As USTR Testifies, NABI Finds Hope for Airbus/Boeing Tariff Resolution

Posted on April 28, 2021 by Joel Whitaker

In listing her early successes as the new U.S. Trade Representative, the first one Katherine Tai mentioned was the the four-month suspensions of the Airbus/Boeing tariffs with the EU and UK.

Robert M. Tobiassen, president, National Association of Beverage Importers, said this was very encouraging.  “While NABI would have appreciated hearing a few more specifics on the next ‘bold step(s)’ forward, nevertheless the Ambassador’s mention here the large civil aircraft dispute is a very promising sign for successful settlement negotiations.”

Tobiassen added, “It is likely the meetings leading up to and including the G7 ministerial on June 11-12, 2021, hosted by the UK Government, will be the venues for the political discussions and concrete decisions on the margins of these meeting, at a minimum.”

The G7 Members are Canada, France, Germany, Italy, Japan, United Kingdom, and United States of America.  The European Commission attends and participates in the G7 meetings.  The key countries and regional economic entity in the large civil aircraft disputes are there.

“Certainty is essential for importers to plan ahead, especially in light of the transportation and container shipping delays in both the country of export and the port of entry in the United States” pointed out Tobiassen.

“The immediate announcement of an additional suspension period or a permanent suspension is the exact certainty desperately needed by importers of wine and spirits; such an announcement in mid-June, after the G7 ministerial, before the expiration of the temporary suspension with the UK on July 4, and with the EU on July 11, simply fails to provide certainty now by the importer business community and its workers” added Tobiassen.

In her testimony, Tai said USTR is” developing and implementing a worker-centered trade policy that complements and supports the domestic investments in the American Jobs Plan. The President’s Trade agenda will foster broad-based, equitable growth that increases innovation and enhances the country’s competitive edge and that’s crafted with workers at the table.

“For the first time, we committed to using trade policy to address racial equity and support underserved communities,” Tai said, adding: “Through thoughtful, sustained engagement and utilizing data, the Biden Administration will develop a better understanding of how proposed trade policies affect all Americans as people and their communities, especially communities of color. And we will consider those impacts in our process for making policy decisions.

“In just a few short months, USTR has already delivered results for American workers. In March, USTR announced a four-month suspension of tariffs with both the United Kingdom and the European Union related to the long-running World Trade Organization (WTO) dispute over certain large civil aircraft subsidies. This was a bold step towards finally resolving the issues that have impacted the U.S. industry and its workers,” she said.

Tobiassen noted “Tai linked the temporary suspension of the large civil aircraft tariffs to advancing the worker centric guidepost or pillar for the trade policy of the Biden/Harris Administration.

“The extension of the temporary suspension for two or even six more months only strengthens the protection of American workers in the import industry and the workers in the collateral or dependent industries in the distribution chain,”  Tobiassen said.

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Yellow Tail, Casillero del Diablo Remain World’s Most Powerful Wine Brands Amid Global Erosion of Brand Equity

Posted on April 28, 2021 by Joel Whitaker

You can count wine brand equity as a victim of Covid.  The erosion is a result of the disruption to shopping and consumption patterns experienced during the Covid era, and Wine Intelligence, which surveyed 25,000 consumers in 25 markets, warns it may take some time for brand owners to restore brand equity, according to Wine Intelligence.

Yellow Tail and Casillero del Diablo once again claim the top two spots in the 2021 Global Wine Brand Power Index. Both brands showed lower index scores in 2021 versus 2020, principally arising from less recalled purchase incidence and lower brand connection scores, with similar declines affecting all of the top 15 global brands.

Jacob’s Creek has regained its top three position in the Index, having lost it in 2020 to Gallo. It swaped places largely on the strength of having grown its awareness score in 2021, one of only six brands in the top 15 to record a positive result on any measure.

Notable movers in the 2021 Wine Intelligence Global Wine Brand Power Index include Santa Carolina, which rises three places to take a top 10 spot in the Global Index for the first time; Torres, which has jumped five places to 10th, having entered the top 15 for the first time in 2020 and Campo Viejo, which enters the top 15 for the first time.

Commenting on the rankings, CEO Wine Intelligence Lulie Halstead said: “In a year characterized by disruption and lockdown, it has been a challenging year for wine brands. Whilst mainstream wine brands have benefited from a consumer shift towards tried and trusted brands, overall, wine brands have lost ground in terms of consumer connection, due to the fact that consumers were not browsing wine aisles as often, and have had other things on their minds in the past 12 months – justifiably so.”

She added: “As we emerge from lockdowns into – we hope – a more stable shopping environment, the key challenge for successful wine brand owners will be restoring the fundamental positive connections that have propelled their brands to such widespread success on the world stage in the first place.

