Global market review of cachaça – forecasts to 2016

Cachaça is the ninth-largest global spirits category at 82.67m nine-litre cases, deriving the vast majority of this volume from the domestic market, selling some 81.8m cases in Brazil in 2011. It has been widely tipped as the next big international spirits category. Much of that enthusiasm is based on potential, rather than actual, international performance to date. With Brazil scheduled to host both the Football World Cup in 2014 and the Summer Olympics in Rio in 2016, there has possibly never been a better time to build global awareness around the national spirit.

Campari managing director, South America Paolo Perego says: “We have been hearing for a number of years that cachaça is going to be the next hot category. There are some interesting things happening in export markets, although it is very difficult to forecast an explosion. Today we are operating in the reality that 98% of the volumes are consumed in Brazil. Maybe exports will eventually grow to 3%, 4% or 5% of total volume, but that is in the future. Today it is about Brazil.”

Leblon’s Luttmann sees parallels between cachaça and other rapidly internationalising categories. “Right now, cachaça is where Tequila was 15-20 years ago, and rum nearly 50 years ago. It's exotic, Latin, and a versatile white spirit. Like Tequila's margarita, there is a signature cocktail, the caipirinha, and most importantly, there is an aspirational culture and destination behind the spirit."

The question is why has cachaça made such little headway in export markets? More importantly, are the conditions for international success present and is cachaça finally poised for an international breakthrough?

This latest edition of just-drinks' and IWSR's unique review of the category aims to answer these questions and more, containing latest 2011-actual market consumption volumes by brand, domestic and export data and forecasted consumption.

Including analysis by The IWSR and interviews with the leading players, this report is the only complete research available for this fascinating spirits category with potentially huge international growth.

---- Report includes analysis of the recent Diageo-Ypióca deal -----

Table of contents

Chapter 1 Scope of the category
The product
International presence
Exports struggle in 2011
Export impediments
High-profile events
Improved packaging and presentation
Domestic challenge
Industry structure
Leading companies
Müller de Bebidas
Engarrafamento Pitú
Ypióca
Tatuzinho
Industria de Bebidas Pirassununga
Takeover activity
Growing multinational involvement
Comment from just-drinks – Diageo hunts down Pernod Ricard in Brazil
Tequila model
Cocktail culture
Confused with rum

Chapter 2 Performance of the markets
Brazil
Leading brands
Distribution structure
Highly regional market
Premium development
Ready-to-drink (RTD) growth
Competition
International markets
United States
Chile
Germany
Portugal
Spain
France
United Kingdom
Italy
Travel retail

List of tables
Table 1: Top ten spirits categories: 2006-2011 total volume by category ('000s nine-litre cases)
Table 2: Top ten cachaca export markets: 2006-2016 total volume by market ('000s nine-litre cases)
Table 3: Top ten cachaca export markets: 2006-2011 by total retail value (US$'000s)
Table 4: Top five cachaca exporters: 2006-2011 exporter and total volumes ('000s nine-litre cases)
Table 5: Top five cachaca export brands: 2006-2011 brands' and total volumes ('000s nine-litre cases)
Table 6: Top five spirits categories in Brazil: 2006-2011 category and total volume ('000s nine-litre cases)
Table 7: Top ten cachaca owners in Brazil: 2006-2011 owners' and total volumes ('000s nine-litre cases)
Table 8: Top cachaca brand lines for Muller De Bebidas: 2006-2011 volume ('000s nine-litre cases)
Table 9: Top five and total export markets for Cachaca 51: 2006-2011 volume ('000s nine-litre cases)
Table 10: Top cachaca brand lines for Pitu: 2006-2011 volume ('000s nine-litre cases)
Table 11: Top five and total export markets for Pitu: 2006-2011 volume ('000s nine-litre cases)
Table 12: Top cachaca brands for Ypioca: 2006-2011 volume ('000s nine-litre cases)
Table 13: Top cachaca brands for Tatuzinho: 2006-2011 volume ('000s nine-litre cases)
Table 14: Top cachaca brands for Industria de Bebidas Pirassununga: 2006-2011 volume ('000s nine-litre cases)
Table 15: Top ten cachaca brands in Brazil: 2006-2011 consumption volume ('000s nine-litre cases)
Table 16: Ready-to-drink market in Brazil: 2006-2011 volume ('000s nine-litre cases)
Table 17: Top cachaca brands in the United States: 2006-2011 brands' and total market volumes ('000s nine-litre cases)
Table 18: Top cachaca brands in Chile: 2006-2011 brands' and total market volumes ('000s nine-litre cases)
Table 19: Top cachaca brands in Germany: 2006-2011 brands' and total market volumes ('000s nine-litre cases)
Table 20: Top cachaca brands in Portugal: 2006-2011 brands' and total market volumes ('000s nine-litre cases)
Table 21: Top cachaca brands in Spain: 2006-2011 brands' and total market volumes ('000s nine-litre cases)
Table 22: Top cachaca brands in France: 2006-2011 brands' and total market volumes ('000s nine-litre cases)
Table 23: Top cachaca brands in United Kingdom: 2006-2011 brands' and total market volumes ('000s nine-litre cases)
Table 24: Top cachaca brands in Italy: 2006-2011 brands' and total market volumes ('000s nine-litre cases)

List of figures
Figure 1: Sagatiba
Figure 2: Caipirinha cocktail
Figure 3: Mixing caipirinha
Figure 4: Cachaça 51
Figure 5: Pitu
Figure 6: Cachaça 51 Reserva
Figure 7: World Duty Free Cocktail Bar

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