Cognac regroups to recover from category crash
A crash in the market for Cognac, brought about by multiple causes, is forcing producers to regroup and take a radically different approach to their offerings for short-term survival.
*This feature was originally published in the May 2026 issue of The Spirits Business magazine.
“Sometimes it’s hard to look back to where we were 18 months ago compared with where we are today,” says Cyril Camus, fifth-generation owner and CEO of Cognac house Camus. “In line with the overall industry, we’ve suffered a drop in our shipments, both in volume and value terms.
“We’ve had to go through a pretty substantial restructuring and reorganising of the company in the markets and the headquarters in Cognac, to adjust to what I consider is a new reality. I believe the low level of shipments in Cognac are here to stay for a while. That has been… well, painful would be an understatement.”
Painful. It’s a good adjective to describe the performance of the Cognac category of late. Global exports of Cognac have plummeted in the last year, both in volume and value. And the losses are in the double digits.
Data from trade body the Bureau National Interprofessionnel du Cognac (BNIC) revealed a decline of 15.1% in global Cognac shipments to 141 million bottles last year. Value was down by 25.3% to €2.24 billion (US$2.6bn). Showing the current price sensitivity of the market, VS is down by 16.2%, VSOP is down by 11.5%, and XO and above fell by 23.2%.
Largely pinned to the US and China, declines in both major markets for Cognac have had a substantial impact. In July 2025, anti-dumping duties averaging 32.2% were imposed on Cognac shipments to China – Cognac’s second-biggest market – in retaliation for European tariffs on Chinese electric vehicles.
In the US, meanwhile the hurdle is tariffs. The introduction of 15% tariffs on all European products, combined with an unfavourable euro/dollar exchange rate for Cognac, has led to price increases of around 30%. The US, Canada, and Mexico collectively recorded a 19.4% decline in volume to 56.9m bottles shipped, while value plummeted by 34% to €737.3 million. But the declines go further. In Europe last year, exports fell by 10.9% in volume to 28.2m bottles and by 22% in value to €359.5m.
It’s clear to see that standing still is not an option in this market. Innovation and marketing moves by global brands and family-owned producers alike are aligned on seeking growth, though approaches and opinions on the category’s outlook differ.
With declines heaviest at the top end of the market, it makes sense that brands are tackling one of Cognac’s biggest issues, pulling in new consumers. Exploring entry-level liquids, in March Rémy Martin launched Rémy V to the US market. Not a Cognac, this “fresh, modern white spirit distilled from 100% French grapes” and offered at 35% ABV, has been “crafted to empower a new generation of drinkers”, according to a press release to mark its launch. The liquid is, it claims, “a statement of authentic self-expression”.
Centred on approachability and carving out a new image for the brand with consumers not currently engaged with it or Cognac at large, its initial pitch is at summer drinking and emphasising its bright fruity, floral notes.
Next generation
For Pernod Ricard’s Martell brand, a push behind its 2018 launch Martell Blue Swift continues. The first VSOP Cognac aged in Bourbon barrels, it’s intended to resonate with American whiskey consumers, with a more approachable profile of vanilla and toasted oak.
“As a global category leader, we have the opportunity to shape the category for the next generation,” says Sébastien Borda, the global marketing vice-president in charge of prestige brands in the aged spirits, wine and Champagne division of Pernod Ricard.
“While heritage remains one of Cognac’s core strengths, bringing products to market that reflect changing consumer expectations is a challenge and an opportunity in a category so deeply rooted in tradition,” he adds. “It requires boldness: a willingness to break with convention, and explore new territory while respecting the category fundamentals.”
Its wider marketing pushes in the portfolio include a trade and consumer programme in the US that reimagines classic cocktails with Martell as their base, showcasing the brand’s smoothness in mixed drinks, something it says is a key lever to recruiting new consumers, especially in casual, off-trade occasions which are key in the US market.
“By contrast, in Nigeria, a strongly emerging market, we’ve created The Martell Tower [an experiential hub], bringing the brand to life across mixology, gastronomy, fashion, and music, which has demonstrated how we can host locally-resonant experiences through culture,” adds Borda. “We also signed [musician] Davido as global ambassador in 2022, which has enabled us to become part of the rising Afrobeats cultural movement and position Martell as a relevant and desirable brand to his audience.”
For Delamain, market declines have also led to a step in a new direction. “Overall, in two years, the export declines has nearly cut the opportunity by two. That’s pretty huge,” says Eric Le Bouar, the brand’s managing director.
“Delamain is very lucky to be spread in terms of geography. We do not have any market that represents more than 15% of our total global revenues, which is, of course, something that helps in this situation. All the markets are in strong decline.”
As well as soft demand in China, “Russia, which was once a key market, is now close to zero”, and the important Western Europe market is also falling, which Le Bouar credits to the impact of the moderation trend – something he sees as ultimately good for Cognac, with driving consumers to opt for quality – as well as simple economics. “Most of the mature markets are struggling in terms of economy,” he adds “and as a consequence, people locally have suffered from inflation and are extremely cautious about what they spend and why they spend it.”
Accessible entry point
To remedy this, its approach is also centred on accessibility. In May it launches Delamain Folio Natura. Named for the collection of books created by ornithologist Jacques Delamain to open up the natural world to as many people as possible, it aims to offer an accessible entry point.
