Cognac sales to hit $10.2bn by 2032

The global Cognac sector is expected to be worth US$10.2 billion by 2032, according to a new report.

According to a report by Fact.MR, the worldwide Cognac market is forecast to increase by a compound annual growth rate (CAGR) of 6.4% in the 10 years to 2032.

Cognac is expected to be worth US$5.5bn in 2022.

The report said the category’s reach in the future could be boosted by the global popularity of luxury alcoholic drinks among millennials.

Asia Pacific is predicted to develop at the fastest CAGR of 4% in terms of Cognac sales.

Fact.MR said brand owners in the region are looking at whether to remove traditional labels in favour of age declarations as it could ‘enhance the comprehension and stability of Cognac’.

The report highlighted China and India as the region’s prospective Cognac markets due to their vast customer bases and rising disposable incomes.

The category’s leading market, the US, is predicted to expand at a CAGR of 4.9% over the next decade.

According to the latest figures from the Bureau National Interprofessionnel du Cognac (BNIC), global volumes of Cognac dropped by 4.8% in 2022 to 212.5 million bottles, as the world grappled with rising inflation, an energy crisis, and the aftershocks of the pandemic, with China still facing lockdown restrictions late into the year.

Despite the dip, 2022 was the third most successful year in Cognac’s history, with value sales rising by 8.4% to €3.9bn (US$4.3bn).

The BNIC said the US accounts for around half of Cognac’s annual global sales. Volume sales dipped by 3.2% in the US in 2022 to 111.3m bottles.

Meanwhile, exports of French spirits grew by double digits to €5.5bn (US$5.9bn) last year.

However, the sector’s exports fell by a fifth in the first quarter of 2023 due to increasing inflation, the Fédération Française des Spiritueux revealed in June.