Mixto Is Dying, and It Isn't Premiumisation

Mixto — the tequila made with only a majority of agave sugars, topped up with other fermentable sources — is no longer the majority of anything. In 2025, 100 per cent agave product was 415.4 million litres of a 583.5 million litre category, 71 per cent of production. Mixto was 168.1 million litres.

That is a ratio worth stopping on. The cheaper, lower-agave product that built the category’s volume in the twentieth century is now under three tenths of it, and it is shrinking inside a year when the category grew 17.7 per cent.

The quality mix of tequila has flipped in a single generation, and almost nobody who models the category treats it as a variable at all.

The flip is what the margin story is really about

US supplier revenue for tequila and mezcal fell 4.1 per cent to USD 6.4 billion in 2025 on volume flat at 32.1 million cases. Sit that beside the production mix and a real paradox appears: the product got better and the price got worse.

The resolution is that both movements have the same cause. When blue agave falls from MXN 22.21 to MXN 7.62 a kilogram, the ingredient that distinguishes 100 per cent agave from mixto becomes cheap. The premium product’s cost advantage-of-quality stops being expensive to deliver. Producers can put 100 per cent agave on the shelf at something approaching what mixto used to cost — and in a market with flat case volume and record production, they do, and they compete it away.

So the mix improvement and the revenue decline are not two facts. They are one fact observed from two angles: the collapse in agave prices let the category upgrade its product without being able to charge for the upgrade.

This is the mirror of the premiumisation story

The standard consumer-goods playbook says mix improves first, then price follows, then margin expands. Sugar reduction, craft production, provenance claims — the pattern holds in most categories because the input that carries the claim is genuinely scarcer than the alternative.

Tequila has just run the opposite sequence. The mix improved because the scarce input became abundant. That is a structurally unusual position and it means the usual read-through from mix to margin fails completely here. A rising share of 100 per cent agave product in this category is not evidence of premiumisation. It is evidence of agave being cheap.

Which gives you a clean test for the future: if agave prices recover and the 100 per cent agave share holds, that is real premiumisation and it will come with margin. If the share holds only while the plant is cheap, the first sustained rise in farm-gate prices will push consumers back toward mixto, and the category’s quality mix will be revealed as a function of an input price rather than of a consumer preference.

The measurement problem sitting underneath

There is a further complication that anyone doing serious work on this category hits quickly: the two official sources for the same flow do not agree.

Mexico’s Consejo Regulador del Tequila certified 408.0 million litres of exports, with the United States at about 82 per cent of them. The Mexican agriculture ministry publishes 397.1 million litres on a customs basis. Two official numbers, one flow, no reconciliation in the public series.

The gap is the sort of discrepancy that comes from what is being counted rather than from a mistake — certification at origin versus clearance at the border, timing differences, re-exports, bulk versus bottled. But its existence defines the limit of the instrument: any consumption estimate for this category inherits a base that two official bodies in the same country describe differently, before anybody has even left Mexico.

It is also why the market values in this sector have to be built rather than read. The category is sized at USD 10.79 billion in 2025 by applying the US supplier price of USD 22.15 a litre to the export pool and 45 per cent of that price to the domestic pool — a construction, explicitly, not a survey. That is the honest way to do it, and it is worth knowing that the number is a construction.

What follows

Do not read mix as premiumisation in this category. The 71 per cent 100 per cent-agave share is a statement about the agave price as much as about the consumer. Track the two together or you will draw the wrong conclusion twice — once on the way in and once on the way out.

The mixto floor is the category’s hidden capacity. 168.1 million litres of production still sits in the lower tier. If agave recovers and pricing pressure returns, that is where volume goes. A category with a large cheap tier can absorb a demand shock by trading down; one that has abandoned the tier cannot.

The export concentration is the risk. With exports at 408.0 million litres certified and roughly 82 per cent of them going to the United States, the agave category is close to a single-market business dressed as a global one. Everything above — the mix, the price, the margin — is a derivative of what happens to American demand for a Mexican spirit, and the record production year did nothing to diversify that.

The one-line version: mixto’s decline looks like a quality story and is actually a price story, because the only reason the premium product became affordable to make is that the plant behind it got cheap.

Companion analysis: Global Agave Spirits (Tequila & Mezcal) Market Report, Size & Forecast 2026–2033.