Mumbai, India – June 17, 2014 - The overall global spirits market sales increased only by a marginal 0.1% to 3.09 billion in 2013 which was a dramatic slowdown from 6.5% annual growth recorded in 2011. This slowdown was attributed especially to the slowdown in the growth of local spirits in China and India. Furthermore, the consumption of local spirits in several of the key market segments including countries like Germany and Russia have also affected the overall growth of the market. The total spirit consumption is expected to fall from 6.4% between 2007 and 2012 to a meagre 1.5% between 2012 and 2018. There are three major reasons that are being cited by market experts behind this decline - slow growth rate of the baijiu market which accounts for 38.7% of the total global spirits volumes, Russian government’s crackdown on alcohol consumption and the sudden end of India’s conversion to Indian Made Foreign Liquor.
This report: Global Spirits Market: Merger and Acquisitions April 2014, provides a review of the mergers and acquisitions (M&As), partnering deals, and analyzes the agreements entered into by companies active in the global spirits market during April 2014.
Whiskey - the largest growing category
As per reports on spirits market share, whiskey has been the largest growing segment in 2013, both in the global market and in each of the specific regions. The Asia Pacific region is the largest spirits market with volumes amounting to 1.93 billion cases and recording a rise by 0.1%. China continues to dominate the regional market, rising from 0.8% to 1.18% billion cases while India rose to 1.2% to 310.6 million cases. The slow growth of their economies greatly affected the growth, which had previously been in double digit figures in the previous years. On the other hand, America was found to be the largest growing region adding upto 4 million cases, about 1% more than last year’s 445 million cases. Europe, on the other hand recorded a decline, falling by 2.2 million cases. Spain too lost millions while Italy’s production fell about 500,000 cases short. The German market also contracted.
Despite consumers switching from the traditional white spirits to the trendier brown spirits, with Germany, Turkey and France recording the highest consumption, whiskey remained the fastest growing category in Africa and Middle East. Market experts also suggest that the increased consumption of whiskey was also spurred by the increased taxes on vodka in Russia.
Study of the global spirits industry has found that the imported spirits market segment is all set to grow at a faster rate (3%) than the local spirits market. While the preference of customers for these imported spirits is expected to soar, improving the market share, the local spirits market is also predicted to grow by 222 million 9-litre cases by 2018 whereas imported spirits are to grow only by a marginal 67 million cases.
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