Alcohol sales in Sub-Saharan Africa grew 1% in 2025, IWSR says

Sub-Saharan Africa is set to remain one of the beverage alcohol industry’s main long-term growth markets, but producers face deep obstacles that go beyond normal business cycles, according to new data from IWSR released this week.

The research group said total beverage alcohol volumes in the region rose by 1% in 2025 and are expected to grow at a compound annual rate of 2% from 2025 to 2035. It said every major category is projected to expand over the next decade, even as companies deal with economic volatility, weak distribution networks, affordability pressure and the strong position of local and informal products.

The report points to a basic contradiction that is shaping the market. On one side, countries including South Africa, Nigeria and Kenya have young populations, rapid urban growth and expanding middle classes that support future demand. On the other, many consumers are under financial strain and are choosing cheaper products, smaller pack sizes and locally made alternatives instead of moving toward more expensive international brands.

Russell Menezes, research director for Africa and the Middle East at IWSR, said the region’s demographics continue to attract global attention. He said alcohol brands often carry aspirational value for consumers seeking signs of social mobility, especially in middle-income groups. But he also said the economic challenges in many African markets are not temporary and should be treated as structural features of the business environment.

In 2025, ready-to-drink products, or RTDs, were among the fastest-growing segments in Sub-Saharan Africa, with volumes up 11%. Spirits rose 6%, beer increased 1% and wine fell 3%. Agave spirits, a category that includes tequila, grew 8% and are expected to post annual growth of 5% through 2035.

IWSR said locally produced alcohol remains dominant across the region. In 2025, local products accounted for 97% of beer volumes, 80% of spirits, 87% of RTDs, 59% of wine and 71% of cider. That market structure reflects both price sensitivity and the strength of established domestic and artisanal supply chains.

The report said downtrading has become the defining consumer pattern in recent years. In practice, that means drinkers are moving from spirits to beer, from imports to local brands, and from commercial products to artisanal or informal alcohol. Smaller and cheaper packs are also gaining ground because they fit tighter household budgets.

Religious and cultural limits also shape demand. Alcohol consumption is restricted or prohibited in some parts of the region, adding another layer of complexity for producers that are trying to scale across several African markets at once.

South Africa, Nigeria and Kenya stood out in the report as key markets with different growth drivers and different risks.

In South Africa, IWSR described the market as stable but constrained. The report said affordability pressure is keeping consumption moderate and pushing many drinkers toward simpler and more controlled purchases. Even so, the group said younger adult consumers, especially those in Generation Z who have reached legal drinking age, are showing signs of improving confidence.

Beer remained the most resilient category in South Africa, helped by its place in both social gatherings and drinking at home. Volumes rose 3% in 2025 and are forecast to increase at an annual rate of 2% through 2035.

RTDs rose even faster, with volumes up 14% last year. IWSR said the format is benefiting from compact packaging, lower price points and a profile that appeals to younger adult drinkers and women. It also said some consumers are moving away from larger purchases of spirits and wine and toward RTDs as they try to control spending.

Within spirits, the report identified several pockets of growth. Canadian whisky volumes in South Africa climbed 8% in 2025, while Irish whiskey rose 2%. IWSR said some middle-class consumers see those categories as offering better value than Scotch and a higher perceived quality than local whisky. At the same time, the report warned that heavy discounting in the market could damage brand value, especially in Scotch.

Cognac and Armagnac also posted strong growth in South Africa, rising 18% in volume in 2025. IWSR expects that segment to expand at an annual rate of 5% through 2035. The group said the category’s status image continues to appeal to middle-income and wealthy consumers, including younger legal-age drinkers. Tequila also gained ground, with volumes up 7% in 2025, supported by demand for shots as well as rising interest in premium sipping products.

Nigeria presented a different picture. IWSR said younger consumers there may be harder for the alcohol industry to attract over time, because Generation Z appears less engaged with drinking than older age groups and many abstainers say they have little intention of starting. That leaves millennials as the key consumer cohort. According to the firm’s consumer research, millennials make up the largest share of drinkers in Nigeria and account for the heaviest drinking occasions.

RTDs and spirits, most of them local, both expanded 8% in Nigeria in 2025. IWSR expects each category to grow at an annual rate of 3% from 2025 to 2035. Among spirits, the strongest gains came from gin, bitters, cream liqueurs and whisky.

The whisky segment in Nigeria is also changing because of consumer price pressure. IWSR said Indian whisky is gaining momentum as drinkers look for stronger value, while blended Scotch is losing ground. Even so, the firm said blended Scotch still has a much larger consumer base.

RTDs in Nigeria are led by flavored alcoholic beverages, often known as FABs. IWSR said those products have gained traction because they are convenient and sweeter than beer, which has helped them connect with women and younger adult consumers.

Kenya showed some of the fastest category growth in the report. Local spirits, especially flavored cane products and brandy, rose 13% in volume in 2025. RTDs increased 14%. IWSR expects more moderate growth in the next decade, with spirits rising at an annual rate of 2% and RTDs at 4%.

As in Nigeria, the report said RTDs in Kenya are benefiting from their sweeter taste profile and appeal among younger adult consumers and women. It also said small-format cocktails and long drinks are expanding, with both local and imported brands adding sales.

Some imported spirits posted especially sharp gains in Kenya last year. Irish whiskey volumes jumped 35% in 2025, and tequila surged 65%. IWSR said those categories are likely to slow to more sustainable annual growth rates of 3% and 6%, respectively, as the economy improves and the market develops.

The report covers 25 Sub-Saharan African markets, including Angola, Ethiopia, Ghana, Kenya, Nigeria, South Africa, Tanzania and Uganda. Across that group, IWSR said the long-term demand story remains intact, but companies that want to grow in the region will need to adapt to fragmented trade channels, local competition and consumers who are still prioritizing affordability over premiumization.