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MEZCAL HAS LONG been tequila’s lesser-known relative, but this traditional Mexican spirit has been getting a lot more attention recently, presenting both opportunities and challenges for its producers. They may share the same DNA, but tequila and mezcal differ in significant ways – not only in terms of flavour profile, but when it comes to some crucial practical considerations too. The former is produced from a single, cultivated agave variety, for example, while the latter is made from several varieties, many wild. And while tequila is dominated by a few big players, the mezcal industry has traditionally consisted of many small producers.

But mezcal’s growing success has now attracted the attention of the big guys. Bacardi acquired a minority stake in Ilegal mezcal in early 2017, leading to a national US rollout for the brand with Southern Glazer’s Transatlantic Spirits. In June of that year, Pernod Ricard acquired a majority stake in Del Maguey Single Village mezcal. And following Diageo’s acquisition of Casamigos tequila, also in June, for up to $1bn, the brand is now adding a mezcal to its range.

It’s unsurprising, looking at the figures. The most recent stats from the Consejo Regulador del Mezcal (CRM), formerly known as Comercam, published in 2017 and covering the five years to 2016, show a category not only expanding rapidly, both domestically and abroad, but also becoming more premium. Domestically, demand has grown from 270,000 litres bottled in 2011, to nearly 1.9m litres in 2016. Mezcal bottled for export, meanwhile, grew from nearly 650,000 litres in 2011 to over 2m litres in 2016. The number of exported brands rose from 68 to 175, an increase of 157%.

“We’re seeing, relatively early on, people jumping in and buying worthwhile brands and worthwhile distilleries, but it’s still a very artisanal product,” says Wine & Spirit International director Dale Sklar.

US MARKET

For Ilegal’s founder John Rexer, increased involvement by the big spirits companies is inevitable. “As we see with many new trends in the US, mezcal growth has started on the coasts and is moving inward. We are seeing new mezcalerias popping up all over the central part of the US, and many national chains are adding mezcal cocktails to their menus,” he says.

The US is indeed mezcal’s most important market, accounting for 63% in 2016 according to the CRM. The Distilled Spirits Council in the US reports an increase in mezcal sales in the country from under 50,000 cases in 2009 to about 360,000 cases in 2017. After the US, Spain is responsible for 6% of exports, followed by France and the UK, at 5% each.

“All this growth will lead to increased interest from major drink companies,” continues Rexer. “As this expansion happens, the industry must focus on not compromising quality over quantity.”

For a category largely unused to big-brand influence, all eyes are on these new developments. “We have all benefited from the increased awareness, however, I think the concerns being voiced by many are valid,” says David Shepherd, founder and director of relatively new entrant Corte Vetusto. “All you need to do is look at tequila to see what harm international/big business ownership has done to the industry in general and how much the product has been bastardised in pursuit of profit.”

“We think that the fact big players are joining is good for everyone because there is still a relatively large consumer base that is not aware of what mezcal is,” adds Jesus Pedroso, one of the directors of established mezcal brand Bruxo. “However, there’s the risk that the larger players could be tempted to go for industrial expressions soon.”

On the other side of the coin, mezcal continues to face issues of supply – unsurprising when its raw material generally takes a minimum of seven years to grow, not to mention other pressures, such as demand for wild varieties. “We’ve all heard stories of agaveros ripping out 30 year old agaves from the top of the hillside and moving on and not replanting,” says Sklar.

“When it comes to agave shortages, unfortunately the hype is real,” says Benjamin Schroder of Meanwhile Drinks, the company behind new brand Pensador. “In terms of cultivated agave, the challenge is keeping prices stable, which are currently spiralling out of control, unaided by increasing demand for agave sugars and syrups, whereas with wild strains we are faced with the more serious concern of losing species all together.”

PRICE HIKES

“The price of cultivated Espadin agave has more than doubled since we started production just 18 months ago, from fivepesos per kilo to between 11 and 13,” says Shepherd.

Rexer, while acknowledging that supply is an issue, is optimistic for the future. “There is now an economic incentive for Oaxacans to plant and cultivate agave. Over the past three years, as agave prices have climbed, growers have been planting aggressively,” he says. “If anything, the current price bump and tight supply is a healthy growing pain as mezcal establishes itself and grows outside of Mexico.”

While mezcal producers have been doing what they can to keep up with demand, the CRM has introduced a new set of regulations entitled NOM 70, which now divides mezcal into three categories – mezcal, mezcal artisanal and mezcal ancestral – each with their own requirements when it comes to production methods.

“For good reason, people want to know where products are sourced from, how they are made, as well as what impact that has on communities and the environment,” says Rexer. “With NOM 70 at least some of this is achieved.”

Pedroso says: “This standard strengthens, revalues and protects the artisanal production of a beverage that has a history of more than 500 years. In addition, it encourages the conservation of wild species of agave and sustainable production by forcing producers to certify their maguey lands.”

Beveland Distillers’ marketing manager Jordi Xifra is also optimistic about the new regulations. “This is a positive change as this kind of development helps to build mezcal as a category,” he says.

Mezcal is literally redefining itself as it establishes itself around the world, facing no shortage of challenges but, equally, with everything to play for.