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ATLANTA (

TheStreet

) --

Coca-Cola

(KO) - Get Coca-Cola Company Report

raised consumer prices in the recent quarter, and has plans for more price hikes later this year, as costs for packaging, sweeteners and other ingredients continued to rise.

Coke's cost of goods sold (COGS) jumped 68.6% to $4.99 billion, or a 39.2% share of total operating revenue. In the year-earlier period, COGS were $2.96 billion, or a 34.2% share of net revenue, and in the first quarter the line item came to $3.95 billion, or a 37.5% share of total revenue.

>> Coca-Cola's Profit Canned by Aluminum?

Coke said it raised prices in North America by 1% to 2% in the second quarter to help offset rising costs, which may help explain why

adjusted sales volume was flat in the region last quarter

. The company also intends to hike consumer prices another 3% to 4% in the second half of the year.

"Pricing should be led by the consumer, but the trouble is the consumer, particularly at the low end, is driven by unemployment, which is back up," Morningstar analyst Philip Gorham told

Reuters

. "I just don't think the environment is right to raise prices."

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Both Coke and

PepsiCo

(PEP) - Get PepsiCo, Inc. Report

, which is due to report its quarterly results later this week, have been battling more than each other for beverage dominance.

Coke, the maker of Diet Coke, Sprite and Vitamin Water drinks, among many beverages, has been battling rising commodity costs, as have most companies in the food and beverage business.

Recently,

Coke "rung the bell on a heavyweight battle against Goldman Sachs

"

(GS) - Get Goldman Sachs Group, Inc. (GS) Report

in a battle over its aluminum costs, noted

TheStreet

senior contributor Daniel Dicker.

"Coke has seen aluminum prices explode more than 13% since the start of the year, even though supplies have been running at deep surpluses inside the London Metals Exchange's network of storage warehouses," Dicker said.

>>For upcoming earnings and estimates, see our

Earnings Calendar

.

The storage warehouse where Coke gets most of its aluminum is privately held by

Metro International Trade Services

, which is owned entirely by Goldman Sachs.

Pepsi, which boasts a wide roster of brands including Frito Lay, Tropicana and Quaker, is expected to increase second-quarter earnings by 20.6% to $1.93 billion, or $1.21 a share. Analysts expect revenue to increase by 10.9% to $16.41 billion from $14.8 billion.

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As of earlier this year,

Pepsi had been able to better manage the risk of rising commodity costs than Coke

, and market watchers will pay close attention to the food and beverage maker's report this week to see if it has been able to maintain that trend. In its first quarter, Pepsi's COGS soared 22% to $5.45 billion, though the figure took up a smaller percentage of total revenue year over year. Pepsi turned to improved operational efficiencies and price increases to help offset those costs, but Chief Financial Officer Hugh Johnston conceded in April that pricing in the first half of the year "has not been what we would have liked or expected."

Costs for plastic bottles and fuel to transport beverages has risen as oil prices heated up this year. Oil prices affect the price of polyethylene terephthalate, or PET, the plastic used by beverage companies to make soda bottles. Coke, Pepsi,

Dr Pepper Snapple

(DPS)

and other beverage makers cannot hedge the prices they pay for PET because the material is not traded like other commodities.

Both Pepsi and Coca-Cola recently purchased their largest bottlers, hoping to streamline production and distribution costs. Coca-Cola bought out

Coca-Cola Enterprises

(CCE)

in October of last year in a $3.4 billion acquisition. Earlier, PepsiCo acquired two of its bottlers.

That means the pair is even more acutely affected by bottling costs than they had been before integrating the bottlers' cost of operations into their own.

>> Don't Buy Dunkin' Donuts IPO: Value Analyst

Even so, Coke said Tuesday the integration of its bottler was on schedule, resulting in expected cost savings of $140 million to $150 million in 2011. It added that productivity initiatives it had undertaken were likely to exceed expectations, expected to generate further annual savings of $400 million to $500 million.

Shares of Coke jumped 3.4% to $69.38 at midday Tuesday on high volume. Around 9.1 million shares changed hands less than halfway through the day's session, compared with their average daily volume of just 7.7 million. Pepsi was 0.5% higher at $68.34. Pepsi's report is due out on Thursday.

--

Written by Miriam Marcus Reimer in New York.

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Miriam Reimer

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