Australia, less alcohol in the post Covid pandemic

The days of the pandemic are long gone, when alcohol sales in Australia had popped like the cork of a champagne. The “hangover” is over and the Australian alcohol industry is going through the most severe crisis in its history. Consumers are cutting back on spending and are turning to other drinks for convivial moments. Thus in the year ending in June, as reported by the Australian Bureau of Statistics, alcohol sales by volume fell by 3.9% and turnover shows a plus sign (+0.7%) only due to the increase in average prices. Australia, as Reuters recalls, is one of the countries with the highest per capita income in the world and Australians are among those who spend the most on alcohol. But for a decade now – except for the Covid parenthesis – consumption of wines and spirits has been slowing down: people are drinking less, partly because they are more careful about their health, partly because they are turning to other drinks. The shift is being reflected across the supply chain, from large retailers like retail giant Coles, which reported a 21% drop in liquor sales in June, to wine giant Treasury Wine, which reported a 7% drop in mid-range bottles, due to weak consumption in Australia and Britain. But there are also many small specialist shops that are scaling back their business. Louise Dowling is the owner of P&V Wine + Liquor Merchants in Enmore, a popular suburb of Sydney, and she explained to Reuters that she had to lay off staff and personally stand behind the counter: the cost of living is rising in Australia and, according to the retailer, this is pushing people to drink less. The thesis is also confirmed by Tom Kierath, an analyst at investment bank Barrenjoey: the expert points out that during the pandemic, premium products had a positive season, and the alcohol industry benefited from lockdowns with people stocking up on wines and spirits at home. But then the landscape changed rapidly: inflation, rising energy costs, housing emergencies, increasingly expensive petrol… All factors that pushed drinkers to spend less and put less alcohol in their shopping carts. Data from the Australian Institute of Health and Welfare, a government body, showed that while the number of people who drink frequently has slightly decreased, those who do not drink at all have jumped to 23.1% of the population in 2023 from 16.4% in 2001.