Global Tequila Market Outlook, 2028

Global Tequila Market Outlook, 2028

Tequila is a distilled alcoholic beverage made primarily from the blue agave plant and primarily produced in the region surrounding the city of Tequila, Mexico. It is commonly consumed as a shot, in cocktails like margaritas, or enjoyed neat or on the rocks. Tequila has gained significant popularity in recent years, and its consumption has been steadily growing worldwide. Factors contributing to the increasing demand for tequila include its unique flavor profile, the rise in interest in craft cocktails and mixology, marketing efforts by tequila producers, and the growing appreciation for agave-based spirits. Tequila has also seen increased interest among younger demographics and has become a staple in bars and clubs around the world. It offers a unique combination of sweet and earthy notes derived from the blue agave plant. The flavors can range from herbal and citrusy to caramel and vanilla, depending on the aging process and the specific tequila brand. It is a key ingredient in classic drinks like the Margarita, Paloma, and Tequila Sunrise. The variety of cocktails that can be made with tequila appeals to those who enjoy experimenting with different flavors.

According to the research report Global Tequila Market Outlook, 2028, published by Bonafide Research, the market is anticipated to cross USD 20 billion in size, increasing from USD 14.40 billion in 2022. The market is expected to grow at a 6.10% CAGR by 2023–28. Blanco tequila, also known as silver or white tequila, is tequila in its purest form. Blanco tequila retains the vibrant flavors and aromas of the blue agave plant, offering a fresh and crisp taste profile. It is commonly used in cocktails like Margaritas and is enjoyed neat or on the rocks. The increased interest in craft cocktails and mixology has contributed to the popularity of reposado tequila. Bartenders and cocktail enthusiasts appreciate its versatility as a base spirit for creating a wide variety of cocktails. The flavors of reposado tequila can complement and enhance other ingredients in cocktails, resulting in a well-balanced and flavorful drink. Aejo tequila tends to be more expensive compared to blanco or reposado tequila due to the additional time and investment required for aging. The extended aging can mellow and round out the agave flavors, resulting in a different taste. Extra Aejo Tequila, introduced in 2006, is aged for a minimum of 3 years in oak barrels. Joven, meaning young in Spanish, is a tequila that combines blanco tequila with aged tequila, or sometimes with other spirits or flavorings.

Tequila prices can vary widely, ranging from budget-friendly options to premium and ultra-premium brands. The cost of tequila is often influenced by factors such as the quality of the agave used, the production methods (such as whether it's 100% agave or a mixto), and the aging process (blanco, reposado, aejo, etc.). Value tequilas provide a good price-to-quality ratio, making them accessible to a broader range of consumers while still delivering enjoyable flavors. This makes them the most in-demand tequila type globally, with over 40% of revenues drawn. They can serve as an excellent option for mixing various cocktails and margaritas. Premium tequilas are a step up from value tequila and tend to be a little more expensive, reflecting the time and effort involved in their production. Millennials tend to value quality and authenticity in their purchasing decisions. There is an increased demand for super premium tequila as they tend to be more adventurous, and millennials are open to trying new flavors and are drawn to the distinct taste experiences that super premium tequilas provide.

Off-trade tequila sales have seen significant growth in recent years as compared to retail stores. Retailers can stock a broader selection compared to on-premise establishments, giving consumers more choices and access to a wider range of tequila products. Consumers can purchase tequila to enjoy in the comfort of their homes, experimenting with different cocktail recipes or sipping tequila neat. Consumers appreciate the convenience of purchasing tequila. Restaurants and bars provide an atmosphere for people to enjoy tequila with friends, colleagues, or family in a social setting. The ambiance and environment of these establishments create a unique experience that enhances the enjoyment of tequila. The professionals can showcase the versatility of tequila by crafting a wide range of cocktails, such as Margaritas, Palomas, and Tequila Sunrises. This creativity and expertise contribute to the popularity of tequila in on-trade establishments.

Mexico is the largest producer and exporter of tequila worldwide. The United States is the largest consumer market for tequila globally. The high demand for tequila in the United States significantly contributes to North America's share in the global market. Canadians are becoming more adventurous in their spirit choices and are increasingly exploring tequila as a versatile and enjoyable option. The country is home to a significant Mexican population, and their cultural influence has introduced tequila to a broader audience. Mexican restaurants and festivals showcasing tequila have become popular, contributing to the exposure and appreciation of tequila in Canada.

