Cognac reports a strong year

Shipments of Cognac reached an all time high of €1.86bn in 2010, reports the Bureau National Interprofessionnel du Cognac (BNIC).

The spirit has held strong throughout the international economic crisis, only registering a loss in the value of shipments in 2009. Last year, however, saw an increase across all markets and categories of just under 30%, representing 12.8 million cases or 153 million bottles and an increase of 17.9% in volume. Production volume is also high at 555,000hl, putting Cognac in a strong position to respond to demand from buoyant markets.

All categories showing growth
2010 confirmed the shift in demand for superior quality Cognacs (VSOP, XO and exclusive blends), which now represent the lion’s share of the total market at 54.5%. The XO category grew by 36.6% and VSOP by 27% , with VS showing 6% growth over the year.

Changes in the way Cognac is drunk are, the BNIC believe, at the heart of the current growth with around 70% of all Cognac now drunk on ice, in cocktails or as a long drink, rather than as a digestif.

The 2010 figures show the global market for Cognac spread between three major geographical zones:

The Far East, which accounts for 33.2% of the world market in volume, saw sustained growth at +34.3% over the year. This now makes Asia Cognac’s biggest market in volume (4.42 million cases), having held first place in value since 2008.

The US, Canada and Mexico (Alena), with 32.2% of the world market, performed well in 2010, particularly the US, which is still the world’s biggest market in terms of consumption (3.89 million cases in 2010). The taste for Cognac among Afro-American and Hispanic consumers plays a major part in Cognac’s consistent growth in the US.

Europe, where shipments reached 30.5% of world volume (3.89 million cases), grew by 11.7 % in 2010. On the home market, where Cognac has been suffering for some time, it seems the French are rediscovering one of their national treasures, with shipments up by 18.3%.

Almost 97% of this French product is exported. Today export shipments account for 1.83 billion Euros in the country’s balance of trade – equivalent to the sale of 35 Airbus A320s.

1 January 2011 - Felicity Murray