Spirits report shows mixed demand in EU
Rabobank’s Spirits Quarterly Q1 reports that while the demand for spirits across Europe has been mixed, in the US the spirits market continues to grow with value still outpacing volumes. On the other hand, a heavier discounting arises in China triggered by the increase of e-commerce and consumer migration away from the luxury segment of the Chinese spirits market. India appears to have returned to growth mode with Brazil following this trend due to diversification and innovation across brands.
“The US market is currently experiencing its slowest rate of volume growth since the recession. While the overall trends in the US market remain positive, it should be noted that the ongoing premiumisation trends (particularly in whiskey) and the success of several new key product innovations, which have helped drive the success of the market, have masked some of the underlying challenges. Volume growth remains positive, but there has been a marked slowdown in the rate of growth in 2014,” explains Rabobank’s global strategist – beverages, Ross Colbert.
The past months have shown some signs of stabilisation in the European spirits sector, but as the mixed financial results of the major spirits companies such as Pernord and Gruppo Campari show, we are not out of the woods yet. Scotch producers are facing another hurdle as export figures for 2014 are showing signs of a slowdown in the sector, while high quality aged sipping rums are winning over consumers in the UK, Benelux, France, the Nordics and eastern Europe.
