Canned Cocktails Surge While Scotch Takes a Body Blow in U.S. Control States
The American spirits landscape is undergoing a structural realignment that should concern every importer, distributor, and brand manager who has staked significant shelf space on Scotch whisky. Fresh data from the National Alcohol Beverage Control Association tells a stark story: while canned ready-to-drink cocktails are posting eye-popping double-digit gains month after month, Scotch is bleeding volume and value in nearly every government-controlled market in the country. May 2026 may prove to be one of the most telling single months in recent spirits history — not because of any single dramatic event, but because the numbers quietly confirm a consumer migration that has been gathering speed for the better part of three years.
What the NABCA Numbers Actually Say
Canned cocktails soared by almost 22% in both volume and value in U.S. control states last month. According to NABCA data covering 18 markets, the cocktails category — which includes canned ready-to-drink products — jumped 21.8% in volume compared to May 2025, while the value side of the ledger rose by 21.7%. Those are not the numbers of a category having a good quarter. Those are the numbers of a structural shift.
Growth in cocktails was actually lower than the previous month — in April, volume and value sales were up by a full third. That context matters enormously. According to NABCA data, the cocktail category grew by 34.7% in volume and 33.1% in value across 18 control jurisdictions in April compared to the same month in 2025. The category cooled only slightly from an extraordinary April sprint to an almost-as-extraordinary May performance. That kind of sustained momentum in a contracting overall market is nearly unprecedented.
The flip side of that coin has a Scottish tartan pattern. NABCA noted that Scotch whisky continued to decline in nearly all states, except for Oregon, falling by 8.1% in volume and by 7.9% in value across all markets in May. Strip away the geographic exception of Oregon, and you have a category in near-universal retreat across the American control state system — the very system that, in theory, should provide some insulation against impulse-driven consumer trends because purchasing decisions run through state-controlled retail environments.
The Broader Spirits Wreckage
Scotch is not suffering alone, though it is suffering more sharply than most. Canadian whisky suffered the biggest value decline of all spirits categories in May, down 9.5%, while rum fell 7.3% in value and Irish whiskey and brandy/Cognac both dropped 6%. Total spirits sales in May saw a 1.7% drop in volume and a 4.4% value fall, and over the 12 months to May 2026, volume was down 1.1% while value decreased by 3.1%.
Looking at the state-by-state breakdown, only Michigan, Mississippi, Iowa, and North Carolina grew their spirits volumes in May. By value, only Mississippi saw an uptick in spirits sales, rising by 5.6%. That is an almost complete sweep of red ink across the map. In the on-premise channel during May, spirits sales declined by 3.1% in volume and by 5.2% in value, with most states reporting decreases, though Idaho, Michigan, and North Carolina were exceptions. Over the last 12 months, spirits sales in the on-trade saw only a minor 0.4% rise in volume while value dipped by 1.7%.
Even tequila — the category that carried American spirits on its back for the better part of a decade — is visibly slowing. Tequila reported a 0.2% drop in volume for May and a 4.2% decrease in value. That value decline tells a story about the limits of premiumization as inflation-weary consumers dial back their spending on high-proof luxuries.
Scotch's Rough Road Through 2026
For anyone tracking Scotch in American control states over recent months, May is not an anomaly — it is a continuation. The largest volume drop in April also came from Scotch, which fell 9.8%, a decline the NABCA attributed to less promotional activity in New Hampshire. February offered a brief reprieve. NABCA data showed Scotch managed to overturn declines from previous months in February, with the category seeing sales grow by 4.5% in volume while value rose by 1.9% — a gain the NABCA attributed primarily to New Hampshire, which was up 152%, supported by strong promotional activity. That kind of single-state distortion — New Hampshire is one of the highest-volume control states due to its low tax structure and cross-border shopping traffic — can temporarily obscure a deeply negative underlying trend. When that promotional push fades, the broader reality reasserts itself, as May's numbers confirm.
Scotch's American problems did not appear overnight. After years of riding a premiumization wave, Scotch exports weakened, with the Scotch Whisky Association reporting an 18% drop in export value in the first half of 2024, with volume down roughly 10%. Export value to the U.S. declined slightly by 0.7% in 2024 to £971 million, even as export volumes into the U.S. market actually increased by 3.7% to 132 million bottles — a painful combination that indicates falling prices and deteriorating margins even as more product physically crosses the Atlantic.
Tariffs Layer On Additional Pressure
Trade policy has compounded the headache for Scottish distillers trying to stabilize their American foothold. The first rumblings of tariff news came in late 2024, with the sector spending all of 2025 in Trump's shadow. As things stand, the UK is subject to a 10% tariff on goods exported to the U.S., which the SWA estimates is costing the sector £4 million per week. That weekly toll is not absorbed by the brands — it gets passed along in some form to distributors, retailers, and ultimately to the consumer who is already being asked to pay more for a category experiencing diminishing cultural cachet among younger drinkers.