“This will include: being relevant at more traditional wine occasions as well as the new ones of the Covid era; being available in the channels of distribution that are becoming more popular, and looking the part for a global audience that appears to be seeking reassurance and excitement in equal measure.”

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Control States Spirits Case Sales Grew 2.9% in March

Posted on April 28, 2021 by Joel Whitaker

During March nine-liter control states spirits case sales grew 2.9% over same period sales last year despite a “monster” 17% comp, National Alcoholic Beverage Control Association reports.

Michigan (25.5%), Montana (16.8%), and Pennsylvania (11.2%) reported monthly growth rates for March exceeding their 12-month trends. Growth rates for Alabama (6.2%), Iowa (9.8%), Idaho (-5.9%), Montgomery County Maryland (-21.4%), Maine (7.9%), Mississippi (16.9%), North Carolina (-3.0%), New Hampshire (-31.7%), Ohio (0.2%), Oregon (-8.8%), Utah (-8.2%), Virginia (-5.3%), Vermont (-6.0%), West Virginia (-7.9%), and Wyoming (4.5%) fell short of their twelve-month trends. Control state rolling-12-month-volume growth, 6.6%, slipped from February’s reported 7.7%. Spirits volumes are growing 4.2% year-to-date compared to 8.7% a year ago.

Control state spirits shelf dollars were up 12% during March while trending at 13.5% during the past 12 months. Iowa (17.1%), Maine (16.3%), Michigan (36.2%), Mississippi (28.7%), Montana (25.6%), Pennsylvania (19.5%), and Wyoming (12.8%) reported growth rates exceeding their 12-month trends. Alabama (13.3%), Idaho (3%), Montgomery County Maryland (-15%), North Carolina (7.2%), New Hampshire (-31.2%), Ohio (12.9%), Oregon (-1.2%), Utah (0.1%), Virginia (5.0%), Vermont (1.3%), and West Virginia (-1.3%) grew shelf dollars at rates below their 12-month trends. Shelf dollars in the control states are up 11.9% year-to-date compared to 10.8% last year.

Price/Mix for March is 9.1%, up from February’s reported 6.8%.

Premiumization continues to drive Price/Mix in the control states. March’s 9.1% reported Price/Mix is the second highest value ever reported. During March 2021, the median price of 750 ML spirits volumes sold in those control states that set the retail price point was $24.98 (the second highest value recorded in the control states) and the weighted average price of 750 ML volumes was $17.85 (also the second highest value recorded). During last year’s March, these prices were $23.99 and $16.34, respectively.

During the period March 2020 through February of 2021, the control states’ on- and off-premise markets behaved capriciously. However, during March the on-premise share of the control state market climbed to a value that is less than 4% below its historical March share, suggesting the on-premise marketplace recovery in the control states is strengthening, as would be expected, as COVID restrictions are lifted.

Cocktails, with 3% share of the nine-liter case control states spirits market, was March’s fastest growing category with 41.9% reported and a twelve-month trend of 44.0%. Tequila, with 8% share, grew during March at 40.5% and 23.9% during the past twelve months. Cordials, with 7% share, grew at 24.7% during March and 6.5% during the past twelve months. Vodka, with 32% share, grew during the same periods at -5.5% and 0.6%, respectively.

Cordials (24.7% during March, 6.5% during past twelve months), Irish Whiskey (10.9%, 5.5%), and Tequila (40.5%, 23.9%) grew at rates above their 12-month trends, while Brandy/Cognac (7.6%, 15.9%), Canadian Whiskey (1.8%, 6.8%), Cocktails (41.9%, 44.0%), Domestic Whiskey (-0.4%, 9.6%), Gin (-5.8%, -0.1%), Rum (-2.2%, 1.5%), Scotch (-8.6%, 0.5%), and Vodka (-5.5%, 0.6%) grew at rates below their 12-month trends.

March’s nine-liter wine case sales growth rate was -14.5%. Pennsylvania (reporting -17.4% nine-liter-case growth for wines), New Hampshire (-12.9%), Mississippi (-1.7%), Utah (-14.4%), Montgomery County Maryland (-13.3%), and Wyoming (-13.4%) are the control states that are the sole wholesalers of wines and spirits within their geographical boundaries. Rolling-12-month wine volume growth in these six control states is 0.1%, down from February’s reported 3.0%.

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J. Neal Insley to Head NABCA; Sgueo Retires

Posted on April 28, 2021 by Joel Whitaker

J. Neal Insley was named president/CEO, National Alcoholic Beverage Control Association. He succeds Jim Sgueo, is retiring after 53 years with NABCA and who has served as its CEO for 28 years.

