Global Alcohol Consumption Declines 1% in 2024, Projected to Shrink 5–10% by 2030 Amid Health Trends

Shifting Tides: The Potential Permanent Decline in Global Alcohol Consumption and Its Investment Implications

Global alcohol consumption appears poised for a sustained downturn, with emerging data suggesting this shift could mark a structural change rather than a fleeting trend. Recent surveys and market analyses indicate that fewer consumers are reaching for alcoholic beverages, driven by health awareness, demographic shifts, and evolving social norms. This development carries profound implications for investors in the beverage sector, potentially reshaping valuations and strategies for companies reliant on traditional spirits, beer, and wine sales.

Evidence of Declining Consumption Patterns

Industry reports highlight a consistent drop in alcohol intake across key markets. For instance, data from Gallup’s 2025 poll reveals that only 54% of American adults report drinking alcohol, the lowest figure in nearly nine decades of tracking. This represents a notable decline from 62% in 2023 and 58% in 2024. Similarly, the International Wine and Spirits Record (IWSR) notes a global beverage alcohol volume decrease of 1% in 2024, with major markets like the United States and China experiencing sharper contractions.

These figures align with broader behavioural changes. A surge in moderation strategies, such as lighter drinking or temporary abstinence, has become mainstream. IWSR’s Bevtrac consumer research across 15 key markets shows that ‘light’ drinkers—those with low frequency or intensity—now form the largest segment, overtaking medium and heavy consumers. This moderation spans demographics, though it is particularly pronounced among younger adults, including Generation Z, who are increasingly opting for non-alcoholic alternatives.

Driving Forces Behind the Trend

Health concerns stand out as a primary catalyst. A majority of Americans—53% according to Gallup—now view even moderate alcohol consumption as harmful to health, a sentiment that has gained traction amid public health campaigns and updated guidelines. The US Surgeon General’s warnings and deferred reviews in the 2025-2030 Dietary Guidelines for Americans underscore this evolving perception, potentially influencing policy and consumer choices further.

Demographic dynamics also play a role. Younger cohorts, including those aged 18-34, are drinking less, with factors like economic pressures, mental health priorities, and the rise of sober-curious lifestyles contributing. Reports from sources like TIME magazine indicate that Generation Z’s reduced alcohol intake stems from a mix of wellness trends, social media influences, and alternatives such as cannabis or non-alcoholic beverages. Meanwhile, political affiliations show intriguing patterns: Republican drinkers in the US have seen a steeper decline, dropping from 65% in 2023 to 46% in 2025, per Gallup, while Democratic rates remain steadier.

Economic factors exacerbate the shift. Inflation and cost-of-living pressures have made alcohol less affordable, prompting consumers to cut back on discretionary spending. In Germany, beer production fell 6.3% year-on-year in 2025, reflecting diminished local demand for alcohol-containing varieties. Globally, IWSR forecasts continued softness in the sector, with at-home consumption and digital experiences gaining ground over traditional social drinking occasions.

Market and Industry Impacts

The beverage alcohol industry faces a correction, as noted by analysts at NCSolutions and USA Today. While the category remains substantial, consumption is unevenly distributed, with some brands thriving amid declines in others. For example, the US soju market has grown rapidly, projected to reach $425.8 million by 2031 from $254.67 million in 2023, buoyed by interest in Korean culture. Conversely, American whiskey has seen depletions drop by an estimated 6.82% year-on-year in mid-2025.

Investors should monitor how companies adapt. Major players in spirits and beer may pivot towards low- or no-alcohol products, which are gaining momentum. IWSR identifies moderation as a key 2025 trend, with consumers implementing strategies like abstaining during certain periods— a practice especially popular among younger legal-drinking-age groups. This could pressure margins for traditional alcohol producers, as non-alcoholic segments often carry lower price points but higher growth potential.

Valuation multiples in the sector may compress if declines persist. Historical trends show that during periods of reduced consumption, such as post-2008 financial crisis, alcohol stocks underperformed broader indices. Analyst models from firms like Bloomberg suggest that if global volumes continue to fall at 1-2% annually through 2030, aggregate industry revenues could shrink by 5–10%, assuming no major pricing adjustments. Sentiment from verified sources, such as ZeroHedge, labels this as a “massive behavioural shift,” with investors increasingly viewing alcohol as a health liability rather than a staple.

