The US wine and spirits market is grappling with uneven growth, according to the latest research from the Wine & Spirits Wholesalers of America’s (WSWA) SipSource data service.
The report, which tracks market performance from July 2023 to June 2024, reveals that while certain spirits segments such as reposado tequila and premix cocktails thrived in the second quarter of this year, the overall wine market continued to face significant challenges.
Within spirits, reposado tequilas stood out with a robust 10.7% growth rate, particularly at the premium end (products priced over US$50), which surged by 25%. Geographically, regions east of the Rocky Mountains fuelled this trend, with increases surpassing 19%.
Meanwhile, the ‘tequila-other’ segment, encompassing more affordable expressions, saw a 12.9% increase, driven by products under $17.
Premixed cocktails also showed strong volume growth, now comprising 14.9% of total spirits volume -a significant rise from 3.9% in June 2020. However, the report caveated that this growth was tempered by logistical challenges and declining sales due to lower prices.
“The continued volume growth in premixed cocktails is positive, but the lower prices are pushing down overall revenue for the category,” said SipSource analyst Dale Stratton.
In contrast, the wine sector experienced a more subdued performance. While prosecco managed a modest 2.6% growth rate in the April-to-June period, overall wine depletions fell by 8.2%. The research highlighted that 54.3% of table wine is now sold at below $8 per bottle, a factor that continues to hinder the wider wine category.
Wine cocktails offered a mixed picture, with canned products rising impressively in both volume and distribution, while products packaged in traditional glass or PET packaging declined.
The report also underscored the impact of rising costs on consumer behaviour. Despite a slight moderation in inflation in Q2, higher prices remain a significant concern. The Consumer Price Index (CPI) for alcohol rose in June by 1.8%, reflecting broader economic pressures on consumer spending.
SipSource’s data is collated from aggregated distributor depletion data from distributors in all 50 US states.
In an interview with Global Drinks Intel last week, Campari Group CEO Matteo Fantacchiotti conceded to a “challenging trading environment” in the US currently but said the group was well poised to capitalise on any upturn, possessing brands in two of the country’s best-performing spirits categories, tequila and aperitifs.
