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Data: Spirits outpace beer for US market-share supremacy

- By Bruce Schreiner and Jim Salter

LOUISVILLE, Ky. — Producers of spirits have new bragging rights in the age-old whiskey-versusbeer barroom debate.

New figures show that spirits surpassed beer for U.S. market-share supremacy, based on supplier revenues, a spirit industry group announced Thursday.

The rise to the top for spirit-makers was fueled in part by the resurgent cocktail culture — including the growing popularity of ready-to-drink concoction­s — as well as strong growth in the tequila and American whiskey segments, the Distilled Spirits Council of the United States said.

In 2022, spirits gained market share for the 13th straight year in the fiercely competitiv­e U.S. beverage alcohol market, as its supplier sales reached 42.1%, the council said.

After years of steady growth, it marked the first time that spirit supplier revenues have surpassed beer — but just barely, the spirit industry group said. Beer holds a 41.9% market share, it said.

“Despite the tough economy, consumers continued to enjoy premium spirits and fine cocktails in 2022,” Distilled Spirits Council President and CEO Chris Swonger said.

Overall spirit supplier sales in the U.S. were up 5.1% in 2022 to a record $37.6 billon, the group said. Volumes rose 4.8% to 305 million 9-liter cases.

Seemingly unfazed, Brian Crawford, president and CEO of the Beer Institute, insisted that beer “remains America’s No. 1 choice in beverage alcohol.”

“It’s interestin­g to hear liquor companies boast about making money handover-fist while simultaneo­usly going state-to-state hunting for more tax carveouts from state legislatur­es,” he said in a statement.

Benj Steinman, president of Beer Marketer’s Insights, a leading beer industry trade publicatio­n, said the beer industry saw unpreceden­ted growth in the 1970s, growing at a pace of 4% annually. As recently as 2000, beer’s share in the alcohol market was 58%.

Over the past several decades, beer’s growth has essentiall­y been flat. Meanwhile, spirits have flourished, especially over the past two decades.

“I think there’s just a long arc on these things,” Steinman said.

Steinman and Bart Watson, chief economist at the Brewers Associatio­n, a craft beer industry trade group, agreed there are several reasons for the shift.

“Some of it’s just the younger generation coming up, looking for a lot of variety,” Steinman said. “They sometimes like spirits. Cocktail culture is another thing.”

Watson cited data showing that liquor has become 20% cheaper relative to beer in recent decades.

“Price is a particular­ly large part of the story,” he said.

Another factor is advertisin­g and marketing. Watson pointed to the success of spirits in its outreach to women. Steinman said distilled spirits now advertise freely, something they didn’t do generation­s ago.

“They’ve increased their availabili­ty. They’ve increased their ability to advertise. They’ve had a lot of legislativ­e and policy wins that have enabled growth for distilled spirits,” Steinman said.

For spirit producers, reaching the market share milestone was worth toasting. At Baltimore Spirits Company in Maryland, the head distiller and the manager of its cocktail bar said they are pleased with the rise in the consumptio­n.

Eli Breitburg-Smith, head distiller and co-founder, said the firm’s founders saw a space in the market for rye whiskey as consumer demand was growing.

“We did see that it was going to be on the rise,” he said. “Now, I don’t know that we thought it would be overtaking beer or anything like that, but we felt like there was a good space in the market for new whiskey, original whiskey, and people that ... were making a unique product.”

 ?? JULIO CORTEZ/AP ?? Eli Breitburg-Smith, head distiller and co-owner of Baltimore Spirits Company, checks the quality of rye whiskey from a barrel Wednesday in Baltimore.
JULIO CORTEZ/AP Eli Breitburg-Smith, head distiller and co-owner of Baltimore Spirits Company, checks the quality of rye whiskey from a barrel Wednesday in Baltimore.

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