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U.S. Bourbon and TN Whiskey Drive Export Records in 2013

Market Opening Agreements, Cocktails, Quality and Heritage Drive "Global Whiskey Renaissance"

NEW YORK, Feb. 4, 2014 /PRNewswire-USNewswire/ -- American distilled spirits exports broke new records in 2013 crossing the $1.5 billion threshold, driven by premium Bourbon and Tennessee Whiskey which exceeded the $1 billion mark for the first time, the Distilled Spirits Council (DISCUS) reported today at its annual briefing for Wall Street analysts. 

"Eighty years after Prohibition Repeal, this global whiskey Renaissance is a trend that is benefiting producers, large and small, in the U.S. and around the world," Council CEO Peter H. Cressy said.  "These export records are driven by industry innovation, a very positive perception of American distilled spirits quality and heritage, and market-opening trade agreements."

Whiskeys Also Pace Steady Industry Sales Growth in U.S. Market

In the important U.S. home market, the Council reported steady supplier sales growth in 2013 of 4.4% to $22.2 billion, paced by whiskeys of all varieties; total U.S. volume growth was up 1.9% to approximately 206 million cases.  The Council estimated overall retail sales of distilled spirits in the U.S. market at upwards of $66 billion.

In addition, the group estimated overall market share versus Beer grew for the fourth straight year, rising by four-tenths of a point for a total of 34.7% share of the beverage alcohol market. 

Total market share gain since 2000, has been 6.0 points.  Each point of market share equals approximately $630 million in supplier sales.

Key factors cited as contributing to the U.S. market growth included industry product innovations; consumer fascination with premiumization, heritage and cocktail culture; expanded access through state market modernizations; and effective hospitality tax restraint by legislatures.

"The wide product selection spirits suppliers offer consumers again paid off with solid revenue growth," DISCUS Chief Economist David Ozgo told the gathering.  "For the first time in decades, all Whiskey categories saw some growth.  Whiskey was once the dominant spirit of choice for most Americans.  While growth had been picking up over the last few years, 2013 was a banner year."

Ozgo reported that Whiskeys of all varieties in the domestic market grew 6.2% to 52.7 million cases, worth just over $7 billion in supplier sales, up 10.1% or $643 million in 2013.  Highlights within the Whiskey category include Irish up 17.5% in volume to 2.5 million cases worth $500 million, up 20.5% in revenue; Single Malt Scotch up 11.6% in volume to 1.8 million cases worth $590 million, up 14.7% in revenue; and Bourbon and Tennessee Whiskey up 6.8% in volume to 18 million cases worth $2.4 billion, up 10.2% in revenue.

He also reported solid U.S. growth in several other categories including Tequila, which showed volumes rising by 6.6% and revenue up by 7.9%, with strongest growth particularly in the more expensive price segments and $148 million in new supplier revenue; steady growth in Cognac with volumes up 3.7%; and Vodka volumes up 1.1%, which given the enormous size of the category at 66 million cases, drove $122 million in new supplier revenue.

Another important development in 2013 cited by the Council was the continuing progress on key social responsibility indices.  According to the latest U.S. government data, underage drinking has declined to historic lows, and binge drinking rates by teens also continued their long-term decline.

"All tiers of the industry have committed themselves to fighting against underage drinking," Cressy noted.  "Public-private partnerships such as 'We Don't Serve Teens' and Century Council programs have contributed to the progress."

Key Factors Contributing to Record American Spirits Exports in 2013

According to Council Senior Vice President for International Trade Christine LoCascio, projected Bourbon and Tennessee Whiskey exports overall grew 5.0% from $956.8 million in 2012 to $1.005 billion in 2013, an increase of approximately $50 million

The projected top six 2013 growth markets for all American distilled spirits by dollar value were Japan (up $22.7 million to $120.8 million), Germany (up $19.6 million to $140.1 million), France (up $14.5 million to $130.5 million), U.K. (up $8.8 million to $159.6 million), Spain (up $6.5 million to $69.8 million) and Panama (up $5.8 million to $11.6 million).  The projected top 2013 markets by growth percentage were Nigeria (up 475.5% to $5.0 million), Panama (up 99.0% to $11.6 million), Greece (up 72.5% to $9.2 million), Georgia (up 47.6% to $6.0 million), China (up 40.4% to $11.8 million) and Belgium (up 33.6% to $18.3 million).

"There is a genuine affection for 'Brand America' as a symbol of quality and taste," said LoCascio. She also pointed to "the strong heritage backstory for American whiskey brands dating to George Washington, whose reconstructed distillery has received international media coverage."

Other factors LoCascio cited for strong American distilled spirits export growth were market opening and other trade agreements in recent years that have seen tariffs significantly reduced or eliminated in key countries and regions including Panama, China, Australia, Colombia, Korea and Chile, among others.

LoCascio also pointed to the Council's own export promotion program—Cheers from the USA—which, in partnership with USDA since 2005, has conducted American spirits promotions in 15 key targeted countries, and that currently has American Whiskey Ambassadors in China and India.

Other important contributing factors included a globally resurgent cocktail culture, into which U.S. Whiskeys fit well; rising middle classes with disposable income around the globe; and industry innovation in bringing new products to market, coupled with general premiumization trends around the globe, LoCascio concluded.

Here is the link to the slide deck: 2013 Industry Briefing

Here is the link to the supporting distilled spirits category data tables: 2013 Industry Review Supplemental Tables and Charts

The Distilled Spirits Council is the trade association representing producers and marketers of distilled spirits sold in the United States.

Website: http://www.distilledspirits.org

SOURCE Distilled Spirits Council of the United States (DISCUS)

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