Welcome to Thoughts on the Market.
I'm Sarah Simon, head of the European Consumer Staples team.
Today's topic, is America sobering up?
Recent trends point to a national decline in alcohol use.
It's Wednesday, April 23rd at 2pm in London.
Picture this.
It's Friday night and you're at a bar with friends.
The drinks menu offers many options.
A cold beer or a glass of wine, sure, but how about a phony Negroni?
And your friends not approvingly.
This isn't just a passing trend.
We believe it's a structural shift that's set to reshape the beverage industry.
Overall alcohol consumption in volume terms has been relatively flat over the last decade in the US,
with spirits growing mid-single digits in value terms and beer growing low single digits.
But both categories are currently declining.
The big debate is whether it's cyclical or structural.
We acknowledge that the consumer is under pressure right now,
but we equally see long-term structural pressures that are starting to play out.
There are three key factors behind this trend.
Increased moderation by younger drinkers, an ageing population,