Tequila has become increasingly popular in the UK in recent years. The country has seen a growing demand for premium tequilas, especially in urban centers like London. Tequila bars and dedicated tequila menus have emerged, showcasing a wide range of tequila brands and expressions. The Margarita cocktail, made with tequila, has become a staple in bars and restaurants across the country. Tequila tastings, themed bars, and cocktail events have contributed to the increasing popularity of tequila in Germany. Spain has a deep-rooted drinking culture, and tequila has become a popular choice among Spanish consumers. Spanish consumers enjoy tequila both as a sipping spirit and in cocktails, with Margaritas and Tequila Sunrises being popular choices.

Tequila consumption in Australia has been steadily rising, driven by a growing interest in premium spirits and a desire for unique and diverse flavor profiles. Craft and artisanal tequilas have gained popularity in Australia. Australia has seen an expansion of tequila importers and distributors, resulting in a wider range of tequila brands available on the market. Mexican-themed bars, restaurants, and festivals have provided opportunities for Australians to experience and learn about tequila, enhancing its appeal and recognition.

While Brazil has traditionally been more associated with cachaça, the national spirit, the tequila market has been gaining ground and expanding its presence in the country. The combination of premiumization, cocktail culture, marketing efforts, and cultural influence has contributed to the growing popularity and consumption of tequila in Brazil.

The consumption preferences and drinking culture in the Asia-Pacific region differ from those in regions like North America or Europe. Traditionally, spirits such as whisky, vodka, and local spirits like soju, sake, and baijiu have dominated the market. Tequila, being a Mexican spirit, may not have the same cultural resonance or historical connection in most countries in the Asia-Pacific region. The availability and distribution of tequila brands may be limited in many parts of the Asia-Pacific region.

Recent Developments:
• June 2023, LeBron James' tequila brand just announced a limited-edition alcoholic drink. However, the new limited-edition drink will likely cost a lot more than $159. Only 9,000 bottles of Lobos 1707 Añejo will be available in select markets.
• June 2023, British brand Neurita has unveiled two Tequilas specifically formulated for mixing in Margaritas. Neurita is said to be ‘naturally sweet’, therefore omitting the need for triple sec in the creation of a classic Margarita.
• A well-loved brand for more than 40 years, Sierra Tequila has responded to consumer demand for lower-alcohol drinks with its new Tropical Chilli expression. The 18% ABV expression offers flavours of mango, passion fruit, and a hint of chilli. It is made with a base of Sierra Tequila Blanco.
• Cierto Tequila Wins Best Extra Añejo and Two Double Golds at the Los Angeles Invitational Spirits Challenge

Considered in this report
• Geography: Global
• Historic year: 2017
• Base year: 2022
• Estimated year: 2023
• Forecast year: 2028

Regions & Countries covered in the report:
• North America (United States, Canada, Mexico)
• Europe (Germany, United Kingdom, France, Spain, Italy, Russia)
• Asia-Pacific (China, Japan, India, Australia, South Korea)
• South America (Brazil, Argentina, Colombia)
• Middle-East & Africa (UAE, South Africa)

Aspects covered in this report
• Global Tequila market with its value and forecast along with its segments
• Region & Country-wise Tequila market analysis
• Various drivers and challenges
• On-going trends and developments
• Top profiled companies
• Strategic recommendation

By Type
• Blanco
• Reposado
• Anejo
• Others

By Grade
• Value
• Premium
• High end Premium
• Super Premium

By Distribution Channel
• Off-trade
• On-trade

By On-trade Distribution Channel
• Restaurants & Bars
• Liquor Stores
• Others

By Off-trade Distribution Channel
•Supermarkets & Hypermarkets
• Discount Stores
• Online Stores
• Others

The approach of the report:
This report consists of a combined approach of primary as well as secondary research. Initially, secondary research was used to get an understanding of the market and listing out the companies that are present in the market. The secondary research consists of third party sources such as press releases, annual report of companies, analyzing the government generated reports and databases. After gathering the data from secondary sources primary research was conducted by making telephonic interviews with the leading players about how the market is functioning and then conducted trade calls with dealers and distributors of the market. Post this we have started doing primary calls to consumers by equally segmenting consumers in regional aspects, tier aspects, age group, and gender. Once we have primary data with us we have started verifying the details obtained from secondary sources.

Intended audience
This report can be useful to industry consultants, manufacturers, suppliers, associations & organizations related to Tequila industry, government bodies and other stakeholders to align their market-centric strategies. In addition to marketing & presentations, it will also increase competitive knowledge about the industry.


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