Spirit Industry Challenges: Global Outlook
- global spirit producers are contending with a challenging mix of tariffs and potential brand boycotts,which could intensify the impact of evolving consumer preferences. The industry slowdown follows a...
- Rémy Cointreau estimates a 65 million euro ($55 million) hit to its business, even after taking mitigating steps.
- Beer, relying more on local production, may benefit from brewing trade disputes.
Global spirit producers confront a turbulent landscape, as tariff disputes and potential boycotts threaten to disrupt growth.These challenges, alongside evolving consumer habits, are reshaping the industry. The primary_keyword market faces headwinds from “sober curious” trends and economic pressures pushing consumers toward lower-cost options. Secondary_keyword impacts are already visible, with major players like Rémy Cointreau and Diageo adjusting strategies. BeerS reliance on local production gives it some insulation, while wines and spirits are more vulnerable. News Directory 3 provides essential insights into the pivot toward premiumization and the rise of ready-to-drink options. Analyse permanent shifts as the industry reconsiders cyclical versus structural changes. discover what’s next for the global spirits market.
Drinks Industry Faces Tariff Boycotts,Shifting Consumer Habits
Updated June 7,2025
global spirit producers are contending with a challenging mix of tariffs and potential brand boycotts,which could intensify the impact of evolving consumer preferences. The industry slowdown follows a decade of robust growth, particularly during the COVID-19 pandemic.
Whiskey bottles on shelves in a bar” width=”750″ height=”422″>
Whiskey bottles on shelves in a bar. Hiob | Istock | Getty Images
Rémy Cointreau estimates a 65 million euro ($55 million) hit to its business, even after taking mitigating steps. Diageo anticipates that duties will affect approximately 25% of its operations.
Beer, relying more on local production, may benefit from brewing trade disputes. AB InBev, Heineken, and Carlsberg maintained their full-year guidance in the first quarter.
Wines and spirits face greater risks from brand boycotts, as consumers may switch to locally produced alternatives based on political considerations.
The tariff impact arrives as the industry cools after a decade of growth, especially during the pandemic. Consumers spent more on alcohol in 2020 and 2021, boosting premium brands.
spirits are often viewed as an affordable luxury, particularly in strong economies. However, they tend to be occasional purchases, and manny consumers still have stockpiles from the pandemic era.
Variety packs of White Claw hard Seltzer are displayed for sale inside an Albertsons Cos.grocery store in San Diego, California. Bloomberg | Getty Images
As economic conditions shift, consumers might opt for cheaper ready-to-drink (RTD) options instead of higher-priced bottles.
Jefferies noted that spirits-based RTDs and cumulative inflation are affecting distilled spirits growth. downtrading is most evident in vodka and rum, while premium whisky, tequila, and gin demand remains stronger.
“During the pandemic, not only did people drink more, they premiumized more,” said Aujla. “That [premiumization] is on pause today, given the cyclical headwinds we have in the industry.”
A permanent dry spell?
The softening demand aligns with health and wellness trends, as more individuals become “sober curious” and reduce alcohol consumption. many drinks companies are introducing low and no-alcohol product lines to address this shift.
The rise of weight loss drugs, with early indications suggesting they can curb alcohol cravings, presents another potential challenge.
james Edwardes Jones, analyst at RBC Capital Markets, said there is considerable debate over the extent to which currently anemic demand is cyclical or structural.
Cyclical pressures include economic headwinds and excess supplies from the pandemic, while structural shifts involve evolving consumer behaviors.
Aujla said it is a bit of both, and more cyclical than structural. He added that when the cyclical headwinds dissipate, he thinks U.S. Spirits industry growth will be 1-2% lower than the 4-5% historical growth.