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Why tequila is the spirit of 2021

You know something has hit peak cool when a Kardashian gets involved. Kendall Jenner has become the latest celebrity to launch her own tequila brand, called 818. The 25-year-old joins the likes of George Clooney (Casamigos), Dwayne ‘The Rock’ Johnson (Teremana), Bryan Cranston (Dos Hombres), Rita Ora (Próspero Tequila) and Nick Jonas (Villa One) in the agave-based spirits realm.

Jenner wrote in the Instagram caption last week: “For almost four years I’ve been on a journey to create the best tasting Tequila. After dozens of blind taste tests, trips to our distillery, entering into world tasting competitions anonymously and WINNING (🥳) ..3.5 years later I think we’ve done it!

“This is all we’ve been drinking for the last year and I can’t wait for everyone else to get their hands on this to enjoy it as much as we do! @drinks818 coming soon 🥃🤤.”

But it’s not just celebrities getting into the agave game. All the big drinks companies are reporting tequila as the shining light in their sales figures.

So what’s the big attraction? It seems the US can’t get enough tequila. Texas-based Tito’s Handmade Vodka became the best-selling spirit in the US in 2019, knocking Smirnoff off the top spot for the first time in more than a decade.

Jose Cuervo tequila sales up 62%

Tequila sales surged 46% globally in 2020 despite being in the shadow of a pandemic. At-home mixologists with more disposable income due to less international travelling embraced the spirit as being much more than just a cheap shot and started exploring more premium options.

The Rock’s Teremana Tequila is a case in point.

“It’s official – we’ve made history,” he wrote on Instagram recently. “@teremana has become the biggest launch in the history of the spirits business. Of any spirit, ever. In less than one year we’re on track to sell 300,000 cases and ship roughly 400,000 cases of Teremana in our first year of business. (for context Clooney sold his Casamigos tequila brand at roughly 175,000 cases).”

Patron’s Marketing Manager Stephanie Sarantakos told Business Insider Australia that tequila is the fastest-growing spirit in the US and third-fastest in Australia, with tequila cocktail recipes in Australia having “some of the highest search intensity worldwide”.

“As consumers become more educated, it will also open up new occasions and drinks with tequila. For example, The Paloma — Patron Reposado & Grapefruit soda — has been gaining major awareness in the US lately due to its simplicity and ease of making, and we’re seeing a similar trend flow through our market.”

Pernod Ricard – which has the Altos and Avion brands – declared a 60% growth in tequila sales in 2020. Diageo’s US sales of the spirit surged 80% in the last six months of 2020, with sales of one brand, Casamigos (originally launched by George Clooney), more than doubling. 

And Bob Kunze-Concewitz, Chief Executive Officer at Campari, was bullish about its tequila brand, Espolòn, during an analyst call last week, with the brand’s sales up 29.9% in 2020.

“I think we’re very, very close to upgrading the brand into another cluster,” he said. “It’s a great brand. It’s resonating across all consumer segments in whichever country we go into at this moment in time we’re trying to reserve as much volume possible for the U.S. which is our number 1 priority. That might slow down some international rollouts.

“But there is no question that this is going to become quite a meaningful brand for us. And that we believe there’s an opportunity for tequila outside of the US, which doesn’t necessarily have to grow through the Margarita. Actually what we’re really pushing internationally is the Paloma [above], which is Espolòn Blanco with fruit juice, and that’s resonating very, very strongly.”

The only problem is … there’s an agave shortage

There may be a growing thirst across Australia and the world for top-quality tequila, but there’s also a global shortage of its main ingredient, agave.

Agave tequilana, the blue-tinged, spiky-leaved succulent used to make the alcoholic drink, is labour intensive to harvest and takes five to 12 years to reach maturity. Mexican producers weren’t ready for the booming demand for their national spirit.

“We are dealing with agave shortages,” says Federico “Fede” Vaughan, the co-founder of Codigo 1530 tequila, told Forbes. “It’s just temporary and should be solved in the next few years. But there is a huge shortage: agave prices are at an all time high because there’s no inventory and the agave planting was not well planned.”

Last year, more than 250,000 plants were planted on a farm south of Bowen, in north Queensland, to supply Melbourne-based distillery Top Shelf International. There will be 400,000 in the ground by June this year, and one million in four years. They will eventually be turned into an agave spirit brand called Ozcal (only spirits made in Mexico can carry the “tequila” name).

“Whisky is our core, gin and vodka is our high growth and agave is our X factor,” owner Drew Fairchild told The Australian.

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