World’s largest brandy marketsBy Amy Hopkins
Brandy is continuing to shrug its dusty after-dinner image while at the same time maintaining a traditional following, but which are the spirit’s largest markets?
While older generation drinkers, from Germany to Brazil, remain loyal to brandy,the category is also shifting towards younger generation drinkers inspired by famous hip hop stars who plug their favourite tipple in chart-topping songs.
Yet as high-end expressions boost the value end of the category – despite recent declines in China – mainstream brandy brands account for the volume.
The Spirits Business recently reported the world’s largest Cognac markets, but this latest instalment looks at the wider brandy category (including Armagnac), and assesses its performance across the world.
Based on Euromonitor’s findings of how many litres of brandy were purchased across the globe in 2012, we count down five of the world’s largest brandy markets.
Despite recent figures suggesting that Brazilian consumers are rapidly turning away from traditional spirits cachaça and brandy in favour of the status symbol of international spirits, the country is still one of the largest brandy markets.
The IWSR states that brandy is failing to attract younger consumers and a narrowing price gap between bandy and imported spirits is making it easier to trade up. The report predicts that between 2013 and 2018, brandy and cachaça will lose almost 4.7 million cases between them.
However, with Brazil set to host the World Cup this year, local producers have predicted a momentary surge in Brazil-made spirits such as brandy, offering the potential to partly offset decline.
The Spirits Business reported last year that Germany was beginning to be viewed by producers as a key market for rectifying Europe’s flagging spirits volumes, and the story is no less true for its affect on brandy sales.
With sales of 65.4 million litres of brandy in 2012, Germany has been identified by Euromonitor as the spirit’s fourth largest market.
The popularity of the spirit stems from both the prevalence of Germany’s own brandy brands, such as Asbach, as well as Cognac – for which Germany is also the fourth largest market.
While Russia is by far the world’s largest market for vodka, the country’s growing penchant for international brands means that spirits such as brandy are experiencing a boom in popularity. Traditional, affordable brands also maintain a loyal following in the country – Armenia’s Ararat brandy is particularly popular in Russia.
With sales of 125.3 million litres in Russia during 2012, brandy cuts itself a considerable slice of the the country’s overall 1.7 billion spirits volumes sold in the year – since vodka alone accounts for 1.37 million.
However, brandy sales could experience significant decline in the years to come, as the country’s overall spirits volumes have been forecast to drop 13.2% between 2012 and 2017.
As one of the world’s largest markets for both rum and gin, the Philippines also provides an enthusiastic consumer-base for brandy.
According to Euromonitor, the Philippines consumed 287.9 million litres in 2012, while the IWSR has found that the country doubled its brandy consumption between 2008 and 2012.
The IWSR also found that in total, brandy consumption in the Asia-Pacifc region grew 45.6% in the time period. The country’s own Emperador brandy is particularly popular and growing sales across other international markets.
According to Euromonitor figures, India is the world’s largest market for brandy, purchasing 416.6 million litres in 2012. The brandy and Cognac sector is also set to set to overtake rum to become the second largest by volume in 2013.
Brandy brands owned by Indian companies are some of the largest in the world and continue to appeal to their home market.
According to our Brand Champions 2013, United Spirits-owned McDowell’s and Honey Bee, as well as Radico Khaitan-owned Old Admiral are among some of the biggest brandy labels in the world.