As of November 13, the global volume of alcoholic beverages is set to decline further than expected due to a decrease in beer volume in the US and China, according to IWSR, previously called the International Wine and Spirits Record.
“The primary cause for the lowered projection is an unexpected drop in beer volume, driven mostly by economic and political pressures in the US and China,” read the release whose authors noted that beer volumes, previously expected to grow minimally, have a disproportionate affect on total alcoholic beverage figures.
IWSR’s primary metric is consumption, and that is what the forecasts referred to in the recent press release are predicting changes in, according to a IWSR spokesperson.
The IWSR update represents an unforeseen change in the market. As a result, it’s the first mid-year update in the company’s history. The next forecast update will not be until May 2026.
“Beer consumption is particularly tied to going out to bars and restaurants, but consumers in the US are choosing to stay at home more than expected because of cost-of-living pressures. When consumers buy alcohol to entertain at home, they make different purchasing decisions, and beer often loses out,” according to IWSR Managing Director & President, Marten Lodewijks.
Cost-of-living or “affordability” is a hot topic at the moment, influencing US trade and the tariff schedule, reported Expana (customer access only).
“Another pressure on beer volume in the US has been a marked decline in Mexican beer, which has been a key driver of US beer consumption for many years. Political and economic uncertainty among Hispanic consumers has brought down Mexican beer volumes, further dampening overall beer consumption,” said Lodewijks.
In recent years, beer has seen increased competition from other ready-to-drink alcoholic beverages like canned cocktails. Additionally, the alcoholic beverage products have also been exposed to competition with ready-to-drink cannabis, and hemp-derived THC products. Most recently, stricter guidelines on hemp-derived THC products (customer access only) were put in place as part of a spending bill passed to re-open the US government after the longest-ever shutdown.
Economic and political pressures have also caused alcoholic beverage volume declines in China too.
“In China, consumption has been hit by a government crackdown on luxury goods and a ban on alcohol at public sector events. Weaker than expected economic growth is also reducing spending at bars and restaurants as well as beverage alcohol spend generally. Reflecting this, beer and brandy volume forecasts for China have been adjusted downwards (although other categories remain largely unchanged).”
Written by Ryan Gallagher
