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Mezcal Rides A Surge Of Popularity In The U.S.

February 15, 2018

Though it remains a small player within the overall spirits universe, mezcal is enjoying a major boost in popularity, especially in the United States. Total U.S. volume is still tiny at under 400,000 cases—or about 2% the size of the Tequila category—but rapid expansion is underway, with shipments roughly quadrupling over the past half-decade.

“Mezcal is one of the fastest-growing premium spirits categories,” says Michael Gardner, global business leader for Del Maguey Single Village mezcal, which was acquired last year by Pernod Ricard. “It’s highly popular among key influencers and discovery seekers, and the cocktail space is particularly vibrant.” Gardner says the on-premise makes up 80% of Del Maguey’s business, though the off-premise is expanding, particularly in large metropolitan areas. The brand does equally well with men and women, he adds, and has found a niche with higher-end spirits drinkers. Del Maguey Vida ($36.99 a 750-ml.) is the brand’s most popular and widely distributed label, however the company produces 20 mezcals in all.

Along with Pernod Ricard’s acquisition of Del Maguey, Bacardi has a minority stake in Ilegal mezcal, William Grant & Sons handles Montelobos mezcal and Proximo Spirits has introduced Creyente mezcal. Also, in April, Diageo’s Casamigos Tequila brand will add a mezcal to its portfolio, retailing at $60 a bottle. Michelle Ivey, the director of operations for Ilegal, says the brand has expanded nationally since Bacardi acquired its stake last year, offering a Joven ($47), Reposado ($57) and Añejo ($99). “Ilegal has enjoyed tremendous growth, doubling in both volume and revenue, and we project the same results for this coming year,” Ivey says, adding that Ilegal depleted more than 10,000 cases in the U.S. in 2017.

Montelobos Mezcal Joven ($39.99 a 750-ml.), imported by William Grant & Sons, is another category star. Depletions surged by more than 80% in 2017, and brand manager Shem Blum expects the overall category to continue its rapid growth. Blum notes that the only real restraint to mezcal’s expansion is the potential for an agave shortage due to swift demand and the deforestation of wild agave. However, Montelobos itself will be insulated from that situation, Blum says, as the brand controls its own agave supply.

Joen Choe, vice president of marketing at Sombra mezcal parent company Davos Brands, says that people who enjoy Tequila, Scotch and other spirits with sophisticated flavor profiles make up a large part of mezcal’s current consumer base. Sombra Mezcal Joven ($35 a 750-ml.) rose by triple-digits in 2017, according to Choe.

Among the other brands vying for share of the rising mezcal segment are 3 Badge Beverage’s Bozal, Kimo Sabe (imported by Martinez Brands) and Gem & Bolt, a newer entrant which recently added industry veteran John Esposito to its board of directors.

Supply issues are a concern as mezcal’s growth skyrockets. Danny Mena, a partner for Mezcales de Leyenda, imported by M.S. Walker, says the spirit’s popularity is draining the Espadín variety of agave from Oaxaca, Mexico. “We’ve seen the price of the plant triple over the past two years,” he says, which could lead to higher retail pricing in the category moving forward. One plus, Mena observes, is that the legal denomination of origin for mezcal is geographically huge, allowing much physical space for agave growth. —Laura Pelner

Impact has a full report on the rising mezcal category in its February 1&15 issue.

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