Content of the study:
The rum market - France

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MARKET OVERVIEW

1.1 Presentation and definition of the rum market

The rum market in France refers to the economic activity related to the production and sale of rum.

Rum is a brandy originating in the Americas, produced from sugar cane. The rum market is a sub-segment of the spirits market: drinks made from distilled alcohol. There are two types of spirits: simple" spirits (rum, whisky, gin, vodka), whose taste is linked to the distillation of the raw material, and "compound" spirits, such as aniseed-flavored aperitifs.these include "simple" spirits (rum, whisky, gin, vodka), whose taste is derived from the distillation of the raw material, and "compound " spirits, such as aniseed-flavored aperitifs or liqueurs, whose taste is derived from the addition of aromatic substances to a neutral alcohol or brandy. Rum is consumed as a beverage or in cooking.

There are different categories of rum:

  • white rums
  • amber rums
  • aged rums
  • spiced rums

The global spirits market is dominated by North America, followed by Western Europe. The white spirits and rum category accounts for a very large share of the global spirits market. The global rum market is growing and is set to remain so in the years ahead, largely dominated by a few international brands.

Like the global market, the French rum market is also dominated by international spirits giants. However, it remains attractive to new independent players such as RhumRhum and A1710. The French market is growing in both volume and value. given the specificities of the French tax system, spirits production is concentrated in the French overseas departments and territories. Distribution is largely organized through supermarkets.

White rums dominate the market, followed by amber rums. The spiced rums segment is one of the most dynamic, although it accounts for only a marginal share of the market.

In France, the rum market is stable, with a slight decline of -1% between 2020 and 2021. It is the spirit with the highest sales, ahead of vodka, liqueurs and gin. The market leaders in France are Captain Morgan, followed by Old Nick and Saint James. In thesame year, France's main rum export customers were the United States and Germany (13% each of total exports), followed by Italy and Belgium (6% each).

The rum market can draw on the cocktail trend , which is helping to renew rum's image and stimulate demand. In fact, this is one of the main lines of communication used by the major rum brands on the French market.

1.2 The global rum market is growing

The global spirits and rum market

The spirits industry was hit hard by the restrictive measures imposed by the pandemic: the ban on going out and the absence of festive or social occasions led to a drop in spirits sales and consumption. In ****, the sector began to recover, and market growth ...

1.3 Key figures for the domestic market

The French spirits market

Consumption of spirits in France is up overall on ****, at ***.* million liters in supermarkets (***).

Breakdown of supermarket sales by spirits category (***) France, ****, in Source: ****

Sales in the spirits industry are estimated at **.* billion euros. (***)

A market subject to geopolitical uncertainties

Despite a good recovery from the pandemic, ...

1.4 Foreign trade in rum

evolution of the French rum trade balance France, ****-****, in millions of $ and as a % of sales Source: UN Comtrade Code: ****** - Rum and other spirits obtained by the distillation of fermented sugarcane products

France is a net exporter of rum, and there has been a definite increase in its coverage ...

1.5 Effects of COVID-19 on the wine and spirits market according to a market expert

This interview was conducted by a Businesscoot analyst with an industry expert (***)

How do you see the impact of the COVID-** crisis on the wine and spirits market?

My feeling is that the major trends are not going to change. Demand should pick up as soon as containment ends. We should ...

DEMAND ANALYSIS

2.1 Demand for spirits and rum in France

Overview of spirits consumption in France

Consumption of spirits has fallen sharply in recent years. In ** years, per capita consumption of pure alcohol has fallen from *.** liters per person in **** to *.** liters per person in ****, under the influence of public policies to raise awareness of the dangers of alcohol. Consumers of ...

2.2 Demand drivers

The spirits segment is increasingly attracting French consumers. According to the latest SOWINE and Dynata barometer, **% of those surveyed are interested in this segment, an **% increase over ****. **% of French people believe they consume rum, putting it in first place ahead of whisky and liqueurs. Its popularity is up *% on ****. Spirits selection ...

2.3 France's favourite rum brands

The graph below shows the ranking of rum brands preferred by the French. Percentages correspond to the proportion of respondents who say they like each brand of rum.

Negrita is the favorite rum brand of the French, with **.*% of respondents saying they like it.

Preferred rum brands by gender France, ****, in Source: ...

