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US spirits exports soar by 30%

Exports of US spirits reached a record high last year, but American whiskey failed to surpass pre-pandemic levels, according to a new report.

American whiskey is the key growth driver for American spirits exports

A new report from trade body the Distilled Spirits Council of the US (Discus) revealed US spirits exports climbed by 30% to US$2.06 billion in 2022.

Discus attributed spirits growth to the lifting of tariffs, the shift by consumers in key exports markets towards premium-and-above American spirits; the continued reopening of the global on-trade; and an increase in US distilleries, from less than 100 in 2005 to more than 2,600 today.

“While US spirits exports tumbled between 2018 and 2021, due largely to retaliatory tariffs on American spirits imposed by the EU and [the] UK, the latest export data show that US exports have rebounded to a record high following the suspension of the tariffs,” said Rob Maron, Discus vice-president of international trade.

While American whiskey exports soared by 32% to US$1.28bn last year, it remained below 2019 figures, due to punitive tariffs on the category that came into effect in June 2018.

The EU suspended its 25% retaliatory tariff on American whiskey in January 2022, while the UK axed its tariff on the category on 1 June 2022.

“US spirits producers have begun to recapture lost market share in the EU, but American whiskey exports to the UK still lag behind the 2017 pre-tariff level and the threat of tariffs returning continues to stifle growth in these top markets,” Maron added.

Maron called on the US government to secure the permanent removal of tariffs.

“If an agreement on steel and aluminium is not reached with the EU before the end of 2023, the EU will reimpose its retaliatory tariff at 50% on American whiskeys,” he said. “That will bring this renewed interest in American whiskey among EU consumers to a screeching halt.”

American whiskey exports have started to recover from retaliatory tariffs, Discus noted.

American whiskey exports to the EU reached US$566 million, accounting for 44% of the category’s exports (US$1.3bn). This surpasses the 2017 pre-tariff level of US$518m.

American whiskey exports to the UK increased by nearly 28% to US$112m last year. However, it is still down by 25% from the pre-tariff level of US$149m in 2017.

American whiskey accounted for 62% of all spirits exports by value in 2022, and 23% by volume.

The top five markets for American whiskeys in 2022 were: the EU (US$566m), Australia (US$117m), the UK (US$112m), Japan (US$102m) and Canada (US$80m).

EU leads spirits exports

Discus said global US spirits exports have nearly quadrupled over the last two decades, reaching US$551m in 2002. American whiskey is the key driver of growth.

The EU is the largest export market for US spirits. Approximately 34% of US spirits were exported to the EU, reaching a total of US$703m. US spirits exports to the EU grew by 25% last year, exceeding its 2017 pre-tariff level of US$603m.

After the EU, the top markets for American spirits in 2022 were: Canada (US$268m), the UK (US$159m), Australia (US$141m), and Japan (US$113m).

Discus said export growth was also driven by American rum, brandy, gin, vodka, liqueurs and cordials.

In 2022, exports of rum grew by 16% to US$109m; vodka soared by 57% to US$123m; brandy rose by 22% to US$18m; gin increased by 26% to US$51m; and liqueurs and cordials jumped by 44% to US$149m.

The top 10 states exporting US spirits were: Tennessee (US$817.8m), Kentucky (US$507.3m), Florida (US$344.6m), Texas (US$249.4m), Illinois (US$114.2m), Indiana (US$89.1m), Arkansas (US$67.3m), New York (US$65.4m), California (US$52.7m), and New Jersey (US$28.1m).

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