter strikes. It does not move through geopolitical chokepoints. It operates locally, on scrap that already exists in the economy, at a fraction of the carbon cost. The constraint is not chemistry. It is the operational discipline and capital investment required to maintain a closed loop.
A notable paradox exists: approximately 25% of all aluminium ever produced is not in active circulation. It resides in landfills, mixed waste streams, and contaminated scrap pools for which recovery infrastructure has not been built. In India specifically, urban collection rates for used beverage cans remain below 40%. There is no national Extended Producer Responsibility (EPR) framework for aluminium packaging. There is no deposit return system. There is no closed-loop mandate. Consequently, the recycling supply chain consistently produces the two to three cycle degradation outcome that industry has accepted as normal, when it is, in fact, a governance failure masquerading as a material constraint.
The secondary supply chain that could have insulated India’s beverage industry from the Hormuz shock – local, low-carbon, supply-secure – does not yet exist at the scale required. That gap is not a regulatory gap alone. It is an investment gap and a strategic gap that corporations and boards have the agency to close.
Companies that act now to secure closed-loop supply chains will gain not only carbon advantage but also structural immunity to global commodity disruptions. Those that do not will remain exposed to the very risks that closed-loop recycling is uniquely capable of mitigating.
The Greenium Is Not a Cost. It Is Insurance with a Return.
There is a growing market for what commodity traders are calling the “Greenium”, a premium of $100 to $400 per tonne for aluminium produced using renewable energy, or with high certified recycled content. Apple pays it for the recycled aluminium in MacBook housings. BMW and Volvo pay it for EV battery trays. Novelis structures its entire beverage sheet business around it.
The Greenium is sometimes framed as an ESG overhead, the price of being responsible. This framing is strategically incorrect and financially misleading.
A company that sources green, recycled, or domestically circular aluminium is not paying a premium for conscience. It is paying a hedge against geopolitical supply disruption, against EU CBAM levies that will apply to carbon-intensive Indian aluminium exports from 2026, and against the growing cost of unpriced carbon in a regulatory environment moving irreversibly toward full-cost accounting.
The beverage company that locked in long-term green aluminium offtake agreements before the Hormuz disruption did not experience a shortage. The company that continued sourcing on spot markets from Gulf-dependent supply chains is rationing its most premium product during peak summer demand.
The Greenium, when viewed through the lens of supply security, is not a premium at all. It is the actuarially correct price of a supply chain that does not fail.
Three Waves of Demand Are Arriving. The Supply Chain Is Not Ready.
The aluminium can crisis is a preview, not an anomaly. Three structural demand waves are converging simultaneously on a global aluminium supply chain that is geographically concentrated, energy-vulnerable, and recycling-inefficient.
The EV transition will require 250 to 400 kg of aluminium per battery electric vehicle — compared to 160 to 180 kg in an internal combustion vehicle. Global EV production is projected to reach 40 to 45 million units annually by 2030, implying an additional demand of 5 to 7 million tonnes of aluminium per year from the automotive sector alone. A new world-scale smelter takes 5 to 7 years and $3 to 5 billion to build. The EV industry has already had its reckoning with lithium and cobalt. Aluminium is the supply constraint no one has yet priced into their strategic planning.
India’s infrastructure expansion — 50 million housing units under PMAY, metro rail to 50 cities, 500 GW of renewable energy capacity by 2030 — will nearly double the country’s construction sector aluminium demand by 2030. Construction specifications cannot be redesigned around alternative materials within project timelines. A shortage of extrusion profiles does not get solved by switching to steel. It gets solved by project delays, cost overruns, and the quiet destruction of economic value that economists call deadweight loss.
The electrical sector’s copper displacement is the third wave. With copper trading above $9,500 to $10,000 per tonne — nearly four times the price of primary aluminium — utilities, EV charging infrastructure developers, and grid operators are accelerating aluminium-for-copper substitution in cables, busbars, and transmission systems. India’s national grid expansion under PM Gati Shakti is already defaulting to aluminium wherever specifications permit.
Three waves. One supply chain. Geographically concentrated in China (58% of global primary production). Energy-vulnerable (coal-dependent). Recycling-inefficient (75% global recovery, under 65% in India). This is not a risk that diversified sourcing alone can manage. It is a risk that requires a fundamentally different supply chain architecture — one built on circularity, domestic recycling, and green production.
What the Board Needs to Decide
The Diet Coke shortage is a consumer-facing symptom. The boardroom question it surfaces is structural. For companies with material exposure to aluminium — whether in packaging, automotive, construction, electronics, or consumer durables — the strategic agenda should now include the following:
Map your Scope 3 aluminium exposure. Understand not just how much aluminium flows through your supply chain, but where it is smelted, with what energy, and through which geopolitical corridors. The carbon intensity and the supply risk are co-located. You cannot manage the risk without understanding the carbon.
Build a circular aluminium procurement strategy. Long-term offtake agreements with secondary smelters, investment in take-back and collection infrastructure, and recycled content mandates in product specifications are not sustainability postures — they are supply chain resilience strategies that reduce Scope 3 emissions and reduce price volatility simultaneously.
Prepare for CBAM. The EU Carbon Border Adjustment Mechanism is applying carbon levies to aluminium imports from 2026. Indian producers and their downstream customers exporting to European markets face a material compliance exposure unless their supply chains can demonstrate low-carbon production credentials. This is not a 2026 problem. The data collection, verification, and supply chain restructuring it requires must begin now.
Advocate for national recycling infrastructure. India does not have a deposit-return system for beverage cans, an EPR framework for aluminium packaging, or a strategic aluminium reserve. The policy gaps are real, but corporations are not passive stakeholders in this conversation. Industry advocacy for circular economy policy — Extended Producer Responsibility, recycled content mandates, export controls on unprocessed scrap — is a legitimate and effective lever that companies with supply chain exposure have every reason to pull.
Treat the Greenium as a budget line, not a discretionary overhead. Model the cost of green aluminium procurement against the cost of supply disruptions, CBAM levies, and Scope 3 carbon liabilities under emerging regulatory scenarios. In most models, the Greenium is the cheaper option.
The Empty Can Is a Full Argument
The missing Diet Coke is, in the end, a perfectly legible metaphor. The drink is there. The infrastructure to deliver it safely, sustainably, and securely is not.
This is the precise condition of most industrial supply chains today with respect to decarbonisation. The technology exists. The economics are increasingly favourable. The regulatory direction is unambiguous. What is missing is the strategic decision, at board level, in procurement policy, in capital allocation, to build the circular, low-carbon supply chain infrastructure that makes companies structurally resilient to the next Hormuz, the next BIS mandate, the next geopolitical shock to a commodity they depend on.
The can on the empty shelf is not a FMCG problem. It is a governance problem. And it has a solution, one that is simultaneously the right climate action, the right commercial strategy, and the right answer to the question every board should now be asking: what happens to our supply chain when the next shock arrives?
Snowkap works with companies to identify, measure, and reduce GHG emissions across Scope 1, 2, and 3, with a focus on supply chain decarbonisation, circular economy strategy, and CBAM readiness. For a supply chain carbon diagnostic, contact us at sales@snowkap.in
