Food and Beverage - Craft Rum Market

Market Snapshot

CAGR:5.50%

2021

2028

Source: Reports and data

Study Period	2018-2028
Base Year	2019
CAGR	5.50%

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Global Craft Rum Market: Overview

The global craft rum market size was USD 1.26 billion in 2020 and is expected to register a CAGR of 5.5% during the forecast period. Steady market revenue growth can be attributed to increasing demand for craft spirits, especially among millennial consumers, reopening of pubs worldwide, growing popularity of craft rum and spirits through social media platforms, and increasing number of craft distilleries in countries across the globe.

 

Increasing indulgence in parties and music festivals, rising availability of craft rum at restaurants, bars, and pubs, changing urban lifestyles, and rising disposable income of consumers are other factors contribution significantly to global craft rum market revenue growth. Craft rum manufacturers have been experimenting with numerous Flavors and ingredients such as buttery caramel, vanilla pods, smoky licorice, sugary syrups, and tropical fruits, to make their products more appealing to consumers. Moreover, surging demand for premium alcoholic beverages and rising consumption of high-end rum cocktails are expected to further drive market growth. Growing awareness about health benefits of rum such as antimicrobial properties, cancer prevention, and cardiovascular benefits, is expected to further bolster global market growth.

Rum is a widely consumed alcoholic beverage that is made by fermentation and distillation of sugarcane molasses or juice. Rum is available in a variety of grades including light rum, dark rum, gold rum, white rum, black rum, vintage rum, and premium aged rum. Some varieties of rum also have culinary applications. Some American and Caribbean countries as well as Asian countries such as India and the Philippines are leading producers of rum. Premiumization of rum over the past decade has inspired manufacturers to innovate and introduce independently owned craft rum brands made with the perfect blend of art and science. Like all craft spirits, craft rum is usually made using ingredients that are handpicked and locally sourced. Innovation is the hallmark of craft rum; brewers and distilleries are increasingly inclined towards historic styles and unique flavor combinations and twists when it comes to craft rum and other craft spirits. Spiced rum is one of the most popular choices of craft liquor fans, given the aromatic flavor and reinvigorating taste of the beverage. Cinnamon, nutmeg, ginger, rosemary, vanilla, pepper, clove, and coconut are among the most commonly used ingredients for flavoring of craft rum.

Global Craft Rum Market: Dynamics
Drivers: Rising popularity of craft rum among younger consumers is a key factor promoting market growth

Increasing demand for craft spirits, including craft rum, among millennials and generation Z (zoomers), growing footfalls and rising demand in pubs and discos, and increasing preference among the youth for premium alcoholic drinks are key factors expected to continue to support revenue growth of the global craft rum market going ahead. Currently, consumption of high-end alcoholic beverages is associated with high socioeconomic status, which is yet another factor spurring market growth.  

Restraints: Several side-effects associated with consumption of alcohol are expected to hamper market growth

Global craft rum market growth is significantly challenged by certain disadvantages of rum consumption. Rum contains higher alcoholic concentration than many other spirits, making it harmful for liver health if consumed in excessive amounts. Excessive intake of rum is detrimental for the cells and tissues and could lead to severe health consequences. Changing lifestyle and shift towards healthy living following a period of drinking by a sizable consumers base and rising focus on health issues owing to early onset of aging are other factors expected to restrain market growth to a certain extent going ahead.

Global Craft Rum Market: Product Type Outlook

Based on product type, the global craft rum market is segmented into spiced rum, white rum, coconut rum, coffee rum, cranberry rum, and others. The spiced rum segment is projected to lead in terms of revenue share among the other type segments throughout the forecast period. Spiced rum is infused with various flavors of fruit extracts and spices, including ginger, cinnamon, vanilla, clove, mint, citrus fruits, coconut, pineapple, and mango, which imparts a unique taste. Rising popularity of spiced rum due to its distinctive flavors and health benefits, rising demand for premium spiced rum, and new product launches have propelled revenue growth of this segment, and the trend is expected to continue going ahead.

Global Craft Rum Market: Distribution Channel Outlook

The global craft rum market comprises is segmented into hotels & restaurants, bars & pubs, cafes, liquor shops, retail stores, online channels, and others. The bars & pubs segment among the distribution channel segments is expected to lead in terms of revenue share over the forecast period. Increasing availability of craft rum and expensive alcoholic beverages across bars & pubs, rapidly increasing trend of home parties with small groups of attendees due to the pandemic, increasing number of high-end bars and restaurants, and increasing disposable income of consumers are some key factors fueling this segment’s revenue growth. 

Global Craft Rum Market: Regional Outlook

Global craft rum market region-wise segmentation includes North America, Europe, Asia Pacific, Latin America, and the Middle East & Africa. The craft rum market in North America is expected to lead among other regional market, with highest revenue share. High revenue growth of this market is supported by rising consumption of craft spirits, especially among the younger generation, new product launches, increasing number of craft breweries and distilleries, and growing demand for premium alcoholic beverages. The Asia Pacific craft rum market registered the  fastest revenue growth rate of 5.8% in 2020, driven by rising pub culture, increasing number of restaurants and bars, rise in social gatherings and private parties, and rising income levels of consumers in countries in the region.

Companies Profiled in the Report:

Major companies operating in the global craft rum market include Wicked Dolphin Rum, Drum Circle Distilling, Drum & Black, Burning Barn, Bacardi Limited, Charles Merser & Co., Domaines Ellam, Arizona Craft Beverage, Rockstar Spirits Ltd., Lyon Distilling Company, and Copalli.

Key Developments:

• In 2020, Bacardi rolled out the new Bacardi Real Rum Cocktails crafted with natural fruit flavors and exotic ingredients. The latest collection comprises three distinctive flavors, including limon & lemonade, lime & soda, and rum punch infused with Bacardi white rum.
• In February 2021, Stilldistilling Spirits, which is an emerging Goa-based rum start-up, introduced the new craft rum called Maka Zai, which is a unique blend of gold and white rum topped with the refreshing taste of vanilla, Honey, cinnamon, and sugarcane.

Global Craft Rum Market Segmentation:

For the purpose of this report, the global craft rum market is segmented based on the product type, price range, distribution channel, and region: