Wine consumption up in Oz but overall alcohol down as young Australians opt for "abstinence"

By Jo Gilbert

Published: 15 June, 2016

New figures suggest that "abstinence" in young Australians is behind the recent nose-dive in alcohol consumption across the country - although wine consumption is on the up.

According to figures published last week, Australia has reached the lowest level of per capita consumption since the 1960s, but wine continues to gain traction in the market.

The Australian Bureau of Statistics (ABS) says that changes in patterns of alcohol consumption and a trend of abstinence among young drinkers has contributed to Australians drinking less alcohol.

For example, sales of beer have slumped drastically after accounting for three quarters of all alcohol consumed 50 years ago.

In terms of demographics, the most pronounced group leading this trend of abstinence are younger Australians, though they are often the first people think of when discussing risky drinking behaviour.

However, the report from Euromonitor showed that the premiumisation trend in alcoholic drinks continued in 2015, pushing up value sales.

Whilst total volume sales of alcoholic drinks registered a slight negative compound annual growth rate (CAGR) over the review period between (2010 to 2015), in terms of total value, the CAGR was higher at 3%.

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Growth in expenditure on alcoholic drinks was stronger, as consumers switched to more premium options.

These included products from the craft beer and craft spirits movements, with corresponding trading up occurring across alcoholic drinks categories, resulting in rising average unit prices.

The Australian gin craze gains also continued to gain momentum, with the number of Australian craft gin brands growing significantly between 2010 and 2015.

Previously, the key brand in craft gin was West Winds, from Margaret River in Western Australia.

However, there are now more than 50 craft gin distillers nationwide, including Four Pillars and Melbourne Gin Company in Victoria, and Archie Rose and Young Henrys in New South Wales.

Local distillers are challenging established brands in the market, such as Gordon's, Tanqueray and Bombay Sapphire, differentiating themselves through their stories, packaging and the use of native ingredients to produce distinctive products.

The total volume of alcoholic drinks are predicted to see only marginal growth over the 2015-2020 forecast period, although premiumisation and the rising popularity of upmarket brands provide optimism in terms of value growth for the industry.

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