Investment Opportunities and Risks

Amid the downturn, opportunities emerge in adjacent spaces. The non-alcoholic beverage market is expanding, with products mimicking traditional drinks but without the alcohol content. Escoffier’s 2025 trends report points to rising interest in alternatives like applejack and soju-inspired non-alcoholics, which could capture market share from declining segments.

• Diversification Strategies: Companies investing in ready-to-drink (RTD) low-alcohol options or functional beverages may outperform. IWSR projects that no/low-alcohol categories will grow by double digits in several markets through 2025.
• Regional Variations: While Western markets show steeper declines, emerging economies might offer pockets of growth, though global health trends could eventually converge.
• Risk Mitigation: Investors should watch for regulatory changes, such as stricter labelling or taxation on alcohol, which could accelerate the shift. Analyst-led forecasts from Penn State Extension indicate that 49% of US consumers aged 21+ plan to reduce drinking in 2025, up from 41% in 2024.

From a portfolio perspective, this trend underscores the need for agility. Sectors like cannabis or wellness products may indirectly benefit, as consumers substitute away from alcohol. However, dry humour aside, betting against a centuries-old industry requires caution—after all, social lubrication has weathered wars and recessions before, but this health-driven pivot feels different.

Looking Ahead: Analyst Projections

Forecasts remain cautious. IWSR’s 2025 global trends report outlines six shaping factors, including economic caution and introspective consumption, predicting ongoing volume softness. If moderation becomes entrenched, as suggested by Gallup’s record-low 24% of drinkers reporting consumption in the past 24 hours (down from 32% in 2023), the industry might see permanent realignment. Analyst models project a compound annual decline of 0.5–1.5% in global alcohol volumes through 2030, with upside risks tied to innovation in non-alcoholic spaces.

In summary, the potential permanence of declining alcohol consumption signals a paradigm shift for investors. By focusing on adaptable companies and emerging trends, portfolios can navigate this sober new reality. All data referenced is as of 21 August 2025.

References

• Auguste Escoffier School of Culinary Arts. (2025). Alcohol and beverage trends. https://www.escoffier.edu/blog/world-food-drink/alcohol-and-beverage-trends/
• Business Insider. (2025). Republicans driving historic low alcohol consumption. https://www.businessinsider.com/republicans-driving-historic-low-alcohol-consumption-2025-8
• CNN. (2025, August 14). Alcohol drinking declines. https://www.cnn.com/2025/08/14/health/alcohol-drinking-declines
• Gallup. (2025). Drinking rate at new low as alcohol concerns surge. https://news.gallup.com/poll/693362/drinking-rate-new-low-alcohol-concerns-surge.aspx
• IWSR. (2025). Five key trends shifting the beverage alcohol market. https://www.theiwsr.com/insight/five-key-trends-shifting-the-beverage-alcohol-market-in-2025/
• NCSolutions. (2025). Sober curious nation alcohol survey. https://ncsolutions.com/the-goods/sober-curious-nation-alcohol-survey/
• Penn State Extension. (2025). Alcoholic beverage trends 2025. https://extension.psu.edu/alcoholic-beverage-trends-2025
• San Francisco Chronicle. (2025). Drink alcohol Americans poll. https://www.sfchronicle.com/food/wine/article/drink-alcohol-americans-poll-20812180.php
• TIME. (2025). Gen Z is drinking less alcohol. https://time.com/7203140/gen-z-drinking-less-alcohol/
• USA Today. (2025, January 21). Alcohol trends 2025: moderation and non-alcoholic survey. https://www.usatoday.com/story/money/2025/01/21/alcohol-trends-2025-moderation-low-non-alcoholic-survey/77351695007/
• WGAL. (2025). Record-low American alcohol consumption: Gallup poll. https://wgal.com/article/record-low-american-alcohol-consumption-gallup-poll/65789678
• ZeroHedge. (2025). Republican alcohol consumption plunges while Democrats’ drinking remains steady. https://www.zerohedge.com/political/republican-alcohol-consumption-plunges-while-democrats-drinking-remains-steady-amid
• The Drinks Business. (2025, August 10). Data-backed insights shaping the drinks industry. https://thedrinksbusiness.com/2025/08/10-data-backed-insights-shaping-the-drinks-industry
• The Shout. (2025). The six global trends shaping beverage alcohol in 2025. https://theshout.com.au/the-six-global-trends-shaping-beverage-alcohol-in-2025