While over 90% of Cognacs are made from Ugni Blanc, Folio Natura combines Folle Blanche and Colombard grapes from Grand Champagne too, which add “liveliness and exuberance”, and is aged for six years. It will debut in France, the UK, and most European markets, followed by the US at a later stage. “It’s super-exciting,” adds Le Bouar. “It’s a liquid that is very easy to drink, easy to understand. It’s very fresh. It’s extremely fruity, but it’s still very Delamain. There is no wood, it’s just the fruit that we are bringing into the bottle.”
Offered at an RRP of €60, it’s a radically accessible price point compared with the brand’s current entry-level product, Pale & Dry XO at €145. It’s also recommended served neat, or mixed in cocktails, including Highballs. “Of course, when you are at this price point, you can be distributed or listed in many more accounts,” adds Le Bouar. “Regular hotel bars, everyday bars, everyday restaurants. So it will help us to grow numeric distribution for Delamain as well, and we know that numeric distribution also means visibility for the consumer.”
Quality and price points are two key factors Le Bouar points to as critical in the category’s decline, adding that maintaining quality with Folio Natura has been vital. “There has been a trend to increase price, particularly because the demand was increasing and the supply was not,” he adds. “At some point, the gap between the price that is paid and the quality has mathematically widened.”
Cyril Camus describes the necessary shift away from the luxury market as “frustrating. It’s been difficult to basically protect oneself and go into a slower growth mode, one that is not driven by premiumisation but by more aggressive pricing and promotions,” he says. “Almost everywhere in the world, there’s a growing lack of confidence in the future. Consumption of Cognac is always higher when people are optimistic about the future.”
The restructuring of Camus has included reductions in staff, debt, and portfolio breadth alongside reworking industrial processes for better efficiency, something Camus says was “not a purely defensive exercise. It’s a change of mindset,” he adds. “We have to be very pragmatic and stick to things that function well in that environment. So, price promotions, price off, gift with purchase, things of that nature. It’s a little bit frustrating, to be quite honest. It’s less brand building. We have to put the transformation of the category on hold while the markets are negative, to focus on spending the money on what has an immediate impact on sales.”
Gen Z appeal
Recent activity by the brand has included the Camus Single Serve collection. Partnering with London retailer Fortnum & Mason, in May 2025 it launched 30ml bottles of eaux-de-vie aged for more than 20 years, selected and blended by Camus cellar master Julie Landreau. Offered in Fruity, Floral, and Spicy varietals it was presented in bottles inspired by perfume-bottle designs for £39.50 (US$53.40) each. Akin to Louis XII ‘The Drop’ bottles, which reimagined the pack as 10ml wearable bottles for Gen Z, that balance between price and accessibility is clearly in tension here too.
The brand is working through its range with a pack refresh, starting with XO to give a more contemporary look and feel. The rollout across all products will take about two years.
The good news? These measures have worked. “After two years of double-digit drops in sales, we’ve now had two successive quarters of significant growth for the company,” adds Camus.
“The industry has been really quick to work together to restructure, realign, manage the impact of a reduction in production on growers, and is now ready two years into a crisis to be back in conquest mode. That’s very fast.”
Where will this conquest mode take the category next? “There are some green shoots demonstrating the dynamism of Cognac, notably in South Africa, which has become the number-four export market for Cognac,” says Martell’s Borda. “Countries like Nigeria, Thailand, and Kenya have also shown strong multi-year growth for Cognac, representing important drivers for diversification. This is echoed in Asia beyond China, where Martell stands to benefit in markets such as Singapore, Taiwan, or Indonesia due to the region’s continued appetite for premium spirits.”
India is the great white whale, according to Camus, now that the EU and India reached a tariff agreement in January. He points to negotiations between Europe and Vietnam and Indonesia as well. For India, though there’s demand, barriers to entry remain high, with little to no current awareness of Cognac. That blank slate, however, is an opportunity in a potentially massive market. Expect brands to invest to unlock it. It’s worth noting industrywide that a necessary reduction in production now may cause tension over supplies of younger liquids in years to come.
What is the bottom line? “We have to find ways in a larger number of countries, to make Cognac as relevant to consumers as it had become in China and the US,” concludes Camus.
Industry insights
To what extent is the current Cognac downturn being driven by macroeconomic pressure versus category-specific issues?
Alexandre Gabriel – owner and master blender, Cognac Ferrand
“I think we have to be honest with ourselves as an industry, and I say this as someone who loves Cognac deeply, who has dedicated his life to it.
The macroeconomic pressure is real. Consumers everywhere are being more careful with their money, and premium spirits are not a necessity. That affects everyone. But if we use that as the only explanation, we are not being fully truthful.
“Cognac grew enormously over the last decade, but that growth was also concentrated, too dependent on a handful of markets, too reliant on a few consumption occasions, too focused on chasing volume rather than building genuine, lasting relationships with consumers. When you grow that fast and that narrowly, you are building risk without always seeing it.
“I also think that not everyone in the category invested equally in educating the consumer, in telling the full story of what Cognac is, where it comes from, what makes it extraordinary. Premiumisation without education is just a price tag, and consumers eventually see through that. With Cognac Ferrand, this has always been our focus, investing in the trade, in bartenders, in sommeliers, in the people who carry that story forward with genuine conviction. That kind of work doesn’t show up immediately in your numbers, but it builds something far more durable than any campaign.
“What gives me hope is that the soul of Cognac is intact. The terroir, the craftsmanship, the liquid, when made with real care and intention, it is among the most extraordinary spirits in the world. Downturns are painful, but they are also clarifying. They push you back to what really matters.”
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