“Neal’s experience in enforcement, his legal background, his role as former chairman of the Virginia ABC and his role on the NABCA board, as well as his current position makes him the perfect candidate to step into this leadership role,” said A.D. Zander Guy, NABCA Chairman of the Board. “The selection committee felt that his understanding of beverage alcohol from these numerous perspectives will allow him to carry on with NABCA’s vision and mission, and continue to move the Association forward,” Guy added. “As we look to the future, we’re confident that Neal is the right person to lead the association in providing the highest level of service and support to the control jurisdictions as well as the industry.”

Sgueo said he is “confident Insley is the right person to lead the association and feel positive he will provide the highest level of expertise to the control jurisdictions, the industry and other stakeholders.”

Insley began his career in 1993 as a police officer with the Virginia Marine Police. In 1996, he was hired as a special agent with the Virginia ABC. In 1999, he began attending law school and continued to perform his duties as an ABC Special Agent. In 2003, he graduated from law school and was admitted to practice law in Virginia.

He later left law enforcement to work as a state prosecutor in two separate jurisdictions. He then entered the private sector and focused on alcohol beverage law. In his private practice, he had represented clients in an array of alcohol beverage control related issues ranging from small, sole proprietorships to national chain restaurants, distributors and manufacturers of alcohol.

In 2010, Virginia Governor Robert F. McDonnell appointed Insley to serve as Commissioner and full-time Chairman of the Virginia ABC Board. He served as Chairman of the NABCA Board from 2012-2014 and became the association’s full-time, in-house general counsel in 2015.

The appointment was praised by Chris Swonger, president/CEO, Distilled Spirits Council of the U.S.  “Neal brings to the position a deep understanding of the control state system from his current role at NABCA and as a former chair of the Virginia ABC. He fully understands the careful balance control states aim to achieve in fulfilling the important regulatory and responsibility functions of the control state system, while also generating revenue and providing first-rate customer service,” Swonger said.

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Economy Watch: The Cities Most Recovered from Covid

Posted on April 28, 2021 by Joel Whitaker

The economy gained 916,000 jobs in March, and the national unemployment rate is now 6%, which is 59% below the peak of 14.7% during the height of the COVID-19 pandemic. To provide more context at the city level, WalletHub today released its report on the Cities Whose Unemployment Rates Are Bouncing Back Most, as a follow-up to our report on the States Whose Unemployment Claims Are Recovering the Quickest, along with accompanying videos and audio files.

This report uses new data from the Bureau of Labor Statistics, which disclosed that it erroneously didn’t count some workers on temporary layoffs as unemployed. Therefore, the real unemployment rate may be around 7% higher than reported, and our report includes both the official rate and an “adjusted” rate based on this error.

Below, you can see highlights from the report, along with a WalletHub Q&A.

Most Recovered Cities
1. Lincoln, NE 11. West Valley City, UT
2. Rapid City, SD 12. Manchester, NH
3. Omaha, NE 13. Missoula, MT
4. Salt Lake City, UT 14. Springfield, MO
5. Overland Park, KS 15. Lexington-Fayette, KY
6. Sioux Falls, SD 16. Madison, WI
7. Huntsville, AL 17. Burlington, VT
8. South Burlington, VT 18. Durham, NC
9. Nashua, NH 19. Nampa, ID
10. Billings, MT 20. Boise, ID

To view the full report and your city’s rank, please visit: https://wallethub.com/edu/cities-unemployment-rates/73647/

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Marie Brizard Claims Turnaround in Earnings

Posted on April 28, 2021 by Joel Whitaker

And there was — if you use EBITDA.  Marie Brizard Wine & Spirits reports EBITDA of $12.85 millionfor fiscal 2020, reversing the 2019 EBITDA loss of  $4.24 million.  But when you apply conventional accounting rules, the French producer significantly narrowed its loss from continuing operations to $6.67 million from a loss of $36.62 million.   It also narrowed its accounting loss to $46/57 million from a loss of $65.9 million a year earlier.

Andrew Highcock, CEO, said that with a strengthened financial structure, the Group will “pursue the alignment of its costs to the size of the business on a country-by-country basis, as a key to the sustainable  consolidation of its profitability. Focused on leading brands or brands with a growing
reputation, MBWS is committed to addressing new consumer trends, seeking more  naturalness and less alcoholic products.

“The pandemic has also led to the emergence of home consumption of cocktails, a trend that is likely to continue. After these encouraging results in 2020, the Group remains  cautious for 2021 as the economic impact of the pandemic persists at the beginning of the year in many of its markets.”

But MBWS’s first quarter sales, also released yesterday, show organic sales growth fell 6.9%.  That’s largely because sales outside France plunged 17.1%.

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