Craft spirits and distillers are gaining immense popularity amongst the consumers across markets in the globe. The US is becoming one of the largest producers and markets for craft breweries. The rapid change in consumer palates, jaded existing products, ease in production, ease in regulations, and intensification of social drinking are some of the primary factors attributing to the growth of the craft spirits market in the US. The growing demand for premium and artisanal craft beers with distinctive flavors is encouraging vendors to launch new products in the US market. The luring mix of handmade craftsmanship, tons of culture, and locavore ethics are the becoming a signature criterion of product distinction of many breweries in the US market. Craft absinthe, liqueur, Amaro, and aquavit are expected to gain immense traction in the US market during the forecast period. The US craft spirit market is projected to generate revenues of over $20 billion by 2023, growing at a CAGR of more than 32% during 2018-2023.

The different types of craft spirits available in the US market are discussed in detail below:

·         Craft Whiskey

Bourbon, single malt scotch, blended scotch, and rye whiskey are some of the most common whiskey products in the US craft spirits market. The growing popularity of darker liquors, artisanal bourbons, and ryes are encouraging various vendors to launch new flavor profiles in the US market. With consumer awareness shooting up, whiskey producers are being more open about where their ingredients come from. Furthermore, a lot of new craft distilleries start off sourcing whiskey while they sit on their whiskey that is aging. For instance, Hillrock Estate and High West have taken this approach. Such initiatives will boost the demand for these products in the US craft spirits market helping it grow at a CAGR of around 32% during the forecast period.

·         Craft Gin

The millennials experiment with varying flavors, taste profiles, and prices are one of the primary factors attributing to the growth of craft gins in the US craft spirits market. Gins with unique and wider array of flavors have recently come out with citrus, regional fruit, herbs and spices, and floral ingredients, giving consumers new ways of accessibility and a broader variety of styles to try. The more well-defined flavor and complexity of craft gins will enable vendors to draw more consumers to the global market. The use of the products in classics and cocktails such as Martinez, gin and tonic, and a martini will boost demand for gin-based drinks in the US craft spirits market. The craft gin segment is expected to grow at a CAGR of over 32% by 2023.

·         Craft Vodka

The increasing focus on creating unique craft vodka styles with local ingredients is boosting the demand for these beverages in the US craft spirits market. The straightforward and easy method of distilling vodka and it does not require aging is encouraging large of producers to brew craft vodka in the market. The rising popularity of affordable and organic vodkas is another factor boosting revenues in this segment in the US market. Vodkas such as Square One and Tito’s thus had tremendous success in the US craft spirits market. The entrant of vendors from international markets will add to the growth of this segment in the US market. The craft vodka segment is projected to grow at a CAGR of around 28% over the next few years.

·         Craft Brandy

The revival of classic cocktails such as Sidecars, Sazeracs, and the Old Fashioned is contributing to the growth of the craft brandy in the US craft spirits market. With brandy offering up a whole lot of new styles due to the range of variables that lend to the possibility, the potential for the drink is humongous in the market during the forecast period. The adoption of the traditional European method and practices with new age American distilling traditions like aging brandy in the Bourbon barrels of American oak is gaining traction in the US market. The craft brandy segment is anticipated to grow at a CAGR of approximately 41% over the next few years.

·         Craft Rum

The high versatility and quality, which given the rapidly intensifying mixology scene, provides an edge and a huge opportunity of craft rum producers in the US craft spirits market. The focus on revitalizing classics such as the Mai Tai and the Daiquiri will create the demand for these spirits in the US market. The vendors are trying to elevate the humble rum by double-cask finishing and aging the drink in sherry, cognac or port barrels after resting it in oak ones to improve the flavor complexity of this spirit in the US market. The predominant trend in rum is premiumizing with high-end rums and introducing spiced variants in the market. The craft rum segment is anticipated to grow at a CAGR of around 34% during the forecast period.

·         Craft Liqueurs

The growing thirst for lower ABV drinks and demand for differentiation is fueling the demand for craft liqueurs in the US craft spirits market. Liqueurs that have natural ingredients and techniques of production, as opposed to chemicals, are thus finding an audience amongst bartenders as they are shelf-stable, consistent, and measurable. New regulations have allowed buying of cocktail fixings at the farmers’ market in certain states. The growing popularity of unusual flavors that have a veggie base such as yuzu, bergamot, and rhubarb will transform the US craft spirits market. The craft liqueurs segment is estimated to grow at a CAGR of more than 32% during the forecast period.

The leading vendors in the US craft spirits market are Diageo, Pernod Ricard, Bacardi, St. George’s Spirits, and House Spirits Distillery.

Read: US Craft Spirits Market - Industry Outlook and Forecast 2018-2023

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