World Spirits Report 2024: Rum’s Evolving Journey
Rum has long carried a reputation as the go-to party spirit, but the category is transforming. Despite some challenges, its move toward premiumization and global market expansion shows promise. In a recent article, The Spirit Business talks about rum challenges as a spirit with growth potential in the market. Therefore, we want to share some of the most relevant insights. Let’s get started!
Premiumization: A Mixed Journey
The push toward premiumization in rum has made some progress, though growth remains modest. According to IWSR’s US Navigator, the value-tier segment of rum declined from 52% to 42% in volume share between 2019 and 2024. Meanwhile, premium-and-above rums saw only a 1% increase, rising from 6% to 7%.
Dark rum, however, has emerged as a driving force behind premiumization, showcasing the potential for a more refined image within the category.
Regulatory Challenges Hinder Progress
One of rum’s biggest hurdles is its lack of standardized production regulations. According to The Spirits Business, Marten Lodewijks, president of IWSR’s US division, notes that this absence makes it difficult for brands to communicate a clear quality hierarchy to consumers.
Christian Barré, CEO of Havana Club, echoes this sentiment. He advocates for consistent regulations and classifications to help consumers understand regional distinctions and appreciate rum’s complexities on a global stage.
Education: Shifting Perceptions
Outdated perceptions also hold rum back. For years, many consumers viewed rum primarily as a mixer for tropical cocktails or an easygoing party drink.
Trudiann Branker, master blender at Mount Gay, highlights the ongoing effort to showcase rum as a premium spirit. She emphasizes that rum offers complexities comparable to whisky or Cognac. “For instance,” Branker explains, “there’s a misconception that rum is inherently sweet because it’s made from sugarcane.”
This shift toward premium, terroir-driven rums is gaining traction, supported by the booming cocktail culture. Venezuela’s Diplomático master distiller, Nelson Hernández, credits the rise of cocktails for driving premium rum growth.
A Global Perspective
Outside the US, rum is enjoying significant momentum. In the UK, on-trade rum sales surpassed £1 billion (US$1.2 billion), and super-premium-and-above rums are expected to grow at a compound annual growth rate (CAGR) of 8% from 2022 to 2027, according to IWSR.
Dark rum has particularly surged in Great Britain, with its value increasing 5% last year, reports CGA. Georgia Billing, Diplomático’s UK brand ambassador, notes that premium and super-premium rums rival whisky in popularity within the UK’s on-trade sector.
Emerging markets like China and Turkey and “accelerator” markets such as Mexico, Benelux, and Thailand, also present new opportunities for rum’s expansion, according to Havana Club’s Christian Barré.
Rum is steadily evolving from its party-centric roots to a premium, globally appreciated spirit. While challenges like regulatory frameworks and consumer education persist, the rise of dark rum, cocktail culture, and untapped international markets offer exciting growth opportunities.
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Source of information
The Spirit Business’ Article – World Spirits Report 2024: Rum
The image of the article is courtesy of © Eva Bronzini via Canva.com
