Scotch fortunes tied closely to India and global travel retail revival, says IWSR

By Luke Barras-hill |

Global beverage alcohol is forecast to grow by 2.9% in volume terms (per 000’s nine-litre cases) by the end of the year, according to the latest insights from IWSR Drinks Market Analysis.

The strength and resilience of key markets coupled with brand owners’ swift response to changing market conditions is predicted to yield a CAGR of +1.5% in alcohol consumption from 2021-2025.

On a category level, the majority of growth in Scotch whisky – notably in the premium segment – is expected to be driven by the recovery in global travel retail, plus the key India market.

Total beverage alcohol consumption is forecast to return to pre-Covid levels by 2023 and steadily increase through to 2025. Source: IWSR Drinks Market Analysis. Click to enlarge.

Total beverage alcohol declined by 6.2% worldwide in 2020, hammered by the near-complete shutdown of bars and restaurants.

However, the result was an improvement on the previous forecast decline of -8% made in November based on alcohol beverage consumption in 19 key markets and global travel retail.

Much of this was down to strong e-commerce sales (+45% to reach $2.9 billion), growth in the read-to-drink (RTD) vertical, a rise in at-home consumption and sturdy performances in the US and China.

Convenience, refreshment and different flavours are driving consumer appeal within the RTD segment, which is projected to grow by almost 27% in volume terms this year. Source: IWSR Drinks Market Analysis. Click to enlarge.

Premiumisation is set to continue apace, continued IWSR Drinks Market Analysis, buoying the recovery in alcohol beverage consumption.

The firm estimates that total volumes for premium-and-above wines and spirits will lift by 25.6% in 2020-2025 (versus +0.8% volume growth over the same period for brands in low price tiers).

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