Cognac and brandy brands to watch in 2019
2018 has been a fortuitous year for Cognac and brandy as both categories witnessed rising sales. We round up the brands set to take the spirits industry by storm over the next 12 months.
In 2018, a seven-year promise came to pass when the Cognac industry confirmed it would be raising its XO age classification from a minimum of six years to 10 this year. First announced in 2011, the rules, which came into force in April, are designed to “extend the quality positioning” of the category, and “align the regulation and market reality”.
Despite being hit by China’s measures to stamp out corruption, exports of older Cognac have rebounded, increasing by 12.4% from 1 August 2017 to 31 July 2018, according to the Bureau National Interprofessionnel du Cognac (BNIC). And the outlook seems prosperous for the wider category, too.
Perhaps now, finally, Cognac can put its superstitions to one side and say with confidence that the troubles of China’s austerity drive are in the category’s past, given global exports of Cognac rose for a fourth consecutive year from 20172018, according to BNIC figures. The statistics showed Cognac exports during this time increased 8.2% by volume and 5.4% by value, reaching 205.9 million bottles and generating turnover worth €3.2 billion (US$3.6bn).
“Cognac has gone through a resurgence over the past two years, driven by a global trend towards premiumisation and also new, younger and more affluent drinkers coming into the category,” says Megan Frank, vice president global marketing, Courvoisier.
But fresh challenges have hit the category hard this year, most notably the hailstorms in May that caused “very serious damage” to 3,500 hectares of vineyards in Cognac. Frank says: “For two consecutive years weather damage has had an impact on the production yield. ” She adds that just fewer than 1,000 farms were affected by the hail, adding to the frost of 2017 that wiped out 25% of that year’s harvest. “The result is that there is a global shortage, which is placing increased pressure on the availability of Cognac, particularly on VS,” says Frank.
But Cognac has remained resilient despite these setbacks – and demand is huge. The US remains the spirit’s biggest market, guzzling 86.5m bottles in 2017/18, and as such it is a key audience for Famille Naud. “American consumers are very conscious and there is a real demand for craft spirits with character and roots,” says Pierre Naud, Famille Naud sales manager.
The Far East has also demonstrated an appetite for Cognac, with volumes up by 13.5% and value rising by 12.4%. China imported nearly 26.2m bottles. In Europe, growth slowed slightly with volumes down by 2%, but value was up by 3%, suggesting premiumisation has truly taken hold in the region. Emerging markets with high potential, such as South Africa, Vietnam and the Caribbean account for more than 6.7% of global shipments – or almost 13.9m bottles.
When it comes to brandy, there’s still work to be done – the majority of consumers remain unaware that Cognac and brandy are the same spirit-type, separated by Cognac’s Appellation d’Origine Contrôlée (AOC). As such, the category has not enjoyed the same level of premiumisation as its French counterpart.
“Many brandies are at least in par with Cognac’s quality, but establishing credentials in such a varied category is challenging,” says Danie Pretorius, commercial manager, Oude Molen Distillery. Pretorius notes “pockets of excellence” for the brandy category, most notably in South Africa and the US. Meanwhile, forecasts from Euromonitor suggest brandy sales will have risen for a third consecutive year in 2018, to 1.43m litres worldwide.
Click through the following pages to see which brands we believe are ones to watch in the year ahead.
