Vinexpo: Mexican spirits seek growth

By Felicity Murray

The Drink Report


Mexico participated for the first time in Vinexpo, the global wine show, in Bordeaux, France, to promote Mexican beer and spirits. Mexico’s tequila and mescal producers tussled for premium recognition at Vinexpo in Bordeaux this week.

With sales of tequila and mescal are dominated by three large brands in Europe, the bulk of Mexico’s distillers are seeking to grab a larger share, particularly of export business. But the picture is complicated by what the producers see as poor perceptions of tequila, virtually no understanding of mescal, small promotional budgets and complex export and re-export structures.

In an attempt to solve the last two problems, the Mexican government’s Pro-Mexico promotion body was exhibiting at Vinexpo, Bordeaux, this week for the first time to showcase six tequila and two mescal distillers.

It is estimated that there are between 150 and 170 tequila and mescal distillers in Mexico producing around 25 million cases in 2012, according to Vinexpo/IWSR data. In the next four years sales are forecast to reach nearly 28 million cases.

Tequila is distilled from Mexico’s blue agave plant to produce two qualities: premium, 100% agave spirit and Mixto, agave blended with up to 51% other spirits. Mixto probably accounts for 90% of sales.

The smaller and medium sized distillers such as La Cofradia or Distilleria Santa Lucia producing 100% agave spirit claim that Mixto damages the image of tequila. “We must create awareness of premium tequila in Europe,” says Carlos Hernández Pérez, Cofradia’s export manager. “Tequila is getting a bad image,” he says. “People drink it as shots. But 100% agave tequila should be discovered as a sipping spirit to delight the palate.”

At present Europe accounts for circa 10% of premium tequila. Most of that finds its way into other European markets via Germany and Spain. Germany in particular is a large re-exporter; and the UK to a smaller extent.

Rodrigo Castro Vieyra, international sales and logistics manager for Distilleria Santa Luca, says Germany is a huge bulk importer of tequila. “In many cases the spirit is rectified, mixed with other spirit and re-exported.”

Mescal, meanwhile, made from other varieties of agave using small artisanal methods, claims to be benefiting from the tarnished image of tequila.

Mario Mendoza of family-owned Sin piedad mescale brand sees tequila’s image issue as an opportunity. “People want authenticity. Mescal is 100% agave and has a distinctive, smokey aroma and full taste. Chefs and mixologists are discovering it. Mescal is the coming thing.”

For the moment, though, mescal accounts for as little as 1% of agave distillation in Mexico. Finding distributors in Europe is a crucial part of the brand’s strategy. Brands like the top three – Heradura, Cuervo and Patron – besides being premium tequilas also have huge budgets.

“We can’t compete with that level of budget,” says Santa Luca’s Vieyra. Both he and Cofradia’s Hernández Pérez came to the show seeking distributors with the ability to be co-investors in their brands.

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One comment

  1. Of course there are two sides to every story, and the story of this article is the promotion of tequila, Mexican beer, and wine – all a sizeable portion of revenue for Mexico.

    Then there is my side of the story, which is that the only time I have ever tasted any of the three, was when I was around 8 years old in an Italian Tavern on the coast of California during a rabbit hunting trip, where all the men in the group drank Dago Red wine around the dinner table.

    Since most all of my family members were alcoholics, I guess that makes me one also, except that I have not swallowed a second time. Same with cigarettes . I never took a second puff, after not inhaling the first. Both alcohol and nicotine are poisons in our system, in that they destroy our bodies.

    My mother died when I was thirteen, my dad twice, at 60 and just before he was eligible for Social Security at 62, from smoking and drinking. My grandfather, uncle and aunt died of cancer from them also. After life at over 70 years, all my medical tests are normal, and with a body of one some 20 years younger, according to my doctors.

    As I, so is my wife. We have noticed that friends who have smoked and drank most all their lives, are eventually told that they must stop, or suffer the consequences.

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