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‘Moderate recovery’ predicted for global alcohol market in 2025

In 2023 in the dominant US market, IWSR recorded the first decline in almost 30 years of -2%. Meanwhile, global total beverage alcohol (TBA) declined -1% by volume and rose +2% by value in 2023. Excluding national spirits such as baijiu and shochu, global volumes were down -1% and value increased by +3%. 

For 2024, IWSR noted that: ‘While some more positive signs are starting to emerge in 2024, the global TBA market remains subdued after several years of above-trend growth, with challenges expected to continue until 2025 as household spending rebalances after strong inflationary pressures of the past two years’.

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IWSR prediceted that TBA was only expected to grow by +0.4% across 2024.

Recovery when it does take hold is expected to be weak, with volume and value rising by a CAGR (Compound annual growth rate) of +1% between 2023 and 2028, ‘with the main value growth coming from India, China and the US’.

These three markets are predicted to add US$30bn in sales value over the same period, with India and China, followed by Brazil and Mexico, adding the most value to the sector.

Of the markets that did show growth in 2023, India led the pack, with all major categories except wine and rum showing growth, with Scotch and US whiskies up +7%.

China, however, with a slowing economy, presented a more mixed picture, with international spirits growing by +2% as the on-trade sprang back to life, but with Cognac down -3% and Scotch falling by -11%.

“The ongoing shift in the TBA growth axis, with gains now coming increasingly from developing markets, entails a greater exposure to business risk. Companies need to reorientate their global strategies to target new growth opportunities,” said Emily Neill, COO research and operations, IWSR.

“Expansion across categories as well as geographic footprint will be increasingly important. In today’s global TBA marketplace, companies need to continue to innovate in order to succeed.”

Key points from the IWSRs analysis also showed:

Premiumisation

• Premiumisation decelerated further, with volume declines in the core premium price band for both spirits (-3%) and wine (-3%), although super-premium-and-above price tiers showed more resilience (0% and -2% respectively).

Spirits

• The premiumisation universe for spirits is narrowing: while agave was the key driver of premium-and-above growth across a broad range of geographies in 2023, the gin boom has ended even more quickly than was anticipated, with marked declines from pandemic highs in key markets such as the UK (2022-23 volumes -14%) and Spain (-11%).
• The US continues to dominate the global agave spirits market – posting growth of +4% (volume) and +7% (value) in 2023 – with solid growth in premium-plus price tiers. It will account for the vast majority of future value growth for the category, which is forecast to expand globally at a CAGR of +6% between 2023 and 2028.

Wine

• The structural decline of the global wine market continued in 2023, with volumes down -4% versus 2022. Volume declines are expected to persist to 2028 – at a CAGR of -1% – with value growth flat.
• The general gloom enveloping the category is lifted by the strong appeal of premium rosé in key markets such as the US, the UK and Australia. Rosé’s popularity is being fuelled by a number of factors, including its consistency and drinkability; a fun and upbeat image associated with social occasions such as bottomless brunches and outdoor summer entertaining; and a plethora of aspirational, recognisable and elegant brands.

RTD and No-alcohol

• In 2023, RTDs were the star of the global beverage alcohol market – the only major category to record volume growth (+2%), alongside a strong +6% uptick in value. This growth is expected to continue, with both volume and value forecast to grow at a CAGR of +3% between 2023 and 2028.
• All no-alcohol categories recorded impressive gains in 2023: global no-alcohol beer volumes were up +6%, still/sparkling wine grew by +7%, and no-alcohol spirits continued their recent double-digit growth with a +15% volume surge. In value terms, growth was higher still.
  
  
  
  

• wine
• US
• Cognac
• China
• Spirits
• India
• decline
• IWSR
• recovery
• global beverage alcohol sales
• TBA
• markets Whisky