Asia spirits sales to surge in next five years

Despite recent challenges posed by the slowdown in China, Asia is expected to see the largest volume increase of any region across spirits, wine and beer over the next five years.

A new forecast report by the IWSR states that Asia is still a “key growth” for the long-term growth of the spirits industry

According to a new forecast report by the International Wine and Spirit Research (IWSR) Asia will remain a “key region” for the long-term development of the global alcohol market, with total yearly consumption set to surge by almost 1.2 billion nine-litre cases by 2019.

India and China are forecast to be the largest-growing spirits markets between 2013 and 2019, together accounting for a rise of 120.5m cases in yearly spirits consumption.

Local spirits such as baijiu, local whisky and brandy will drive volume growth across Asia, however the IWSR notes that many markets are showing a “wealth of opportunity” for imported drinks.

While local brands are anticipated to with a steady compound annual growth rate (CAGR) of 1%, imported spirits are set to grow with a CAGR of 3.8% between 2013 and 2019, an increase of 8.7m cases.

In contrast, volumes sales in Europe are expected to decline by 27.2m cases from 2014 to 2019 due to a steady contraction in the wine and beer categories. The US is the only non-Asian market to appear among the IWSR’s top five largest growth markets for spirits in this period.

Since late 2012, international drinks groups have struggled against a market slowdown in China and other emerging Asian markets. While China continues its austerity drive, other markets across the continent have experienced difficult trading environments.

Last month, Pernod Ricard revealed that its sales slump in China had finally started to improve as shipments to the country increased by 4%. However fellow French drinks groups LVMH and Rémy Cointreau have continued to suffer sales setbacks due to destocking in the region.