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Tequila’s Upscale Movements. (MarketWatch)


Amid a surge in upscale demand that shows no sign of ending anytime soon, Tequila sales are booming in the U.S. market.

The afternoon sunlight is scorching the Tequila Highlands, but within the walls of Hacienda Patrón, the world’s leading luxury Tequila maker, all is cool and sheltered. In the distillery’s cavernous aging room, the sweet scents of wood and slumbering agave spirit fill the darkened, hushed air.

“This is my chapel,” smiles Francisco Alcaraz, Patrón’s master distiller, looking up at the barrels that line the cavernous space. He speaks in whispers, as if careful not to disturb the resting liquid. There’s much discussion about Alcaraz’s latest creation—a Sherry Cask Añejo that’s been aged in Oloroso barrels for over two years. It’s the first entry in a new tier called the Patrón Cask Collection, whose name promises more to come. Sherry Cask Añejo is currently available in travel retail at around $90 a 750-ml., and its U.S. arrival is expected soon.

Also resting in the barrel hall are Tequilas that will compose the Gran Patrón collection, the distillery’s top tier. Those offerings include Gran Patrón Piedra ($400 a 750-ml.), made using a 2-ton, volcanic stone milling wheel called a “tahona,” which crushes the cooked agave and extracts its juices in the traditional fashion. After distillation, Gran Patrón Piedra is aged for four years in French Limousin and new American oak. There’s also Gran Patrón Burdeos ($500), a triple-distilled Añejo finished in Bordeaux barrels and packaged in a Cognac-like crystal decanter. The third entry in the Gran Patrón line is Platinum ($200), a Silver Tequila that’s also triple-distilled.

A generation ago, the presence of such luxury items in a Tequila portfolio was limited, to say the least. Mixto Tequilas—those containing at least 51-percent blue agave and 49-percent cane spirit—were the norm for decades. Today, higher-end 100-percent blue agave Tequilas are spearheading a remarkable growth drive. Since 2005, total Tequila exports to the U.S. market have nearly doubled to almost 18 million cases, with the lion’s share of that increase coming from 100-percent blue agave labels.

“People have come to understand value,” says Francisco Soltero, Patrón’s director of strategic planning and public affairs. “Back in 1995, global exports were at 65 million liters, and 100-percent blue agave Tequilas comprised only 1.2 million liters of the total. Today we’re at nearly 200 million liters—and almost 90 million liters of that are 100-percent blue agave.”

In the U.S. market, 100-percent blue agave Tequila took a majority share for the first time last year, accounting for 50.3 percent of the category. “Exports of standard mixto Tequilas to the U.S. are flat, while 100-percent agave Tequila is growing at nearly double digits,” notes Luis Velasco, president of the Camara Nacional De La Industria Tequilera and proprietor of Mexican drinks importer and Tequila maker La Madrileña. “That appears to be a trend that won’t stop anytime soon.”

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