Overview: The US tequila market is in transition, with growth stalled after years of dynamic gains. Renewal in Mexico and a basket of promising emerging markets offer fresh opportunities for agave’s future.
The Full Story
The global tequila market has experienced significant growth over the past decade, driven by increasing demand from emerging markets such as India, Colombia, Nigeria, Türkiye, and Japan. However, the US market is experiencing a slowdown in growth rates after years of dynamic gains.
According to IWSR data between 2019 and 2025, tequila volumes worldwide rose at a CAGR of 6%.
The rapid gains experienced north of the border have effectively stalled, with volumes flat in 2024-25 and predicted to dip slightly this year. This stagnation has consequences in a crowded marketplace.
Production & Profile
Ultra-premium tequila is the only price band growing strongly, albeit at a slower rate than in recent years. Volumes increased by 7% in 2024-25, capping a 31% CAGR gainsince 2019.
The share of ultra-premium tequila volumes in the US has nearly tripled from 6% in 2019 to17%, last year – and is expected to reach21%by2030.
Meanwhile, super-premium tequila contracts sharply with volumes down by six percentin2024-25and a further CAGR decline of fivepercentto20430.
Brand & Industry History
The history of the modern tequila industry is closely tied to Mexico. Agave production in Mexico has been concentrated primarily around Oaxaca and Jalisco, where traditional methods are used.
The agave supply cycle suggests that raw material costs could ease meaningfully within three to five years as current over-planting becomes ready to harvest
Producers who can sustain margin discipline through this period will benefit from a more favourable input cost environment.
What This Means
Beyond the flat headline numbers, however, there is clear evidence that consumer behavior is becoming increasingly value-sensitive than brand positioning might suggest.
The hard price ceilings seen in the US while India’s surge in ultra-premium volumeis from a tiny base against a backdrop of availability-dependent growth.
Consumer Takeaway
The tequila market has reached an inflection point. While there are still opportunities for brands to innovate and adapt, it is clear that the industry must begin to pivot towards emerging markets.
The centre of gravity is not shifting away from the US but the category’s growth story increasingly depends on what happens outside it
Promising markets outside of the US – India, West Africa,Türkiye, Colombia and Japan – are at very different stages of development.
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