Exclusive news and research on the wine, spirits and beer business

Exclusive: U.S. Spirits Outperformed Beer And Wine For Fifth Consecutive Year in 2016

February 6, 2017

The U.S. spirits market expanded for the 21st consecutive year in 2016, with a modest 2.5% gain to 221 million nine-liter cases. Wine is estimated to have increased by just 1.1% in the U.S. last year, while beer (excluding RTDs and cider) declined by an estimated 0.5%. Distilled spirits are poised to surpass beer in consumer-dollar terms by the end of this year or next, according to Impact Databank.

Whiskies outperformed all other spirits with a solid 3% gain last year, fueled by impressive growth from Irish whiskey, single malt Scotch, Bourbon/rye and flavored whiskies. White spirits advanced by an estimated 2.4%, with sustained increases from vodka and Tequila partially offset by flat rum sales and gin’s continued decline. Meanwhile, Cognac and flavored brandy saw double-digit gains while cordials/liqueurs are estimated to have declined for the fourth consecutive year.

Among the market’s fast-growing brands, E.&J. Distillers’ New Amsterdam vodka, which debuted in 2011, became the fastest spirit brand ever to reach 5 million cases in the U.S., after surging an estimated 15% in 2016. Other double-digit gains of note came from Fifth Generation Inc.’s Tito’s, now the U.S. market’s third-largest domestic vodka brand (it ranked 15th just five years ago); Moët Hennessy USA’s Hennessy, which is estimated to have become the U.S. market’s number-one brand in value terms last year, overtaking Diageo’s Smirnoff; Pernod Ricard’s Jameson, by far the market’s largest-selling Irish whiskey; and Cîroc vodka from Diageo, propelled by its new Apple flavor.

Flavored whiskies cooled off somewhat in 2016, but Diageo’s Crown Royal Regal Apple—selling more than 1 million cases—continued its double-digit progress, and new Crown Royal variants Vanilla and Honey made impressive debuts. Jim Beam Apple registered triple-digit growth, while most other major flavored whiskies slowed after torrid starts. Apple is the flavor of the moment among all spirits categories, as E.&J. Distillers’ New Amsterdam Apple vodka and E.&J. Apple brandy also registered strong initial growth, according to Impact Databank. —Juan Banaag

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