The American Craft Spirits Association (ACSA) and Park Street recently presented highlights from the 2023 Craft Spirits Data Project (CSDP) at its Annual Craft Spirits Economic Briefing. Margie A.S. Lehrman (CEO, ACSA), Gina Holman (president, ACSA and founding partner, J. Carver Distillery) and Emily Pennington (senior manager, Park Street) shared key sales data and insights from the 2022 calendar year.

The CSDP, introduced in 2016, is a first-of-its-kind research initiative that aims to provide a solid and reliable fact base for evaluating performance and trends in the U.S. craft spirits industry. The CSDP, which seeks to quantify the number, size and impact of craft spirits producers in the U.S., is an effort led by ACSA and Park Street.

Key findings and highlights revealed during the briefing include the following:

  • U.S. craft spirits market volume reached 14 million nine-liter cases in retail sales, growing at an annual rate of 6.1%. In value terms, the market reached $7.9 billion in sales, growing at an annual rate of 5.3%.

While there was still growth in 2022, it has slowed considerably from 2021, where craft spirits volume grew by 10.4% and value by 12.2%. U.S. craft spirits market share of total U.S. spirits maintained a 4.9% share in volume and increased value share to 7.7% in 2022, up from 7.5% in 2021.

  • The number of active craft distillers in the U.S. grew by 2.4% over the last year to 2,753 as of August 2023. Similarly, growth slowed from the year prior, which reported an increase by 17.4%.

Active craft distillers are defined as licensed U.S. distilled spirits producers that removed 750,000 proof gallons (or 394,317 9L cases) or less from bond, market themselves as craft, are not openly controlled by a large supplier and have no proven violation of the ACSA Code of Ethics.

  • Despite strong economic challenges, craft producers have consistently found value in reinvesting in their businesses. The total amount invested in the U.S. craft spirits segment increased by 6.5% year-over-year to $880 million.

Employment numbers within the U.S. craft market also continued to increase post-pandemic, with 27,368 full-time domestic employees.

Home states still represent a critical sales opportunity. Craft spirits sales remain almost evenly split between the home state (47.4%) and other states (52.6%) in 2022.

  • While export growth was slower (up by 58% in 2021), they provided a continued and important runway for growth in 2022, up by 4.3% to 171,000 9L cases and surpassing pre-pandemic heights of 155,000 9L cases in 2019.

However, the category is still recovering from the long-term export implications from tariffs and have not reached pre-tariff levels seen in 2017 at 566,000 9L cases.

The American South has the highest concentration of craft distilleries, surpassing the West which has typically had higher numbers. Some states are “craftier” than others, with California, New York, Texas, Pennsylvania and Washington leading the pack.

Texas remains the third most concentrated state, having taken the fourth slot in 2020. Washington fell into the fifth slot, having been third in 2020.

The top five states by number of craft distilleries are:

  1. California (245)
  2. New York (210)
  3. Texas (163)
  4. Pennsylvania (117)
  5. Washington (156)

They make up 32.4% of the U.S. craft distiller universe.

The next five states – Colorado (114), Michigan (114), North Carolina (104), Florida (91) and Oregon (86) – comprise an additional 18.5% of the market. The remaining states represent 49.1% of the market.

View the full 2023 Craft Spirits Data Project here.