Liquor consumption set to shrink in the next decade, and that is a bigger commercial warning than another soft quarter from a drinks giant. The IWSR forecast points to a market where volume declines continue even as population grows and some emerging markets expand.
For FMCG professionals, the message is blunt: category growth will not come from waiting for the old drinking cycle to return. It will come from sharper portfolio mix, better occasion targeting and a faster shift into formats consumers still want.
What liquor consumption set to shrink means for FMCG
The forecast matters because alcohol has long acted like a slow-moving but dependable engine for retailers, distributors and suppliers. When volume stalls, every link in the chain feels it, from barrel and can planning to shelf allocation and promotional spend.
IWSR says its first 10-year forecast covers 160 markets and does not expect global alcohol consumption volumes to stop falling until after 2031. That is not a short-lived wobble. It signals a structural reset in how people drink, what they buy and how often they buy it.
The Australian angle is clear even if the report is global. Local drinks players, bottle shops and grocery liquor teams are all operating in a market where premiumisation alone can no longer offset every volume loss.
IWSR’s global alcohol forecast and the markets changing fastest
IWSR said global alcohol consumption is set to fall over the next decade despite population growth and rising demand in India, which it expects to become the world’s biggest drinks market after China. The research firm also said sales across the sector have contracted since 2023 and stock market valuations have shrunk.
It linked the shift to cost-of-living pressure, changing consumer habits, health concerns and the rise of weight-loss drugs, which may affect drinking rates. Marten Lodewijks, IWSR president and managing director, said drinks companies need to adapt rather than rely on past successes.
The forecast also changes the map of where growth comes from. Traditional heavyweights such as China and the United States are expected to lose more than 18 per cent of alcohol servings consumed by 2035, while India rises 38 per cent over the next 10 years.
| Market | IWSR outlook to 2035 | Commercial signal |
|---|---|---|
| Global alcohol consumption | 1 per cent below last year by 2035 | Volumes keep drifting lower even as legal-age drinkers rise |
| China and United States | More than 18 per cent drop in servings | The biggest drinking markets lose more than they gain |
| India | 38 per cent increase over 10 years | Growth shifts toward an emerging scale market |
| Mexico | 13 per cent rise | Selective growth outside the legacy core |
| Vietnam | 15 per cent rise | Opportunity moves into smaller but faster markets |
| Colombia | 26 per cent rise | Latin America keeps producing pockets of demand |
Spirits, beer and wine are all forecast to lose volume by 2035, while newer drink types such as canned cocktails take share. I see that as a sign that the fight is no longer just about brand loyalty. It is about format, convenience and how often a product can fit into a lower-commitment drinking occasion.
How the shift will show up on shelf and in the warehouse
IWSR said global annual per capita litres of pure alcohol will fall by the equivalent of two bottles of spirits or a case of wine per person per year by 2035. That is a useful way to think about the impact because it turns a macro trend into a planning problem for buyers and supply teams.
For retailers, the pressure lands in merchandising and ranging. Lower volume can mean fewer turns for mainstream beer and wine, while growth categories ask for more chilled space, more mixed-pack planning and tighter forecasting.
For suppliers, the challenge is margin protection. A market can still look healthy in revenue terms if pricing holds, but that does not solve under-filled production lines or weaker freight efficiency.
What liquor consumption set to shrink does not change
This forecast does not mean alcohol stops mattering. It does not erase premium spirits, craft beer, Australian wine or the role of liquor in supermarket-adjacent baskets and destination shopping.
It also does not tell us which brands will win shelf space in each market. Local regulation, retail power and consumer taste still vary sharply by country, and that will keep the picture uneven.
India is likely to benefit first, alongside markets such as Mexico, Vietnam and Colombia. Suppliers with exposure to those regions may see growth where mature markets flatten, while legacy markets like the United States, the United Kingdom and Germany will need sharper mix management and less reliance on old volume habits.
The bigger picture for alcohol categories and FMCG planners
I think the most important takeaway is that liquor is moving deeper into the same pattern already hitting parts of FMCG: slower volume, more fragmentation and heavier dependence on occasions rather than broad consumption. Health concerns, weight-loss drugs and moderation habits are not side stories anymore. They are now central to category planning.
That means the winners will be the operators who treat this as a portfolio problem, not a branding exercise. The next decade rewards faster innovation in lower- and no-alcohol lines, better regional targeting and more disciplined supply chain planning.
Liquor consumption set to shrink, so the next advantage will go to the brands and retailers that build for lower volumes now instead of defending yesterday’s demand curve.
If you manage a drinks range, a liquor retail plan or a supplier portfolio, I would be acting on this forecast now rather than waiting for the downturn to show up in your own numbers.