Cognac fights downturn to post ‘high’ sales

Cognac sales in 2013 were “reassuringly high” despite a slowdown in the Chinese market, according to new figures released by the Bureau National Interprofessionnel du Cognac (BNIC).

While shipment volume of the spirit fell 4% to 13.4 million cases, sales value rose 0.2% to €2.4 billion.

Over recent months, some Cognac producers have announced a dip in their profits, largely attributed to the Chinese Government’s crackdown on luxury spending and gifting which has resulted in a decline in the Cognac and high-end Scotch market for the country.

Cognac exports to the Far East were found to have declined 10% by volume to 56 million bottles and 4% by value to €1.1 billion. Despite this, the BNIC described the region as the “the most important export market for Cognac in terms of volume and value”.

For Europe, volume shipments also dipped 5.3% to 43 million bottles – a total worth of €492 million

However, a worldwide trend of premiumisation and a boom in the US market meant that global Cognac sales were reported as “reassuringly high”.

North American shipments were up 2.1% to 53 million bottles, with value increasing 5.3% to €651 million, while Africa was described as a “key continent for growth”, with exports up by 26.7%.

In 2012, the global Cognac scene looked markedly different, with the BNIC reporting record figures for the spirit due to soaring demand in China.

Rémy Martin, however, has announced a 18.3% decline in organic sales for the first nine months of the year, warning that China’s “campaign to promote morality” will continue to adversely affect sales of ultra-premium spirits in the Chinese New Year.

For a more comprehensive view of the market and to see which brands are predicted to prosper in the year ahead, take a look at our Cognac and brandy brands to watch in 2014.