Tequila exports dipped last year for the first time since 2009, just as the higher end segments driving years of double-digit growth began to lose steam.
Exports came to 401.4 million liters in 2023, a decrease of 4.2% compared to 2022, according to a new report from the Consejo Regulador de Tequila (CRT), the body that regulates the agave spirit.
The CRT attributed the decrease to lower dynamism in the U.S. economy, competition in distribution channels and the rising price of agave (however, prices have recently started to fall). The decrease follows an upwards trajectory since 2009, when Mexico shipped 136.4 million liters annually.
The U.S. remained the largest destination for tequila exports, but decreased 5% compared to the prior year. Following the U.S., Spain (-7.1%) and Germany ( -21.9%) were top export markets, with France (+16.2%) and the United Kingdom and Ireland (+6.8%) reporting more positive trends.
Premium tequila brands boasting 100% blue agave have gained a significant share over less expensive mixto tequilas (not made with 100% agave), according the report, reflecting the influx and rise of premium-and-above products over the past decade. In value terms, tequila exports from January to November 2023 experienced an increase of 4.5% year-over-year.
The news comes as analysts are keeping an eye on the top end of the category’s recent slowdown. In sales data through August of 2023, tequila was one of the spirits where under $25 was performing better versus above $25 segments (+3.7% versus +2.6%).
The downtrading could be due to the democratization of tequila: as category appeal is broadened, the incremental consumer may come in at a lower price point. The category as a whole is still showing positive trends, up 1.5% in 2023 according to SipSource data and one of the top drivers of spirits growth.