The U.S. beer market has experienced a nationwide decline of 3.6% in volume during the first eight months of 2024, compared to the same period in 2023, with almost all states showing negative trends. The decline is felt across the country, but performance varies between states. Some, such as Florida, Texas, and New York, saw declines that were below the national average, while others, including California, Ohio, and Georgia, reported steeper drops. Indiana was the only state to report growth, with a modest 0.5% increase.
This data comes from IWSR US Navigator, a trusted source for monthly volume data across the U.S. beverage alcohol market, including beer, wine, spirits, cider, ready-to-drink (RTD) beverages, and non-alcoholic products. IWSR’s figures are derived from local tax office data, offering a highly accurate view of the U.S. alcohol market, including performance across all 50 states since 2019.
Marten Lodewijks, President of IWSR’s U.S. Division, attributes the challenges facing the beer industry to a variety of factors. While no single issue stands out as the primary cause, these combined pressures have driven the beer category into a downward trend. Lodewijks noted that the situation varies from state to state, but generally, states that have performed better tend to show stronger growth in higher price tiers.
Super-Premium Segment Shows Resilience
Despite the overall decline, the super-premium beer segment stands out as a growth area. While the premium-and-above beer category has seen a slight decline of 1% in volume for January to August 2024, the super-premium segment has experienced a notable 4% increase. Super-premium beer, which has gained popularity in major markets like California, Texas, Florida, New York, and Illinois, is helping to mitigate losses in standard beer categories. Notably, several states, including Nevada, Indiana, Texas, and Maryland, have seen double-digit growth in this segment.
The shift towards more premium offerings can be attributed to evolving consumer preferences. As consumers look for more affordable alternatives to spirits and other alcoholic beverages, the super-premium beer category is benefiting. Lodewijks commented, “Consumers still get a sense of premiumisation while spending less out-of-pocket for a premium beer compared to a premium wine or spirit.”
Growth in imported beers, particularly those from Mexico, has also contributed to the success of the super-premium segment. These imports tend to be skewed toward higher-priced offerings, further driving the overall growth of premium beers.
Value Segment Declines Weigh on Overall Beer Market
The decline in the value beer segment has been a major factor in the overall contraction of the beer market. States like California, Illinois, Florida, and Wisconsin have seen significant declines in the value price tier, with some markets reporting double-digit volume losses.
The differences between states like California and others, such as Florida and Texas, stem from the growth in premium beer in the latter states. Florida and Texas, which both saw growth in the premium tier, were able to offset some of the losses from their value and standard beer categories. In contrast, California’s overall decline was exacerbated by the lack of growth in its premium beer segment.
This shift reflects an ongoing trend of “premiumisation” in the beverage alcohol market, where consumers are increasingly opting for higher-quality options, often in the beer category, as a more affordable alternative to spirits and wine.
Looking Ahead: Premium Beer Likely to Continue Strong Performance
As economic pressures continue to affect consumers’ spending habits, the premium beer segment is expected to remain resilient. Lodewijks concluded, “As long as consumers feel pressured by prices both within and beyond the beverage alcohol sector, it’s likely that premium beer will continue to perform well due to its lower out-of-pocket cost compared to other categories. The underlying consumer demand for more premium offerings will always be relevant.”
With the super-premium segment showing strong growth and shifting consumer preferences toward premium beers, the U.S. beer market’s trajectory in 2024 reflects broader trends in the beverage alcohol industry.
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