Global spirits go flat in 2013, but not in travel retail

By Kevin Rozario |

Global spirits sales saw a dramatic slowdown in 2013, increasing by just +0.1% to 3.09bn nine-litre cases in 2013 versus 2012, whereas global travel retail spirits gained +1.4% to 21.6m cases over the year.

 

The latest data from research group IWSR (see right and click to enlarge) will be a worry for the spirits industry given that it saw a healthy +6.5% compound annual growth rate (CAGR) between 2007 and 2011.

 

The relatively strong volume growth in DF&TR was held back by a significant slowdown in Asia-Pacific but was offset by good numbers in Europe, the Americas and the rest of the world.

 

London-based IWSR says that the drag in 2013 overall was chiefly due to a big slowdown in the growth of local spirits in China and India.

 

Among the product categories, whisk(e)y was the best performer. It was the largest-growing, both globally and in each of the major regions, adding just under 8m cases in 2013 to 361m cases.

 

Vodka was second, growing by 2.3m cases globally in 2013 to 496.3m. Rum – a strong performer in past years – fared badly and fell by some -4.5m cases to 145.6m.

 

LARGE REGIONAL VARIATIONS

Asia-Pacific remained the largest region for spirits at 1.93bn cases, following a modest +0.1% rise in 2013 in line with the global average. Within the region, China – the biggest market – gained by only +0.8% to 1.18bn cases, while India did better +1.2% to 310.6m cases.

 

In both markets, spirits’ growth was significantly slower than the double-digit growth seen in previous years as the effect of slowing economies took hold.

 

The Americas was the largest-growing region, adding some 4m cases last year, a rise of about +1% to 445m cases. Europe lost more ground, posting the biggest decline to fall by -2.2m cases to 291m cases. Spain – still in the economic doldrums – lost over 900,000 cases of that, while Italy shed another 500,000 cases. The German market also contracted.

 

On a positive note in Europe, whisk(e)y saw its first year of growth since 2007. Whisk(e)y consumption in Poland grew by more than 500,000 cases, with a similar tendency in the CIS as the trend for switching from traditional white spirits to more trendy brown spirits continues to erode vodka’s share.

 

Whisk(e)y is the second largest-growing category behind gin, increasing by 225,000 cases. Germany, France and Turkey reported the next-largest increases in whisk(e)y consumption. Whisk(e)y was also the fastest-growing category in Africa and the Middle East.

 

Overall, consumption in the CIS was marginally up at 363.9m cases. In this traditionally vodka-consuming region, whisk(e)y grew by more than 500,000 cases, with the majority of the growth coming from Ukraine and Russia. Conversely, vodka saw the largest loss in the region due to government initiatives to reduce excessive consumption and increasing taxes, such as in Russia.

 

Beer grew globally by 85.6m cases thanks to consumption rising by more than 230m cases in Asia-Pacific, while Europe, the Americas and the CIS continued to decline. The main growth came from China.

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