The IWSR Drinks Market Analysis division is anticipating the travel retail liquor category will suffer a “particularly harsh decline” in 2020 and not reach pre-COVID-19 levels until 2024.
Presenting the company’s data for alcohol consumption in 2019 and giving forecasts for the coming years, IWSR Drinks Market Analysis CEO Mark Meek said: “While we’re still assessing the full impact of the current COVID-19 situation, it’s very clear that the pandemic is set to cause a deeper and more long-lasting aftereffect to the global drinks industry than anything we’ve experienced before.
“Even the downturn following the 2008 financial crisis was less severe than what we are seeing now. In many ways, 2019 was perhaps the last ‘normal’ year for the drinks industry.”
The IWSR has said alcohol consumption globally across all channels in the coming years will reflect the picture in travel retail and not recover until 2024, and that this recovery could be even later in the UK and the US.
Average global consumption across all channels grew by +0.1% in volume and +3.6% in value in 2019.
Total spirits dropped -2.5% in volume primarily because of steep volume losses in baijiu. Gin was the fastest-growing traditional spirits category (+6.1%) but the growth has slowed from +9.6% in 2018. Within whisk(e)y, Irish grew by +10.6%, Japanese increased +10.3% and US was up +5.8% in 2019. The IWSR said whisk(e)y and gin will rebound from COVID-19 fastest, but vodka volumes will not recover until after 2024.
The long-term decrease in wine consumption globally continued in 2019, with volume down -1.1% (though value was up +0.6%). The bright spot for the category is sparkling wine, which posted +1.4% growth across all channels in 2019.
Meek added: “A strong focus on innovation, premiumisation, and new routes to market such as ecommerce, are all factors which will help contribute to the industry’s rebound and future growth.”
