Economic growth in the U.S has been weak, but the Distilled Spirits Industry is expected to continue growing in 2008, as reported in the article below. 2007 saw impressive growth in revenue, and although 2008 may soften slightly, the numbers are still strongly positive. See these encouraging predictions below.
DISCUS Review/2008
Forecast: Eighth Consecutive Year of Growth in 2007;
Prediction: Growth Will Continue Despite Challenging Economy
For Immediate Release - 1/25/2008
Contact: Public AffairsTelephone: 202-682-8840
New York, NY – The Distilled Spirits Council (DISCUS) reported today that in 2007 distilled spirits grew for the eighth straight year, with sales up 5.6% totaling $18.2 billion and volume rising 2.4% to 181.5 million cases as consumers continued their fascination with cocktails and high-end products. The Council also reported that, despite a weakening economy, the growth would continue for a ninth year in 2008, forecasting sales growth of 4.6% to $19 billion with volume expected to rise 1.9% to 185 million cases.
“Consumer fascination with cocktail culture and the overall trend toward premiumization continued in 2007,” said Distilled Spirits Council President and CEO Peter Cressy at the Council’s annual industry review and forecast for media and Wall Street analysts in New York. “Obviously the reality of a softening economy will create new challenges in 2008. With the 75th anniversary of Prohibition repeal coming, it is important that we continue to eliminate archaic and inefficient blue laws and regulations. Improvements in market access have contributed to the industry’s growth.”
In presenting his industry data and forecast, DISCUS chief economist David Ozgo noted that spirits and wine increased market share in 2007, while beer lost share for the sixth year in a row. He attributed the 2007 growth to the following factors: continued premiumization; more consumers switching to spirits over beer; price increases and population growth.
“Despite the apparent economic downturn, I am confident spirits revenue will grow in 2008” said Ozgo, basing his forecast on the most comprehensive industry data available.
Ozgo also noted: Vodka, representing 24% of industry sales, saw a 7.65% revenue growth to $4.3 billion; Rum, representing 18% of industry sales, saw 8.9% revenue growth to $2.1 billion; Tequila, representing 15% of industry sales, saw 10.5% growth to $1.6 billion; and Whiskey (Bourbon, Blends, Canadian, Scotch and Irish) representing 29% of industry sales, saw 3.8% growth to $5.2 billion.
Record Export Revenue Exceeds $1 Billion DISCUS Senior Vice President for International Trade Debbie Lamb said 2007 was another record year for U.S. exports, primarily American Whiskeys. Lamb stated exports grew approximately 15% in volume in 2007 relative to 2006, hitting a record $1.01 billion (Preliminary).
“American Whiskeys have achieved remarkable global acceptance in a very short period of time and can now be found in more than 100 markets worldwide,” said Lamb.
She noted that DISCUS is beginning its 4th year of export promotion in emerging markets, which recently included China, Vietnam, Brazil, Chile, Romania and Bulgaria.Lamb indicated she expected the program to expand in the coming years.
Top countries for U.S. exports include: the United Kingdom, Canada, Germany, Australia and Japan.
Link to industry review here.
