Eighty-Two Per Cent of Agave Spirits Go to a Market That Just Started Buying Less

One market, and it has turned

About 82 per cent of Mexico’s certified agave spirits exports go to the United States — roughly 335 million of the 408 million litres the CRT certified for export in 2025. There is no other spirits category in the world with that level of single-market concentration and that size. Scotch’s largest market is a fraction of its book; Cognac’s dependence on the US and China is the industry’s standing cautionary tale at a lower share.

In 2025 that market stopped growing. The Distilled Spirits Council’s annual economic briefing put US spirits supplier revenue at USD 36.4 billion, down 2.2 per cent, on volume up 1.9 per cent to 318.1 million nine-litre cases — and every point of that volume growth came from pre-mixed cocktails and spirits RTDs, which rose 16.4 per cent to USD 3.8 billion. Strip out RTDs and US spirits revenue fell USD 1.4 billion, 4 per cent, and volume fell 6.5 million cases, 2.7 per cent.

Tequila and mezcal, the second-largest category by revenue at USD 6.4 billion, fell 4.1 per cent. Volume was 32.1 million cases, down 0.3 per cent. Vodka, still the largest at USD 7.0 billion, fell 3.0 per cent.

The number that is not in the press release

Divide one by the other. USD 6.4 billion over 32.1 million nine-litre cases is USD 199 a case, or USD 22.15 a litre at supplier level — the price anchor our Global Agave Spirits report uses for every non-US value in the category.

Now compare the two rates of change. Revenue −4.1 per cent on volume −0.3 per cent means the price of a case of agave spirits in the United States fell 3.8 per cent in a year. Mexican production in the same twelve months rose 17.7 per cent to a record 583.5 million litres.

Supply up 17.7 per cent. The realised price in the only market that matters down 3.8 per cent. That is the whole category in two numbers, and neither of them is a forecast.

The pipeline, and an honest caveat

Two official series describe the same flow from opposite ends, and they do not agree. The CRT certified about 408 million litres of tequila for export in 2025, of which roughly 335 million went to the United States. US supplier sales of tequila and mezcal were 32.1 million nine-litre cases — 288.9 million litres.

The difference is 46 million litres, about 14 per cent of the flow. These are not the same measure: one counts certified shipments across a border, the other supplier sales into a three-tier distribution system. Some of that gap is definitional and some of it is inventory sitting between a port and a shelf. We cannot split it from published data, and any analyst who tells you they can is guessing. What can be said is that a 14 per cent spread between what left Mexico and what was sold in America is the size of the buffer the chain is holding — and that a buffer of that size is a reason for the next order to be smaller, not larger.

The demographic engine is real, and it is not the ceiling

The standard explanation for the last decade of agave growth is demographic: the United States has 70.1 million Hispanic residents as of 1 July 2025, 21 per cent of the population, according to the Census Bureau’s Vintage 2025 estimates. Sixteen states now have a million or more Hispanic residents.

That is a genuine engine, and the arithmetic shows it has already done its work. Divide 335 million litres by 70.1 million people and you get 4.8 litres per person — even if every litre exported to the United States were drunk by a Hispanic American, and none by anyone else, and at 100 per cent participation including infants and non-drinkers.

Nobody believes that. Which means the category’s volume can only be explained by buyers well outside that population, and the growth from here cannot come from a demographic tailwind that has already been spent. It has to come from general-market penetration, in a total US spirits market that is shrinking and where vodka — the incumbent the category has been taking share from — is still 9 per cent larger by revenue.

That is a harder market than the one the category has been winning. The four-year run of share gains from vodka was driven by a specific occasion, the margarita and the paloma, and by a specific price ladder. In 2025 the price ladder went into reverse.

The 82 per cent sits inside a duty-free corridor

Tariff risk is the obvious exposure and the current position is less alarming than the headlines. As of August 2026, US imports from Mexico face a 10 per cent tariff under Section 301, from which goods qualifying under USMCA are exempt; Section 232 duties apply to steel, aluminium and copper, not to spirits. Tequila is wholly obtained in Mexico and cannot be made anywhere else, so it qualifies.

The Congressional Research Service’s August 2026 survey records the consequence: in June 2026, 87 per cent of US imports from Mexico entered under USMCA, up from 46 per cent in January 2025 before the tariff actions. The tariff regime did not tax agave spirits. It pushed the entire Mexican border into the agreement that exempts them.

So the risk is not today’s rate. It is that the exemption is a policy choice, renewed by review, and the category has no second market of any size to absorb a change in it. A 10 per cent tariff on a USD 6.4 billion flow, if the exemption went, is USD 640 million — against a category whose entire US supplier revenue fell by USD 274 million last year.

The exit rate is worse than the year

The annual figures understate the direction of travel. Becle, the largest brand owner, reported 2025 volume down 4.4 per cent but fourth-quarter volume down 8.8 per cent, with the United States and Canada down 11.6 per cent and Mexico down 11.9 per cent. A category that accelerates downward through the year is not one whose next twelve months resemble its last twelve.

And the production record sits awkwardly against all of it. Mexican output rose 87.7 million litres in a year while the largest brand owner’s volume fell, while US revenue fell, and while the price of the input fell two thirds. The extra liquid did not find extra demand. It found cheaper fruit and a static shelf.

Concentration is not automatically a weakness — the United States is the only market with the depth to buy 335 million litres at a premium. But it means every risk in this category resolves to a single test: whether one country, one currency, one three-tier system and one tariff exemption continue to want the same quantity at the same price. Four variables, one answer required.