Is the Tequila boom over?

April 10, 2025 by Forbes.com

Several months ago, the Financial Times, echoed by the Wall Street Journal and other media worldwide, announced that “Mexico is sitting on more than half a billion liters of tequila in inventory, almost as much as its annual production,” indicating a significant oversupply issue. The CRT has not responded, until now, to the claim of a massive Tequila supply overhang. Below are their comments on the state of the Tequila market.

The relentless rise of Tequila has been well-documented. According to the Distilled Spirits Council of the US (DISCUS), between 2004 and 2024, the volume of Tequila shipments to the United States increased by 271%, from approximately 8.67 million to 32.19 million 9-liter cases, an average annual increase of 6.86%. The revenue growth has been even more dramatic.

During those 20 years, revenues increased from $1.07 billion to $6.52 billion, an increase of 509%. The increase was most pronounced in higher-priced, High-End Premium, and Super Premium categories. During this period, revenue for Value Tequila increased by 150%, from $145 million to $363 million. Revenues in the High-End Premium increased by 1140%, from $110 million to $1.364 billion, and by 2192%, from $139 million to $3.19 billion, in the Super Premium category.

According to the CRT, “production was broadly consistent with, though at times exceeded, the increases experienced in US and international sales.” In 2022, according to the CRT, Mexico produced 651.5 million liters of Tequila. 418.9 million liters were exported, of which 338 million were sent to the US. Approximately 93 million liters were consumed domestically. Total demand in 2022 was roughly 512 million liters, resulting in a surplus of approximately 139.5 million liters, the equivalent of a fifteen-week supply.

In 2023, Mexico produced 598.7 million liters of Tequila. Approximately 401.4 million liters were exported, down around 4%. About 321 million liters were sent to the US, a decline of about 5%. Domestic demand was approximately 93 million liters, resulting in a total demand of around 494.4 million liters and a surplus of around 104.3 million liters.

In 2024, Mexico produced 495.8 million liters. Exports amounted to 402.1 million liters, slightly ahead of 2023. Exports to the US increased to 334 million liters, an increase of 4%. Domestic demand stayed steady at around 93 million liters on average. That leaves total demand at around 495.1 million liters, virtually even with production.