Alcohol volume sales drop 3% in UK off-trade

Alcohol volume sales dropped 3% in the UK off-trade during the second quarter of 2013 as the market shows no sign of recovery.

Sales remain 3% down over the past 12 months, according to new Nielsen figures (year to May 25). They were revealed in the Wines and Spirits Trade Association Market Report, which shows an identical story of a 3% dip in the on-trade.

Nielsen divides the take-home market into eight categories and the only one showing volume growth is sparkling wine, which grew 7% in the past quarter and is now up 10% on last year to 487,000 hl and worth £417 million.

Still wine volumes dropped 1% in the past quarter and the category is 2% down on last year.

Italy and New Zealand are in double-digit decline, while Argentina and Spain are showing the most growth. 

Spain is enjoying 17% volume growth as its average bottle price of £4.64 is only beaten by Germany’s £4.32 in the UK’s top 10 countries of origin.

Despite a 1% volume drop Australia is still the top supplier to the UK, followed by Italy, the US, France and then Spain.

Despite the fall in alcohol volume sales, total alcohol prices were up by 2% in the off-trade for the year to May 25. This was largely down to the duty escalator, which increased duty on wines and spirits by a further 5.3% in this year’s Budget.

Still wine’s value has risen 2% and the category is now worth £5.4 billion to the take-home market.

Spirits are down 4% in volume in the past year but up 2% in value to £3.6 billion. The only spirit in volume growth over the past year was rum, driven by spiced and flavoured variants.

But the picture is better for spirits in the past quarter, with vodka volumes flat and whisky and gin also in growth.

RTDs showed the worst decline, down 14% in volume in the past quarter and 9% in the past year, and fortified wine is also down.

Cider was down 5% in volume in the past quarter, but producers will hope to see the decline arrested as we move into the summer months.

The beer category, despite enjoying a tax break as the Chancellor scrapped the duty escalator on beer and lopped a further 1p off the price of a pint, was down in both value and volume in the past quarter.

It is now worth £16.5 billion, down 3% compared to a year ago.

Miles Beale, chief executive of the WSTA, said: “While there are a small number of categories in the wine and spirit sector with modest volume growth, the overwhelming picture is one of decreased sales and increased duty rates, with consumers inevitably having to foot the bill.

“Since the introduction of the alcohol duty escalator in 2008, duty on wine has increased by 50% and spirits by 44%, putting the sector under significant pressure.”

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