July 24 (Bloomberg) -- Coca-Cola Co., the world's biggest sodamaker, reduced the size of canned drinks by 7 percent in Hong Kong to rein in rising production costs driven by high raw material prices.

``The main driver is aluminum,'' Kenth Kaerhoeg, communications director for Coca-Cola Asia Pacific, said today in a phone interview in Hong Kong. Two supermarket chains in Hong Kong said they didn't cut the price of the drinks.

Coca-Cola, Toyota Motor Corp. and other companies are struggling with rising metals and fuel costs because of a global shortfall of materials. Aluminum prices have jumped 25 percent this year as power shortages in China and South Africa led to production cuts.

``Every single company in the food and beverage industry has been doing things to their packaging since last year because the price of raw materials has risen so much,'' Fiona Wong, a consumer analyst at Sun Hung Kai Securities Ltd., said in Hong Kong. ``They are trying to standardize packaging to keep costs low. They will switch to a cheaper material if they can.''

The drink cans were cut to 330 ml from 355 ml, and include Coca-Cola, Coke Light, Coke Zero, Coke with lemon flavor, Fanta, Sprite, Sprite Zero and Schweppes Cream Soda, Kaerhoeg said.

The change was previously reported by Apple Daily newspaper today.

Common Cans

The new can is also the most commonly-used size in the world, and the move would align products with those sold in Europe, Kaerhoeg said. He didn't specify savings or say if sizes in the rest of Asia could be cut.

Prices for the drinks haven't been cut by suppliers, said Annie Sin, marketing communications manager of Wellcome supermarket, a unit of Dairy Farm International Holdings Ltd. Wellcome has kept its prices unchanged, she said.

ParknShop, part of Hutchison Whampoa Ltd., has no plans to reduce prices, Pinky Chan, a spokeswoman, said over the phone.

The new canned drinks started selling in early July, Coca- Cola's Kaerhoeg said.

Some food and beverage companies are changing from plastics containers to carton and some are using thinner cans or plastic bottles, which could cut costs by 10 to 15 percent, Sung Hung Kai's Wong said.

Aluminum Surcharges

Rio Tinto Group, the world's second-largest aluminum producer, this week said it may add surcharges to some products to recoup soaring energy and transport costs.

Coca-Cola Co. this month reported that second-quarter profit fell 23 percent on a $5.3 billion writedown at its biggest bottler, Coca-Cola Enterprises Inc. The company posted a 13 percent increase in sales volume in Hong Kong, China, Taiwan and Macau in the second quarter, Kaerhoeg said.

Coca-Cola doesn't plan to reduce the size of its plastic bottled drinks, Kaerhoeg said. Ethylene is the raw material to make plastic derivatives, and it's commonly made from processing naphtha, an oil product.

Crude oil has risen 29 percent this year and hit a record of $147.27 a barrel on July 11.

To contact the reporter on this story: Stephanie Wong in Hong Kong at swong139@bloomberg.net

Last Updated: July 24, 2008 05:00 EDT