It’s been a difficult year for the spirits industry. Between the rise of anti-alcohol sentiment, inflation, destocking, struggles with the on-premise, and a plain old correction after the boom years of the pandemic, the mood has been tense. Big corporations are scaling back and small ones are feeling the squeeze. Add in the unnerving return of tariffs and trade wars, and it’s easy to eye the year ahead with some trepidation.
Still, we think there’s plenty of reason to keep a level head. Spirits continue to lead beverage alcohol in market share, and while sales value was down 1.1% in 2024, volume was actually up by the same percentage. That means 2024 was the first year that premiumization wasn’t a major industry driver since the end of the Great Recession. Anecdotally, we’ve heard many of our members had great years. Some had their best year ever. So how can craft producers be thriving when there’s so much doom-and-gloom in the wider industry?
Tough times mean opportunities, and few are better poised to take advantage than scrappy, nimble craft distillers. Our members’ lively tasting rooms and outstanding products are tapping into a deep hunger for ways to connect in real life, sans apps and screens. As we head into a fresh year, here’s how we’re thinking about what’s to come — and how ADI can help you make it your best year yet.
Neo-Prohibitionism
Anti-alcohol sentiment ramped up in the past year. Two different government-led meta-analyses gave confusing and conflicting recommendations. In December 2024 the National Academies of Sciences, Engineering, and Medicine found that “moderate alcohol consumption is associated with lower all-cause mortality.” Then a January 2025 meta-study from the Interagency Coordinating Committee on the Prevention of Underage Drinking found mixed data, with moderate alcohol use contributing to cancer risk but reducing stroke risk for both men and women.
Heavy drinking is inarguably bad for health, and the urge to drink more mindfully is one craft distillers should welcome. Craft producers offer consumers a very different value proposition than high-volume, low-quality spirits: If you choose to drink, you should be able to choose products that are beautifully and thoughtfully made, and whose purchase supports small businesses that make a positive impact in your community.
Drinking less but drinking better is a trend craft distillers can benefit from, especially those able to welcome visitors and create exciting venues for social interaction whether everyone in a party chooses to drink alcohol or not. With loneliness rampant, it’s worth remembering bars and restaurants are a cornerstone of human social infrastructure and have been for a very, very long time. They’re not going anywhere.
Trade and Tariffs
ADI shares industry-wide concerns about the return of tariffs and trade disruptions, which have the potential to harm craft producers on multiple levels. Tariffs could block members’ ability to export and lead to high prices and shortages on essential materials like glass and corrugate. Even the threat of tariffs injects additional uncertainty and instability during an already turbulent time. ADI is closely monitoring the trade situation and will engage alongside industry partners if the need arises.
Opportunities in Tough Times
Reduced volumes in major categories like American whiskey mean there are deals out there for the first time in almost a decade. If you’ve been put off by the cost of aged whiskey, you might try dipping back into the market. We’re seeing listings for two-, three-, or even five-year-old casks for a fraction of the price they were just a couple of years ago. Distillery businesses and production facilities are also for sale, giving new entrants the chance to bypass the sometimes excruciating construction process and get a turnkey start.
Layoffs and closures also mean lots of top-tier distillery talent is also available and looking for work. This isn’t just for the first time in a long time, it’s pretty much for the first time ever in the craft spirits industry, which historically operated by hiring interested but inexperienced people and then training them on the job. Now, openings are getting applications from people who already have the skills they need to succeed.
ADI Stands Alongside Craft Distillers
As we navigate these “interesting” times, ADI is more committed than ever to supporting our members in their journeys. In 2024, we enhanced outreach, webinars, and workshops to bring you deeper insights and expert perspectives on industry challenges and opportunities. We’re also fostering community with stories and inspiration in the pages of this magazine and on our videocast, Voices of Distilling. Members get access to our entire library of video content from past conferences and workshops — a treasure trove of information from the industry’s most knowledgeable and influential professionals.
Most importantly, we’re excited to see you all in person at ADI 2025 in San Antonio, Texas, this August. Texas is now one of the top three states for craft distilleries in the nation, and San Antonio is steeped in culture, history, and culinary greatness. It will be another amazing year of the largest gathering of craft spirits producers and suppliers in the industry, including a keynote address from Alexandre Gabriel, workshops and breakout sessions for every interest, and the chance to connect, network, and make some more of those face-to-face real-life connections we could all use more of.
The craft distilling industry has weathered storms before. It wasn’t long ago that many states’ laws didn’t allow craft distilling at all. We mobilized to change legislation — state by state — to make this industry possible. Tough times have come and gone, but people’s love of a great drink has never vanished.
So yes, it’s choppy sailing out there. But we’re still betting on craft spirits producers. With ADI by your side, we’ll navigate these challenges and emerge stronger than ever. Thanks for being part of the ADI family, and cheers to the possibilities ahead.
Erik Owens
