News & Politics
Shanken's Impact Newsletter

Shanken's Impact Newsletter August 1-15, 2018

Shanken’s Impact Newsletter, the leading source for exclusive data on the alcoholic beverage industry in the United States and internationally. Every issue features up-to-the-minute data and analysis on trends in the worldwide drinks market.

United States
M Shanken Communications
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in this issue

9 min.
upscale imports boost growth in wine market’s premium tier

WINE CONSUMERS CONTINUE TO MOVE toward higher pricing tiers, with domestic and imported premium-plus wines expanding their share of the 290-million-case U.S. table wine market. Wines priced $10 and above grew by 5.7% last year—or by 4 million 9-liter cases—to total 75.7 million cases, representing a 26.2% share of the table wine category. The import segment was largely responsible for that accelerated growth rate, which topped 2016’s 4.9% rise. While domestic premium-plus wines grew 2.8% to 55.6 million cases in 2017, imports shot ahead 14.6% to cross 20 million cases. Imported wines retailing above $14 stood out with a collective 17.5% volume gain in 2017 to 15.7 million cases. Domestic wines within that tier also posted volume growth, albeit at a more modest 2% clip to 42.6 million cases. Imported and…

10 min.
global players on the rise in china

AFTER A BRIEF PERIOD OF STAGNATION IN RECENT YEARS, IMPORTED SPIRITS AND WINE in China have returned to growth. While global economic conditions remain in a state of flux—with trade tensions between China and the U.S. a key source of concern—China appears on pace to meet its official target of 6.5% GDP growth for 2018, and its emerging consumer class continues to expand. China’s middle-class-and-above demographic—defined as individuals with monthly disposable income above RMB8,800 (about $1,300)—has grown by 30% since 2015 to reach 437 million this year, according to Pernod Ricard China’s internal figures, and is projected to reach 611 million consumers by 2024. Moreover, the group defined as “affluent”—with monthly disposable income of RMB25,000 ($4,000) and higher—is expanding significantly faster than the middle class, and now numbers around 36…

1 min.
premium positioning

IN VOLUME TERMS, THE U.S. WINE MARKET HAS BEEN inching along, eking out only small annual gains to stay in positive growth territory. Last year, the overall category was up 0.3% to 327 million cases, according to IMPACT DATABANK. But while the total market has been sluggish, wines retailing at $10 a 750-ml. and higher—comprising about one-quarter of all table wine consumption by volume—continue to rise at a healthy rate. In 2017, the $10-and-up segment accelerated its growth from the previous year, increasing 5.7% to nearly 76 million cases, while retail sales climbed 6.2% to almost $13 billion. Moreover, wines priced above the $14 mark have been growing faster than the popular $10-$14 category. In the past two years, wines retailing at over $14 have expanded by 5.4 million cases, and their…

1 min.
diplomático rum joins gallo spirits portfolio

E.&J. GALLO IS UPPING ITS PRESENCE in the luxury spirits category with a deal to become the new U.S. importer for Venezuela’s Diplomático rum brand. Previously handled in the U.S. by Domaine Select, Diplomático will be grouped in Gallo’s expanding upscale spirits portfolio, which also includes single malt Scotches Jura and Dalmore, and American brandies Germain-Robin and Argonaut. Diplomático was up 57% to 35,000 cases in the U.S. last year, according to IMPACT DATABANK’S estimate, and has been among the brands driving new-found interest in the higher-end rum segment, more than doubling in size since 2015. Gallo tells Impact it plans to expand availability of Diplomático across both the on- and off-premise markets looking ahead. Gallo will import three tiers of Diplomático rum: The Tradition Range ($27-$43), the Distillery Collection ($80),…

1 min.
australian exports up despite u.s. struggles

AUSTRALIAN WINE EXPORTS JUMPED 20% by value in the year through June, despite a 4% decline in the North American market. Australian shipments to the U.S. slipped by 8% to A$424 million ($314m), offsetting a 7% increase to A$199 million ($147m) in Canada. Meanwhile, China, by far the top market for Australian wines in value terms, surged 55% to A$1.12 billion ($829m), and other leading markets like the U.K. (+12%), New Zealand (+17%), Singapore (+27%), Germany (+19%), and Japan (+15%) all recorded double-digit growth.…

2 min.
wswa backs cannabis legalization

THE WINE & SPIRITS WHOLESALERS of America (WSWA) trade group is mounting a new push to convince Congress to recognize the legality of cannabis in states that have approved it for recreational use—but only if states agree to regulate cannabis as they do alcohol. The WSWA said that “similar to alcohol, the federal government should give the states the power to legalize cannabis, but should ensure they meet an appropriate regulatory threshold.” Cannabis has already been legalized for recreational use in nine states and the District of Columbia, but remains illegal under federal law. The WSWA noted that the legal cannabis market in the U.S. generated $7.2 billion in economic activity in 2016, and is expected to continue to grow. “This is something that everybody needs to engage on, because it’s…