Impact Databank: Upscale Tequila Thrives Amid the Pandemic
December 15, 2020Even with a stagnant on-premise environment, the Tequila market continues to surge to new heights, and is expected to reach 20 million cases (excluding pre-mixed cocktails) in the U.S. for the first time ever by year-end, according to Impact Databank. Total retail value of Tequila in IRI channels for the 52 weeks ending November 29 soared 41% to $745 million, compared to a 22% gain for the entire spirits sector. Tequila shipment volume from Mexico to the U.S. increased 22.5% year-to-date through November, and comprised 88.5% share of all exports worldwide, according to the Consejo Regulador del Tequila.
Upscale brands ($30 and above a 750-ml.) have driven category growth for much of the past two decades, and the 100%-blue agave segment has once again outperformed the Tequila market overall year-to-date, with shipments to the U.S. rising 27.5% and comprising 60% of sector volume. While that dynamic has further advanced Tequila premiumization, it has also pressured near-term agave supplies, which continue to be strained. Production outages and supply issues are expected to continue into next year, as social distancing measures resulting from the pandemic have complicated the distilling process in Mexico and slowed total Tequila output substantially.
The upscale Tequila segment is led by Bacardi-owned Patrón, which is projected to be the fifth-largest selling spirit overall in the U.S. by year-end in dollar terms, according to The U.S. Spirits Market: Shanken’s Impact Databank Review & Forecast, 2020 Edition. Patrón’s volume rose 32% in IRI channels for the 52 weeks ending November 29, and the brand remains the second largest-selling Tequila label overall in the U.S., behind only Proximo’s Jose Cuervo. Other high-flying upscale brands include recent launch Teremana and two brands from Diageo: Don Julio (+83% in IRI the past 52 weeks) and Casamigos (+81%).—Juan Banaag
| Leading Tequila Brands in Control States At $30 and Over a 750-ml. (thousands of mixed cases) |
|||||
| Brand | Company | YTD Through October 2019 |
YTD Through October 2020 |
Percent Change1 |
|
|---|---|---|---|---|---|
| Patrón | Bacardi USA | 298 | 477 | 60.0% | |
| Don Julio | Diageo North America | 69 | 108 | 56.8% | |
| Casamigos | Diageo North America | 40 | 72 | 82.4% | |
| Avión | Pernod Ricard USA | 25 | 41 | 66.2% | |
| Herradura | Brown-Forman | 16 | 21 | 26.7% | |
| Teremana | Mast-Jägermeister | – | 17 | + | |
| Deleon | Diageo North America | 9 | 11 | 23.3% | |
| Gran Centenario | Proximo Spirits | 4 | 5 | 50.3% | |
| Total Leading $30 & Over2 | 460 | 752 | 63.5% | ||
| 1 Based on unrounded data. 2 Addition of columns may not agree due to rounding. Source: NABCA and IMPACT DATABANK © 2020 |
|||||
