‘Dramatic slowdown’ for spirits market in 2013

The growth of the global spirits market experienced a “dramatic” dip in 2013 due to a slowdown in consumption of local Indian and Chinese brands, according to new IWSR figures.

The global growth of spirits “dramatically” dropped in 2013 as the slowdown of local spirits in the Indian and Chinese markets continued to bite

Last year, international spirits sales increased by a marginal 0.1% to 3.09 billion nine-litre cases, which the International Wine and Spirits Research (IWSR) describes as a “dramatic slowdown” compared to the 6.5% compound annual growth seen between 2007 and 2011.

The research agency also found that whisky was the largest-growing spirits category in 2013, adding just fewer than eight million cases to reach a total of 361m cases.

Vodka was the second largest-growing spirits category, growing by 2.3m cases globally in 2013 to 496.3m. Meanwhile rum did not fare as well than in previous years, falling by 4.5m cases to 145.6m.

In terms of regions, Asia Pacific remained the largest market for spirits, selling 1.93m cases – a modest 0.1% rise on the previous year.

Furthermore, despite the slowdown in local Chinese spirits and a clampdown on extravagant spending by the country’s government, China was the largest individual market for spirits in this region, growing 0.8% to 1.18bn cases.

Meanwhile, spirits sales in India grew 1.2% to 310.6m cases. Both the Chinese and Indian markets were affected by slowing economies, causing the double-digit growth of the spirits market seen in previous years to decline.

The fastest growing region for spirits in 2013 was the Americas, where the US has proved a successful market for many producing looking to offset declines in Asia. In North America, Canada and Latin America, spirits sales grew 1% by four million cases to 445m cases.

In Europe, cash-strapped Spain lost over 900,000 cases, while Italy shed some 500,000 cases and the German market also contracted.

Also on the continent, whisky saw its first year of growth since 2007 as traditionally white spirits consuming countries of Eastern Europe switched from white spirits to “trendy” brown spirits.

Consumption was marginally up at 363.9m cases in the traditionally vodka-consuming Commonwealth of Independent States (CIS), with whisky growing by more than 500,000 cases. However, vodka saw a decline in the region, particularly in Russia, as governments attempt to reduce excessive consumption and impose a series of tax hikes.

Gin was the largest-growing spirits category in wider Europe, increasing by 225,000 cases, while whisky was the fastest-growing category in Africa and the Middle East.

Overall, growth seen in markets across Europe, the Americas and the rest of the world, was not enough to offset declines in Asia.