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

Tequila Shows Strong U.S. Growth In First Half, Led By 100%-Blue Agave Brands

August 8, 2019

Tequila shipments to the United States were up 8% by volume in the six months ending in June, as consumers continued to trade up to 100%-blue agave offerings. The U.S. market accounted for nearly 84% of global Tequila exports in the year-to-date, according to recently released statistics from the Consejo Regulador del Tequila.

In the 26 weeks ending July 13, Tequila volumes in Nielsen channels were also up 8%, while case sales rose by nearly 10% in control states in the six months through June. The higher-priced 100%-blue agave segment saw a 12% increase in shipments in the year-to-date, accounting for 57% of all Tequila exports to the U.S. in the first half.

Luxury Tequila brands—retailing at $40 and above a 750-ml.—have been key growth drivers, and now account for 22% of the 18.3-million-case Tequila category in the U.S., according to Impact Databank. Luxury brands like Don Julio (+39%) and Casamigos (+57%)—both part of the Diageo portfolio—far outpaced the category in control states in the six months through June. The luxury segment’s leader, Bacardi-owned Patrón, rose by 14% in the same period, and continues to dominate the upscale tier at more than 2.4 million cases annually.

Slightly lower on the price ladder, Tequila labels like Hornitos (+8%), Cazadores (+14%), Espolòn (+30%), Milagro (+10%), Altos (+17%), Lunazul (+32%), and Jose Cuervo Tradicional (+29%) also posted robust growth in control states in the first half of the year. All of the above earned Impact “Hot Brand” honors earlier this year.

As demand for 100%-blue agave Tequila continues to surge, marketers including Cuervo, Campari, and Beam Suntory have noted that rising agave prices have been cutting into margins in the category. However, the agave supply squeeze is expected to ease over the next year, with Campari recently noting that it expects prices to fall significantly from 2021 onwards.—Juan Banaag

Subscribe to Shanken News Daily’s Email Newsletter, delivered to your inbox each morning.

Tagged :

Get your first look at 2020 data and 2021 projections for the wine and spirits industries. Order your 2021 Impact Databank Reports. Click here.

Previous :  Next :