Sector News

Craft rum market poised to reach $2.5B by 2031

September 2, 2023
Food & Drink

Rum, a staple of tropical cocktails like the mai tai and piña colada, is seeing growing interest in the U.S., leading new players to enter the space. The Transparency Market Research data signals a greater desire for different kinds of rum among drinkers of the sugarcane molasses-based alcoholic beverage.

The data indicates a generational divide among rum drinkers. While older drinkers favor mass-produced rum, such as Captain Morgan and Bacardi, millennial drinkers prefer handcrafted and flavored options, the report said.

There are hundreds of craft rum distilleries in the U.S. with unique tastes and finishes.

One example of an artisan brand is Pittsburgh-based Maggie’s Farm which claims it produces its beverages with a higher concentration of rum oils and flavor compounds and has won numerous awards, including the Best-of-Class Rum from the American Distilling Institute this year.

The Transparency Market Research report pointed to Indiana-based Cardinal Spirits’ Blackstrap Rum, which has a fruity flavor due to being toasted in barrels used for brandy production, as a key player since its debut in 2022.

As makers of rum have reason to be optimistic about the space, makers of other kinds of alcohol are joining in on the hype. Many distilleries who produce beer, whiskey and gin also began producing rum in recent years due to its increasing popularity, industry trade publication the Rum Reader reported in 2019.

Craft alcohol brings the risk of oversaturation if there are too many players in the space and brands unwilling to meet shifting consumer tastes.

Last month, the oldest craft brewery in the U.S., San Francisco-based Anchor Brewing, shuttered its operations after 127 years. Analysts attributed to too many players in the space, and shifting market demands.

by Chris Casey


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