2.4 Cocktail consumption on the rise

Cocktail consumption is booming and logically driving consumption of the alcohols that make them up, particularly away from home: in fact, in ****, **% of French people consumed cocktails only away from home, and **% consumed them both at home and away from home.

Place of consumption of cocktails France, ****, in Source: ****

Nevertheless, the ...

2.5 Demand in the French West Indies

Stable rum consumption

Consumption of traditional rum in Martinique is a stable element within the alcohol consumption picture. Rum accounts for by far the largest share of consumption (***).

Breakdown of alcohol consumption Martinique, **** - ****, in LAP : Source: ****

In Guadeloupe, consumption of hard alcohol is significantly higher than in mainland France. Where ...

MARKET STRUCTURE

3.1 Industry forces and organization

Numerous players are involved throughout the chain before the rum reaches the end consumer:

The first players in this chain are the farmers and agricultural cooperatives, as well as the distillers (***); Eaux-de-vie and spirits manufacturers then carry out additional production stages; Intermediaries (***) provide the link between manufacturers and distributors; Three types ...

3.2 Production concentrated overseas

The production process

A distinction can generally be made between rums made from the distillation of cane juice (***) and those made from molasses. Obtained by crushing sugar cane, cane juice deteriorates rapidly: the producer must ferment it very quickly, then distill it. Molasses, on the other hand, is a thick, viscous ...

3.3 Distribution

We can observe that the distribution of alcoholic beverages takes place mainly in physical areas (***).

According to Spiritueux Magazine, in ****, rum accounted for **.*% of the value of spirits sales in supermarkets and hypermarkets (***).

A total of **.* million liters of rum were sold in supermarkets, compared with *.* million litres in cafés, ...

3.4 Increasing competition

The rum segment is highly competitive.

Leaders are keeping up a steady pace of innovation to maintain their market share, which is leading to ever-increasing competition.

for example, Captain Morgan, the industry leader in spiced rums, is attacking the white rum segment with Captain Morgan White, to compete with Bacardi in ...

OFFER ANALYSIS

4.1 Types of rums on offer

Rums can be segmented in different ways: industrial rums vs. agricultural rums age imported rums vs. rums specific to DROMs These rums can be used for a variety of purposes, from disgusting drinks to cocktail bases Types of rums Characteristics Examples of brands White rums White rum is light in color, ...

4.2 A more premium and environmentally-friendly rum offering

The premiumization of rums

As experience grows, a minority but not insignificant proportion of consumers aspire to more premium, even tasting, products. "Standards represent **% of the total market by value, but are losing market share to superpremium and ultrapremium," notes Frédéric Le Garff of Havana Club. According to British ...

4.3 Rising prices

Average rum price trend France, ****-*****, euros Source: ****

We can see that the price per bottle is growing steadily over the ****-**** period, rising from €**.* to €**.**.

The craze for the product and the quest for higher-quality consumption have logically led to a substantial rise in prices, amounting to **.**% over the ...

4.4 Martinique rum

An essential market

While Martinique's sugar cane production is a major source of income, rum production is also an important part of the island's agri-food economy. This sector alone accounts for **% of the added value of the island's food industry and *% of export earnings (***). In ****, total production reached ***,*** hlAP, or around ...

4.5 Old rum price range

Bottled aged rums

The price of a bottle of aged rum varies widely, depending on the brand, the year of production, the degree of alcohol present and the length of ageing. You'll find bottles on the market for as little as €**, rising to almost €*,*** for the rarest and most upmarket. Here's ...

REGULATIONS

5.1 Current regulations

As we saw earlier, the specific taxation applied to overseas territories has led to the specificity of the French market. However, aligning the tax system with that of mainland France has long been a legislative snake for public health reasons. According to MP Ericka Bareigts, alcohol is the cause of *.*% of ...

5.2 Future regulations

In the interests of tax fairness and the gradual elimination of derogatory regimes on a European scale, on Wednesday November **, ****, the Senate adopted a government amendment linked to the Social Security budget project spreading over * years and which will lead to aligning the taxation of spiritsparticularly rum, with metropolitan France[***].

The ...

POSITIONING THE PLAYERS

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Reviews (1)

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The rum market - France

Publicado en 19/05/2023 by Joël Cocote Pinel Fereol

Good choice of themes and rigorous analysis.

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