Whether due to tariffs or other factors, the impact has already begun to be felt by Scotch producers, with some openly announcing production pauses. Brown-Forman's Glenglassaugh switched to a shared production model with BenRiach in January, while the Isle of Harris Distillery followed up with a pause and job cuts in April. InchDairnie, which debuted its inaugural single malts in May and had announced a doubling of its production capabilities last year, had to reverse course and make job cuts in October, citing a decline in global demand for whisky. These are not fringe operators — they represent some of Scotland's most talked-about new wave distilleries.
RTDs: The Category That Is Eating Everyone's Lunch
Understanding what is happening to Scotch requires understanding what RTDs have become in the American market. These are no longer the sugary malt-based hard seltzers of 2019. The segment has matured and fragmented in ways that now put it in direct competition with traditional spirit categories across multiple consumption occasions.
The RTD category's composition has shifted significantly, with a 5% drop for malt-based options while spirit-based RTDs grew by 14%. Spirit-based RTDs — those made with actual distilled spirits rather than fermented malt beverages — carry a different value proposition than White Claw ever did. They offer the credibility of a real spirit, the convenience of a can, and a price point that competes favorably with a $60 single malt in a tough economy.
Beer, wine, and spirits volumes all contracted versus 2024, with RTDs the only major category to see growth, and wine volumes fell below spirits for the first time. The clearest bright spot for beverage alcohol in 2025 was RTDs, which grew volumes by 3% despite a fall in the dominant U.S. market — the first annual decline since 2015. Nonetheless, premium-and-above RTD volumes rose by more than 15%, and the U.S. still accounts for about 40% of total global category volumes. The premiumization of RTDs is arguably the most significant structural development in the category — it removes one of the last remaining objections that traditional spirits drinkers had to the format.
The booming growth of spirits-based RTDs nationwide is the industry's biggest growth catalyst in decades. RTDs continue surpassing other categories in overall sales, and in control states RTD sales were greater than those of Scotch, gin, and Irish whiskey combined last year. Spirits RTDs are primarily driven by vodka- and tequila-based products, though whiskey-, rum-, and gin-based offerings are also in the mix.
Why Younger Consumers Are Choosing Cans Over Scotch
The consumer psychology at work here is not complicated, but it deserves to be stated plainly. "2025 was a more challenging year for spirits," says Mitch Madoff, head of retail partnerships at Keychain in New York. "After several years of steady premium-driven growth, the market felt real pressure from inflation, tighter consumer budgets, and a shift in consumer behavior, as more people chose to reduce or eliminate alcohol altogether." Yet within that contraction, RTDs thrived. Madoff notes that their variety of flavor options and on-the-go convenience align with younger consumers who are seeking flavorful, lower-sugar, lower-carb options that match their functional and better-for-you preferences.
There is also an accessibility dynamic that the Scotch industry has long struggled with. A bottle of Johnnie Walker Black runs $35 to $45 in most control state stores. A four-pack of a premium spirit-based RTD runs $14 to $18, provides a defined, consistent drinking experience, requires zero skill or glassware, and travels in a bag or a cooler. For a 26-year-old navigating a high cost-of-living environment, that calculus is not irrational.
More than half of dark spirits consumers find them too expensive for regular use, and many would switch brands if tariffs increase prices, according to Mintel's 2025 "Dark Spirits – US" report. The report recommends offering smaller bottle sizes, promotions, or entry-level premium options to address affordability concerns without compromising perceived value. Scotch, as a category, has been slow to embrace this advice. Its brand equity rests on aged expressions, craft narratives, and heritage — powerful attributes that carry diminishing weight with price-sensitive consumers who can grab a perfectly serviceable canned whisky highball on their way out the door.
The Scotch Industry's Adaptation Problem
It is worth noting that some Scotch-affiliated brands have begun to respond to the RTD moment, though the initiatives remain small relative to the scale of the challenge. Cutty Sark, owned by French spirits firm La Martiniquaise-Bardinet, launched its first RTD — a Cutty Sark and Ginger Ale Highball — becoming the first blended Scotch whisky RTD in the U.S., with further rollouts planned in Canada, Bulgaria, and Portugal. The Highball format is a smart play — it mirrors the wildly popular Japanese whisky highball trend that has been quietly building momentum in American cocktail culture for the last several years.
The Rémy Cointreau-owned Bruichladdich brand is also launching a canned cocktail range in partnership with Whitebox, with the collection including a Dry Martini and a White Negroni made with The Botanist gin, a Whisky Sour made with the distillery's Classic Laddie, and a Penicillin made with the heavily peated Port Charlotte whisky. These moves signal that at least some Scotch producers understand the existential nature of the RTD challenge. But the volume contributions from these initiatives are, for now, minimal compared to the scale of what categories like High Noon and SipMargs are doing in the market.
As the only major alcohol category expected to grow in 2026, IWSR has heralded RTDs as a "beacon of hope" for the broader beverages industry, with the category expected to account for 4% of total beverage alcohol volumes in 10 key markets by 2029, up from 2% in 2019. In 2026, sharper consolidation is anticipated — top-performing brands with clear identities will pull ahead, while weaker or copycat offerings may fall away. More segmentation is also expected, including premium craft RTDs, functional or low-ABV formats, darker and more complex flavor profiles, and crossover products from established distilleries. That last point is precisely where Scotch brands should be focusing energy and capital.
