The value of the nascent US non-alcoholic spirits* market could hit $13.3m by 2027, led by growth in the on-premise, data suggests.
Worth an estimated $8.93m in 2022, the US sold approximately 32,222 nine-litre cases (equal to 290,000 litres) of non-alcoholic spirits that year, according to analysis by GlobalData, Just Drinks’ parent company.
The analytics and consulting firm predicted this could rise to 40,000 nine-litre cases (360,000 litres) by 2027.
The on-premise and foodservice channel is predicted to grow faster than the off-trade in volume terms, recouping pre-pandemic levels by 2025.
The majority of non-alcoholic drinks are sold in the US off-premise – in 2022, the off-trade sold nearly twice the volume consumed in the on-premise and foodservice outlets. By 2027, however, the on-premise is set to have narrowed the gap.
In its report, United States Spirits – Market Assessment and Forecasts to 2027, GlobalData revealed Diageo held the largest share of the non-alcoholic spirits market in the US in 2022, led by its Seedlip, Aecorn and Tanqueray 0.0% brands.
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The next largest was domestic producer Spiritless, with Kentucky 74 and Spiritless, followed by Dry Soda’s Non-Alcoholic Botanical Bubbly and Pernod Ricard brand Ceder’s.
It comes as non-alcoholic spirits producers have also touted the US market’s potential.
In December, Australia-based non-alcoholic beverage company Lyre’s said it grew triple digits in the US last year and would be focusing its efforts between there and the UK in 2024.
Co-founder Carl Hartmann told Just Drinks: “We’ve got so much new business and wins that you’ll see into 2024 that we can’t take our eye off the prize in both markets and, you know, certainly not to discount other markets that have potential, but that just don’t have the materiality to move the needle as a market like the US does, for example.”
Scottish manufacturer Spirits of Virtue recently entered the US with its portfolio of non-alcoholic spirits and told Just Drinks the country was “ready to go pop”.
Roddy Nicoll, co-founder and CEO of the Clydebank, Glasgow-based distillery, said the UK was seen as an experienced market from which US distributors were keen to learn.
“As a UK-based exporter, we’re not just exporting quality liquids, we’re exporting knowledge of where the market’s going to go,” he said. “My [US] export partners are greediest to know: ‘Tell me what’s coming. How do we position ourselves?’”
Spirits of Virtue’s US distributor took an initial 40ft container with 19 SKUs and has since doubled that order, equal to around 45,000 bottles. “In non-alc terms, that’s a lot,” Nicoll said.
White Claw brand owner Mark Anthony Group held the largest share of the overall alcoholic spirits market in the US, with 15.9%. Last month, the Canadian drinks company released a non-alcoholic version of its flagship White Claw hard seltzer.
*GlobalData’s definition of non-alcoholic spirits includes non-alcoholic versions of alcoholic drinks, such as Silk Tree and Seedlip, which are positioned as spirit substitutes and have an abv of between 0% and 0.5%. It excludes all non-alcoholic beer and wine.