Category: No and Low

Australian government invests $3 million to improve no/low wines

The Australian federal government has awarded a grant of almost A$3m (£1.6m) designed to boost quality and innovation within the burgeoning low-alcohol and alcohol-free wine market.

This grant from the Australian government’s Cooperative Research Centres Projects funding scheme will be used to drive further innovation and improve standards within the no/low category. The project is called ‘Advancement of Australian Lifestyle Wines’.

Australian Vintage, whose portfolio includes McGuigan and Tempus Two, will serve as the project lead for the research. The chief winemaker Jamie Saint said: ‘The grant allows us to conduct research with a key objective of optimizing the flavor and mouthfeel of no and low products, as well as drilling down into consumer and market insights of the category.’

The company will team up with 10 industry partners to conduct the research: Treasury Wine Estates, whose brands include Penfolds and Wolf Blass, along with the University of Adelaide, the Australian Wine Research Institute, Flavourtech, DrinkWise, Tarac Technologies, S. Smith and Son, Danstar Ferment, Mauri Yeast and CHR Hansen.

‘The opportunity to work with a group of leading industry partners to take the growing no/low category to the next level is something we are enormously excited by, improving the competitiveness, productivity and sustainability of the Australian wine industry,’ added Saint.

‘We want to position the Australian wine sector as the largest global producer of no/low wines.’

In 2022, the market value for no/low-alcohol drinks surpassed $11bn among 10 focus markets across the world, according to IWSR analyst data.

IWSR expects consumption to grow by 33% to $14.67bn by 2026, spearheaded by health-conscious adults in Germany, Spain, the USA, Japan and the UK.

No + Low Category Surpasses $11 Billion

The no and low alcohol categories grew over 7% in volume across 10 key global markets in 2022 to surpass a market value of $11bn, a new report from IWSR Drinks Market Analysis has revealed

Category consumption is expected to increase by a third by 2026, with the pace of growth forecasted to grow by a CAGR of 7% between 2022 and 2026, an increase on growth of 5% CAGR between 2018 and 2022.

Among the 10 examined markets, Australia, Brazil, Canada, France, Germany, Japan, South Africa, Spain, the United Kingdom, and the United States, the market value of no- and low-alcohol products surpassed $11 billion, up from $8 billion in 2018.

“The dynamic no/low-alcohol category presents opportunities for incremental sales growth as consumers are recruited from drinks categories such as soft drinks and water. Brand owners have an opportunity to recruit non-drinkers of alcohol,” said Susie Goldspink, head of no- and low-alcohol, IWSR Drinks Market Analysis.

“As more people opt to avoid alcohol on certain occasions – or abstain from it altogether – no-alcohol is steadily increasing its share of the no/low category.”

No-alcohol volumes grew by 9% in 2022, a CAGR it is expected to maintain between 2022 and 2026, and now accounts for 70% of the no- and low-alcohol segment, up from 65% in 2018.

No-alcohol beer and cider is expected to contribute nearly 70% of the overall category growth between 2022 and 2026.

“No-alcohol is growing faster than low-alcohol in most markets,” said Goldspink.

“The countries where this does not apply, such as Japan and Brazil, are early-stage low-alcohol markets with a small volume base.”

Germany remains the world’s largest market for the category followed by Japan, Spain, the US, and the UK.

Source:  IWSR

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