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Global alcohol sales decline at faster pace than previous years

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Mary Ellen Shoup

By Mary Ellen Shoup+

Last updated on 05-Jun-2017 at 14:52 GMT2017-06-05T14:52:07Z

Alcohol sales shrunk by 1.3% in 2016 led by declining sales of vodka, beer, and cider. ©iStock/sbelov
Alcohol sales shrunk by 1.3% in 2016 led by declining sales of vodka, beer, and cider. ©iStock/sbelov

Global alcohol consumption is declining at a faster rate than it has for the past five years with diminishing volume sales of vodka, beer, and cider leading the downturn, a report from IWSR showed.

Global volume sales of alcohol dropped 1.3% in 2016 compared to an average rate of 0.3% in the previous five years, according to IWSR.

Vodka sales drag down global spirits growth

While global spirits consumption grew by 0.3% in 2016 boosted by volume sales of gin (+3.7%), tequila (+5.2%), and whiskey (+1.7%), diminishing sales of vodka (-4.3%) offset spirits growth.

“We can definitely highlight the importance tequila and English gin as the flagbearers of growth, mostly being led by developed markets,” Euromonitor alcoholic drinks analyst, Spiros Malandrakis, said.

Key growth markets for total spirits last year were China, the US and Mexico, according to IWSR.

The negative trend in vodka is largely due to steep volume losses in Russia (-9.3%), still vodka’s largest market, as the country continues to face an economic slowdown.

“We know that the Russian situation remains critical in many respects,” Malandrakis said. “Legislative changes there over the last couple of years have been quite catastrophic for major segments there.”

However, Malandrakis said that the situation is showing signs of a slow rebound.

Beer and cider see diminished demand

Volume sales of cider registered a 1.5% decline in 2016, largely driven by the US market which saw a 15.2% drop in sales after years of double-digit growth.

“While in 2015 it [cider] finally seemed to be making inroads in the US with a series of launches and a lot of promotional activity, this momentum appears to be dying off,” Malandrakis said.

Beer declines also sped up in 2016, with the category down 1.8%, compared with a five years of 0.6% drop in sales.

Three of the largest beer markets, China, Brazil and Russia, saw steeper declines than in previous years, decreasing 4.2%, 5.3% and 7.8% in volume sales respectively in 2016.

Champagne loses its fizz

One promising area of growth for the global alcohol market is sparkling wine, which was increased volume sales by 1.8% last year.

“Champagne is slowing down majorly at the moment, something that has to be contributed to the acceleration on the other hand of other sparkling wines such as Prosecco,” Malandrakis said.

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