Premium rum industry faces setback but eyes ‘bright future’

Sales of premium rum from the Caribbean have dipped considerably this year, according to the West Indies Rum and Spirits Producers Association (WIRSPA), as industry leaders cite a combination of international instability and supply chain issues for the downturn. 

However, forecasts for the next five years indicate a potential recovery, prompting producers to invest in sustainability and branding to boost the industry, it said.

Chief Executive Officer Vaughn Renwick blamed a range of external issues for the below-par performance.

He said: “Coming out of COVID-19, we saw a resurgence of demand in 2022 and that did not continue; it sort of levelled off in 2023, and while we expected a resurgence in 2024, it didn’t quite happen. We think it’s a combination of international instability, a certain amount of politics, issues with supply chains, but generally, 2024 has not been a great year.” He did not provide any figures.

In its latest economic review, covering the first nine months of the year, the Central Bank of Barbados said the island’s domestic exports fell marginally by 0.6 per cent, largely due to reduced rum exports.

In a 2022 report, the bank indicated that rum and other beverages contributed $84.8 million to the island’s gross domestic product. The following year, a preliminary report said the industry contributed $87.7 million. But as of September this year, it was estimated that the industry contributed only $64.4 million.

But Renwick was upbeat about the regional rum industry’s projections over the next few years, things should improve.

He said: “We think things will pick up; the overall outlook for the next five years is very good and premium rum, which is the Caribbean’s and Barbados’ top export, is going to be doing well in the long term. So that’s what we’re banking on.”

Renwick added that industry players were readying themselves in anticipation of the rum boom by investing in sustainable and developmental projects, such as expanding capacity, improving branding and telling a better story of Caribbean rum.

The WIRSPA chief said: “One of the things that we are doing is looking at how we tell our stories. For instance, here at Rémy Cointreau, one of their mantras is drink less, drink better. They premiumise and premiumise and premiumise by offering innovative, new spirits and saying to people: ‘You’re going to pay a bit more for this but it is going to be a really great product for you to enjoy.’ So, drinking less but drinking better products and more premium products is part of that strategy.” 

He continued: “The Caribbean is a home of premium rum. Our rums are known internationally as high-quality products with a story behind them, and Barbados has a lot of that story in it. So, in presenting these premium products, one of the ways in which we do it is presenting age products, and investing in new barrels and warehouses is a key element to build in your provenance and your quality and your story. There are other ways of doing it which might be related to your production traditions and techniques, but investment in barrels is something that everybody is doing.

“We are not looking five years down the road or ten years; we’re looking 20 years down the road because, of course, rum being put down now is going to be sold, some of it, in 20 or 25 years. So, it is very much a long-term vision and even though 2024 has not been a great year for premium rum for the industry, this is a statement that we believe in the future and that we are prepared to put money into the future of premium rum by building the Caribbean story and saying to the world that premium rum quality comes from the Caribbean and from Barbados.” 

sheriabrathwaite@barbadostoday.bb