As a Brazilian, I have tried where possible to play my part in increasing the diversity of whisky (in particular Scotch whisky) available to others in South America, either through exporting directly from Scotland or by working with national importers. Recently, I have been asked to contribute to an article on the topic of the Spirits market in South America and here I’d like to share my views…
What’s your impression of the overall spirits market in South America at the moment? Are there any other countries performing well when it comes to spirits at the moment?
Very positive overall especially for the whisky category. Some examples include Brazil’s whisky scene, which continues to mature beyond the dominance of Scotch whisky, with consumers widening their repertoire to include Brazilian single malt whiskies and whiskies from other regions of the world, such as Bourbon which has grown significantly over the last few years. Uruguay’s continued passion for whisky is growing further with festivals supporting the category and consumer education growing in the past 12 months. Chile has a strong cocktail scene, where consumers can enjoy its national spirit pisco, but with whisky also a popular choice, driven by premiumisation and cocktails trends. Even in Argentina, which is dominated by wine and beer, and where the recent economic volatility limited the variety of imported whiskies, has experienced a positive outcome with the local distilling of quality domestic whisky, as captured in the recently released ‘Whisky Argentino Anuario 2026’ book by La Sociedad Whisky of Argentina.
Which spirits categories are performing well, and why?
Brazil is one of the largest markets in the region for whisky, with the vast majority of whisky consumed being Scotch whisky and led by brands such as Johnnie Walker and other blends. Despite a recent downturn (2017-2020) due to recession and high taxes, the market has since been in growth with rising premiumisation and a vibrant cocktail scene. Expectation is that there will be a slight volume decline in the near future, especially with younger consumers switching to beer and RTDs/ cocktails, however value will continue to grow as Brazilians trade up to higher priced blends and single malt whiskies as long as the economy remains strong.
There is also a growing interest in Domestic whisky production, benefitting from competitive retail prices, as imported whiskies face steep taxes, and the increased quality of the single malt whiskies being released into the market. Producers such as Union Distillery and Lamas Destilaria lead this new wave of Brazilian single malt whisky producers, which is further enhanced by developments such as the launch of Lunatic Asylum, the 1st independent bottler of Brazilian whisky.
Are RTDs on the rise? If so, what’s driving that?
Yes, RTDs are growing linked to the increased interest in cocktails generally across the region, supported by an increase in drinking occasions at home but also due to younger consumers looking for lower ABV alternatives to drink. More unexpectedly is the fact that in some countries, RTDs have perhaps benefited from regulations such as those imposed to limit drink driving offences, in countries such as Brazil. Overall, this has led to an increase in the product offer available domestically and also on the consumption of RTDs.
Do the opportunities lie more in the on-trade or the off-trade at the moment?
For the whisky category, off-trade in Brazil is the most important channel and it represents around 70% of total value. Additionally, there has been a recent outbreak of methanol poisoning in the state of Sao Paulo, which has led to suspected cases in the hundreds and unfortunately some fatalities. The tainted alcohol adulterated with methanol seems to have been present primarily in white spirits (gin, vodka) in the on trade with a number of bars and restaurants temporarily suspending sales of distilled spirits and removing it from their menus. The Brazilian public may respond by looking to source their spirits, at least in the short term from trusted off trade and eCommerce sources, such as Single Malt Brasil.
What are the main challenges in the region at the moment?
The main structural challenges in the region are the level of high taxation, the high logistic cost to move stock and the red tape that spirits brands have to navigate through to enter the domestic markets in South America. This creates a barrier to entry and increases the cost to access the market, disproportionately benefitting the larger producers, such as Diageo and Pernod Ricard, and reducing the amount of choice available to consumers in the region compared to other parts of the world.
This is also one of the reasons for consumers to chase duty free options (such as airports and border shops) where possible to access spirits, despite any restrictions on the spend set by different governments that may be in place, as it allows them to access a more diverse portfolio of brands, at a better value compared to domestic markets.
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