For 1st Time, Spirits Revenue Tops Brewers' Sales

For the first time, sales by distilled spirits suppliers in the U.S. exceeded sales by brewers, the Distilled Spirits Council of the United States said.  Spirits supplier sales in the United States were up 5.1% in
2022 to a record $37.6 billion, while volumes rose 4.8% to 305 million 9-liter cases.

It was the 13th consecutive year in which spirits revenues gained market share of the total U.S. beverage alcohol market with supplier sales rising 0.8 share points to 42.1%.  Each point represents $890 million in supplier revenue. This represents the first time spirits supplier revenues have surpassed beer, which holds a 41.9% market share.

The achievement came as DISCUS celebrated its 50th anniversary.  Chris Swonger, DISCUS president/ceo, said:

"Year after year, the spirits sector has slowly gained market share by staying focused on our consumers, delivering innovative, high-end products, and  advocating to level the playing field for spirits, beer and wine products in the marketplace and legislative arena. As DISCUS celebrates its 50th anniversary,
spirits taking the lead in revenue share represents an historic milestone for all leaders in the spirits  industry, past and present, to toast.”

Spirits are experiencing their fastest growth in two decades, Christine LoCascio, DISCUS chief of public policy and strategy said, adding that spirits accounted for more than 42% of U.S. alcohol industry revenue in 2022, and 38% of total alcohol volume.  Suppliers have gained share for 13 years.  "This is the first time spirits has surpassed both beer and wine," she said.

The premiumization trend slowed overall in 2022 but still remained strong due to growth in the
Tequila/Mezcal and American Whiskey categories, LoCascio said.

LoCascio attributed the slower growth rate in 2022 to the softening of the economy, as well as the return to an average spirits growth rate following the pandemic-boost of consumers stocking up at the beginning of the pandemic and purchasing super-premium spirits for at-home bartending.

“More than 60 percent of the spirits sector’s total revenue was from sales of high-end and super-premium spirits, mainly led by Tequila and American Whiskey,” she said. “While many consumers are feeling the pinch from inflation and
reduced disposable income, they are still willing to purchase that special bottle of spirits choosing to sip a little luxury and drink better, not more."

Swonger explained that for many people spirits remained an "affordable luxury."

LoCascio noted that spirits ready-to-drink (RTD) products continue to be hugely popular among adult alcohol consumers looking for convenient quality cocktails made with premium ingredients and real spirits. Spirits RTDs remain a small but growing portion of the overall RTD market representing 13% of the total RTD market volume in 2022, compared
to 8% in 2021.

That growth in RtD sales has occurred despite what Swonger called unfair taxation, with rates as much as 13 times the rate for malt-based RtDs.  Getting state taxes on spirits RtDs reduced is a major DISCUS objective in its state government efforts.

The top five spirits categories by revenue in 2022 were:

  • Vodka sales flat totaling $7.2 billion
    • Tequila/Mezcal sales up 17.2% or $886 million totaling $6 billion
    • American Whiskey sales up 10.5% or $483 million totaling $5.1 billion
    • Brandy & Cognac sales down 12.3% or ($428 million) totaling $3.1 billion
    • Cordials sales up 2.6% or $73 million totaling $2.9 billion

The five fastest growing spirits categories by revenue:

  • Premixed cocktails including spirits RTDs up 35.8%, or $588 million to $2.2 billion
    • Tequila/Mezcal up 17.2% or $886 million to $6 billion
    • American Whiskey up 10.5% or $483 million to $5.1 billion
    • Irish Whiskey up 6.9% or $91 million to $1.4 billion
    • Blended Whiskey up 6.8% or $60 million to $940 million

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