CHICAGO - Consumers continue to down bottled water, despite a recent price hike triggered by commodity inflation, Reuters reports. A top executive with Nestle Waters North America said higher bottled water prices are here to stay.

"They're not going to come back down. This industry has been operating at substandard margins for the last five years due to all the competitive desire to gain market share," said Kim Jeffery, president and CEO of Nestle Waters North America, during the Reuters Food and Agriculture Summit this week.

During the past 10 years, bottled water prices have dropped 35% because of stiff competition, but Nestle Waters jacked its price on regional water brands and Nestle Pure Life by around 10%.

"We led the category in that and we suffered for a little bit at the hands of some people who took advantage of that for a few months," said Jeffery. "We went from positive to negative for a few months." 2011 ended with revenue advancing around 4%, he said, with 2012 showing good sales.

With U.S. carbonated soda consumption dropping to 44 gallons per person per year from 54 gallons, bottled water consumption soared from 16 gallons to 24 gallons. "Our category has captured 80% of their loss," said Jeffery. "The trends favor continued growth for bottled water. I don't think the decline for carbonated soft drinks is going to stop."

Jeffery also sees growth opportunities in tea. Nestle Waters North America owns Sweet Leaf and Tradewinds brands, and will begin offering Nestea in 2013. "I think there's still another place to occupy in the category. I think there's an opportunity to do more," he said.