Analyst says growth in spirits may be leveling off

Investment bank, Merrill Lynch has stated in a recent analysis that the strong growth in the spirits market has been built on short-terms fashions and trends rather than a longer term structural shift in demand.

Spirits have seen strong growth in recent years, especially among young drinkers, and the growth has stolen market share from the beer category. Merrill Lynch said the growth stemmed primarily from changes in fashion. "It's a cyclical thing, not a structural shift," said Merrill Lynch's beverage analyst, David Tovar.

Recent data from the National Alcohol Beverage Control Association also seems to indicate that growth in spirits is slowing.

This could portend good news for the major brewers and importers who have had market share diminish in the last year due, in part to a surging popularity of trendy mixed drinks and distilled spirits.