In 2020, the global alcoholic beverages market totalled 279 billion litres valued at US$1.5 trillion.
After growing by an average rate of 4 per cent and 1 per cent per annum respectively between 2014 and 2019, the value of alcoholic beverage sales declined by 10 per cent and volume dropped by 8 per cent in the COVID-19-affected 2020.
The pandemic resulted in the shutdown of the on-trade across much of the globe for various durations and this negatively impacted on the overall consumption of alcoholic beverages. Sales declined after eight consecutive years of growth.
Statista estimates that the market size increased in 2021, but it will take at least until 2022 before the market recovers and surpass the 2019 pre-pandemic revenue. They estimate that from 2020 to 2025, sales will grow by 9 per cent and 3 per cent per annum in value and volume respectively.
Figure 1: Global market for alcoholic beverages over time, historical and forecast
Source: Statista
The spend on alcoholic beverages was negatively impacted by the COVID-19 pandemic in virtually all of the top 30 markets. However, Statista has forecast all markets to grow in the five years to 2025.
By the value of expenditure, China is the world’s biggest market for alcoholic beverages with a 21 per cent share. However, spending on alcohol has been declining, down by 1 per cent per annum between 2014 and 2019 and falling by the same rate in 2020.
The United States of America (US) is not far behind with a 16 per cent share. While spending on alcohol was hit hard in the US in 2020, it had been growing at 4 per cent per annum in the previous five years to 2019. The average spend per capita on alcohol beverages in the US at US$679 was more than three times that of China at US$201 per capita.
Of the top 30 alcoholic beverages markets, the fastest growing pre-COVID-19 were Indonesia and India. However, average revenue per capita is extremely low in each market at US$45 and US$33 respectively.
The markets with the highest average alcoholic beverage revenue per capita among the top 30 markets in 2020 were Norway, Switzerland, Australia and Canada.
Figure 2: Top 30 alcoholic beverage markets by value
Source: Statista
In 2020, beer was the largest category in the global alcoholic beverages market with a 73 per cent volume share, down from 74 per cent in 2019. According to Statista, beer’s value share is much lower at 38 per cent.
Wine is the second largest category by volume with a 12 per cent market share. Wine’s value share is almost double at 21 per cent.
Spirits are just behind wine in volume terms with an 11 per cent market share. However, spirit’s value share is much higher at 33 per cent.
RTDs and Cider are much smaller categories with volume market shares of 3 per cent and 1 per cent respectively. While cider’s share has been relatively stable, RTD’s market share has been on the rise, up from 2 per cent in 2018.
Figure 3: Alcoholic beverages market by category, volume share, 2020
Source: IWSR
There have been mixed results among the five major alcoholic beverage categories since 2019.
Volume growth in beer consumption was marginal in 2019 and declined by 6 per cent in 2020. IWSR has forecast beer consumption to partially recover the lost volume, with growth of 2 per cent. Global beer production peaked at 197 billion litres in 2013. Since that time, production has been gradually declining, falling to 182 billion litres in 2020. The biggest beer-producing countries are China, the US and Brazil. Beer was one of the beverage alcohol categories worst affected by COVID-19 during 2020, due to a combination of factors including exposure to the on-trade, rising competition from rival products such as RTDs, and a relatively small presence in ecommerce. Beer had been largely stagnant in volume growth terms before COVID-19, due to long-term consumption declines in key markets such as China, the US and Russia.
RTD is clearly the stand-out category for growth with consumption up 24 per cent in 2019 and expanding to 30 per cent in 2020, despite the pandemic. IWSR forecasts a similar rate of growth in 2021. The growth in RTDs is especially strong in the category’s two biggest markets, the US and Japan. Seltzers have been vital to the boom in RTD sales in the US in recent years, mainly as they’re seen as a lighter alternative (in carbs and in alcohol content) to beer in particular. This is consistent with the overall health and wellness trend. IWSR reports that new RTD launches coming to market have a higher representation of premium-and-above products than volumes consumed in 2020, suggesting a trend towards premiumisation.
Global wine consumption declined by 2 per cent in 2019 and the rate of decline was even greater in 2020 at 7 per cent. Like beer, IWSR has forecast a partial recovery for wine in 2021. The decline in spirits continued in 2020 and ISWR forecast only marginal growth for the category in 2021. Most of the value growth within the broader wine and spirits and categories over the past decade has come from the premium-and-above segment and this is forecast by IWSR to continue as consumers moderate the volumes consumed but increase the average unit spend.
Cider declined by 5 per cent in 2019 and was hardest hit in 2020 with an 11 per cent decline in 2020. In 2021, IWSR forecasts cider to recover only a small fraction of the volume lost in 2020.
Figure 4: Alcoholic beverages market by category, change in volume
Source: IWSR