US alcohol volumes drop despite strength of spirits

Wine and spirits volume sales surged ahead of beer in the US in 2017, but total consumption declined for a third year running.

Alcohol volume sales have declined in the US for a third consecutive year

According to data released by the IWSR US Beverage Alcohol Review database, US alcohol volume sales fell by 0.7% to 3.3 billion nine-litre cases.

The overall decline was a result of the struggling beer category, which witnessed a decline of 1.1% to 2.6bn cases – representing a loss of 29m cases for the category.

Spirits volume sales increased by 2.2% to 226m cases, while wine grew 1% to 363.7m cases – but this was not enough to offset the decline of beer, which is by far the largest alcohol beverage category in the US.

Within spirits, agave-based products showed the fastest rate of volume growth at 7.6% to 17.7m cases. Brandy (+5.3%), whisky (+3.7%) and vodka (+1.4%) also performed well, while liqueurs, gin and rum declined.

The value story of the US alcohol industry in 2017 was markedly different, showing overall growth of 1.6% to US$157.7bn.

Spirits continued to lead value gains, with Tequila, Cognac and American whiskey growing by 7.3%, 9.3% and 5.5% respectively.

Consumers increasingly viewed wine as an “everyday drinking occasion”, nudging value sales of still wine up by 0.9%, and sparkling wine by 4.3%.

Within its US Beverage Alcohol Review, IWSR notes that in 2017, consumers increasingly turned away from alcohol less due to health reasons, with 62% of the adult population consuming alcoholic beverages, down from 65% the year prior.

The number of wineries, breweries and distilleries increased by a combined 14%, leading to an increase of on-site purchases. There are now 2,531 distilleries operating in the US, according to IWSR data.

E-commerce now accounts for 8.9% of alcohol purchases, increasing 16% compared to 2016. Total alcohol retail sales grew 4.4%.

For an in-depth look at strategies employed by spirits brands in the US market, see our recent report, here.