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Tamil Nadu Hotel Industry Grapples with LPG Shortage

A severe shortage of commercial LPG cylinders in Tamil Nadu has led to a significant shift in the hotel industry's cooking methods, resulting in increased food prices and disrupted business during the festive season.

The impact is particularly pronounced during Ramzan, a peak period for eateries. Hoteliers report that staple dishes remain available, but popular items like biryani have become costlier due to the rising price of firewood. Traditionally cooked over firewood for enhanced flavor, biryani is now being prepared using this method again, after years of reliance on LPG.

Industry estimates suggest that nearly 90% of hotels are operating without profits, with Chennai witnessing a 30% drop in business. Other parts of the state have reported a decline of around 10%. To manage costs and logistics, some restaurants have shifted to centralized kitchens, preparing dishes like biryani in bulk before distributing them to multiple outlets.

Read also: Treasury Yields Experience Largest Increase in Two Weeks Following Release of Labor Market Data

The crisis has also led to changes in menu availability and service timings. Items such as dosas are no longer served throughout the day, while foods that can be reheated, like chapatis and parottas, remain available. Residents say the situation has affected festive practices, with large Ramzan gatherings giving way to smaller family meals, often with reduced quantities of traditional dishes like biryani.

Industry leaders warn that food prices are likely to increase further, adding pressure on both businesses and consumers, as LPG supply remains constrained and the cost of alternative fuels continues to rise.

Investor Takeaway

The shortage of commercial LPG cylinders in Tamil Nadu may lead to increased food prices and disrupt business for hotels during the festive season.

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