Control States as a Bellwether
It matters that these numbers are coming from control states specifically. There are 17 control states and three jurisdictions in the United States where the government plays a direct, hands-on role in the sale and distribution of alcohol. These markets are characterized by more deliberate purchasing decisions, less impulse buying at gas stations and convenience stores, and a customer base that skews slightly older and more intentional in its spirits choices. If Scotch is getting hammered even in these more considered retail environments, the numbers in open markets are almost certainly worse.
Control state data also provides some of the cleanest apples-to-apples comparisons available in American spirits retail, because state control boards maintain detailed records that private retail chains typically guard jealously. Faced with growing challenges to consumers' discretionary income, spirits volume and value decreased overall in control states last year, down 1.4% to 60.4 million 9-liter cases and 2.8% to $13.2 billion respectively. Explosive sales growth from spirits-based RTDs — up 22.6% to $434.4 million — and a modest tequila gain weren't enough to offset declines in all other spirits categories.
David Jackson, COO at NABCA, says that "suppliers have gone from focusing on growth to focusing on share, especially the publicly traded companies," and notes that spirits consumption faces growing pressure from multiple factors, including health issues and the growing use of GLP-1 weight loss drugs, Gen Z not drinking as much as other generations, and the popularity of Delta-9 THC beverages. That is a remarkably candid assessment from the head of the trade body that oversees these markets — and it explains why the competitive dynamics are becoming so ruthless. In a market that is no longer growing, every case of RTDs sold is, functionally, a case of something else not sold.
The Wider Whiskey Market in Context
American bourbon has not escaped the broader pressure, though its declines are more modest and its long-term structural position is considerably stronger than Scotch's. American whiskey's volume grew rapidly through 2019 to 2021 but turned slightly negative by 2024. Distillers expanded capacity massively during the pandemic and early boom years, and now many are feeling the first corrective market forces. Kentucky alone barreled roughly 2.7 million barrels of bourbon in 2022 — unprecedented levels. With demand stabilizing, the concern is that supply will outstrip near-term sales, creating downward price pressure.
Still, bourbon retains significant cultural advantages that Scotch currently lacks in the American domestic market. American whiskey, particularly bourbon and rye, is protected by federal standards of identity that mandate it be produced in the United States, fostering a strong sense of national pride and authenticity. The versatility of whiskey in both neat consumption and classic cocktails such as the Old Fashioned and Manhattan ensures its broad appeal across demographics. That domestic identity story is a powerful competitive moat — one Scotch, by definition, can never replicate on American soil.
Single-barrel bourbon releases and lotteries for allocated offerings continue to create consumer excitement and promote premiumization. "People are lining up for specialty bourbons," one NABCA executive notes. That kind of grassroots enthusiasm and scarcity culture — honed through years of Buffalo Trace lottery drops and Pappy Van Winkle hunts — is simply not being replicated in the Scotch single malt world with the same intensity among American consumers under 40.
Industry Implications and What Comes Next
The NABCA data for May 2026 is more than a monthly report card. It is a snapshot of what happens when a category built on deliberate, educated sipping encounters a market reshaped by convenience, value consciousness, and a generational shift in what "a drink" even means. As IWSR Managing Director and President Marten Lodewijks puts it: "The global beverage alcohol market is undergoing a major reset. Consumers aren't abandoning alcohol, but they are being more intentional about the frequency and intensity with which they drink it."
For Scotch, being more intentional often means choosing it less often. The category asks a great deal of a new drinker — the vocabulary of peated malts, age statements, regional character, and distillery heritage is a steep on-ramp for someone whose prior relationship with spirits began with a canned vodka soda. The industry has long relied on converts who discovered Scotch in their 30s after graduating from bourbon or Irish whiskey. That pipeline may be thinning as RTDs and flavored American whiskey products intercept those early-stage drinkers and hold them in the category.
Whiskey remains one of the world's most storied and popular spirits, but by 2024 the industry showed clear signs of growing pains. After decades of nearly uninterrupted expansion, sales growth has decelerated and cost pressures have risen, with raw materials, barrels, labor, and energy all more expensive and a cautious consumer climate blunting demand. Against that backdrop, the Scotch category faces a particularly difficult path: it cannot compete on price with domestic American whiskeys, it cannot match the convenience narrative of RTDs, and it is simultaneously absorbing tariff-driven cost increases that make its value proposition harder to defend at retail.
What the May numbers suggest is that the brands most likely to survive this period are those with genuine consumer loyalty among older, more affluent drinkers — the Macallans, the Glenfiddichs, the Laphroaigs — while mid-tier blended Scotch expressions that once captured the entry-level whisky drinker may find that consumer has simply migrated to a can. The question now is whether the industry moves fast enough, and boldly enough, to follow them there before the habits calcify into something permanent.
