Texas on-premise alcohol beverage tax receipts (TAP)
Texas reports its alcoholic beverages sales tax receipts monthly. In August, alcoholic beverage receipts increased 7.4% YOY. That represents a slight deceleration from July’s 8.8% growth. Sales were 19% greater than in August 2019. In Texas, bars have been mostly open with limited restrictions since October 2020. Growth in the on-premise channel is led by states that removed on-premise restrictions later including New York, California, and Illinois.
On-premise sales trends continue to improve compared to the prior year as seen in the chart below from CGA and NielsenIQ. For the week ended August 27, sales velocity increased 12% YOY. Higher check is driving the growth at +10%, but traffic grew 2%. Over the 12-week period, sales velocity was up 5%.
Hard seltzer struggles continue (STZ, SAM)
Total beverage alcohol sales increased 1% YOY for the week ending August 21 according to IRI. The beer category slightly outpaced the alcohol category with growth of 2%. Beer category hard seltzer sales decreased 12.3% while spirits-based hard seltzer sales increased 84%. Truly hard seltzer sales decreased 23.5%. Twisted Tea sales grew 35.1% in the week boosted by a college football marketing campaign, a bright spot for Boston Beer. Bud Light Seltzer sales decreased 27.9%. Vizzy hard seltzer sales decreased 25%. There were some bright spots in hard seltzer. White Claw sales increased 1.4% as it lapped declines last year. Molson Coors’ Topo Chico sales increased 118%.
While hard seltzer continues to struggle, imports continue to lead beer. Imported beer sales increased 10% for the week, leading all segments of beer. Modelo brand sales grew 20.8% in the off-premise channel. Corona brand sales grew 8.4% for the week while Pacifico sales grew 52%. Hard seltzer has increasingly become a seasonal beverage, while Constellation Brands continues to be the growth story in beer.
Emergency extension (KR)
The Department of Health and Human Services says it plans to extend the COVID-19 Public Health Emergency (PHE) an additional 90 days. The PHE is currently set to expire on October 13. An extension would ensure expanded Medicaid coverage, telehealth services, boosted payments to hospitals and enhanced food stamp payments. The extension would continue the coverage beyond the November election and into the new year. Most states have continued enhanced SNAP payments, which increased the benefit by 15% this year. SNAP recipients spend more on food at home per capita than those who do not. The loss of the additional 15% payment would be felt immediately at grocers and mass retailers.
