Austin, Texas — Bottled water consumption was up slightly in 2023, according to new statistics from Beverage Marketing Corp.
Gary Hemphill, managing director with advisory firm BMC, told attendees of The Packaging Conference Feb. 12 in Austin the category grew by 0.5 percent in 2023, according to preliminary data. That's down from 1.1 percent in 2022 and much higher growth rates ranging from 3.7 percent to 6.1 percent annually from 2017 to 2021.
Higher prices and the segment's "mammoth size contributed to its modest growth," Hemphill said in his presentation.
Hemphill's bottled water category includes a half-dozen different sizes and is dominated by the single-serving size that's typically — but not exclusively — 16.9 ounces or a half-liter in size. "It's one of those situations as single-serve PET [container] segment goes, so goes the category to a great extent," Hemphill said.
Hemphill also told the conference crowd the volume of bottled water is projected to grow by 1-2 percent in 2024, and wholesale dollar growth is expected to be an estimated 3-4 percent.
Carbonated soft drinks, packaged in plastic and aluminum and sold as fountain beverages, is estimated to fall by 1 percent or stay flat for 2024 but is expected to experience 3-4 percent wholesale dollar growth this year.
This follows a half-percent increase in volume in 2023, according to preliminary figures, and a 0.7 percent increase in 2022 as well as 3.1 percent jump in 2021. Carbonated soft drinks sustained 16 consecutive years of volume contraction prior to 2021.
Bottled water's march to the top of the beverage category over time chiefly has come at the expense of carbonated soft drinks.
Bottled water, in total, measured nearly 16 billion gallons, widening its gap as the largest volume beverage consumed by American consumers in 2023.
"Bottled water keeps chugging along," he said, "but its growth has slowed a bit.
"It's a lot of liquid. And it's the largest amount any beverage category has ever achieved in the U.S. marketplace, and it continues to grow. But its growth has slowed a bit," Hemphill said. "Basically widening the gap between carbonated soft drinks, which is the second-largest category in the U.S."
The half-liter, single-serve PET container dominates the bottled water category with over 70 percent of the bottled water market share. "Really it's all about that single-serve PET market," he said.
Last year saw PET single-serve containers account for 71.1 percent of the bottled water market, down from 71.2 percent for 2022, but up from 69.2 percent in 2017, Hemphill indicated during his presentation.
Other categories of bottled water include containers ranging from 1 to 2.5 gallons in size, which had 7.2 percent of the bottled water share in 2023. That's down slightly from a 7.5 percent share in 2022 and 8.7 percent in 2017.
Only bottled water and energy drinks experienced volume growth in 2023 in the refreshment beverage category, according to preliminary statistics that will be updated when fourth-quarter numbers are included, Hemphill said. Refreshment beverages include bottled water, carbonated soft drinks, energy drinks, ready-to-drink coffee and tea, sports drinks and fruit beverages. The category excludes alcohol, hot coffee, hot tea and milk.
Hemphill also reported on the use of plastics for all beverage packaging made in the United States last year.
Metal, plastic and glass account for more than 90 percent of all beverage packaging in the United States, with plastic accounting for 46.3 percent of the total in 2023, the same number posted in 2022 and higher than a 44.9 percent share in 2017.
Metal cans had a 38.6 percent share in 2023, up from 37.4 percent in 2022 and 34.2 percent in 2017. Glass, meanwhile, had a 10.7 percent share of all beverage packaging in 2023, up slightly from 10.6 percent in 2022, but down from 13.9 percent in 2017. Paper checked in at 4.2 percent in 2023, up slightly from 4 percent in 2022, but lower than 2017's 5 percent share.
Hemphill said the overall beverage market has been soft over the past couple of years in the United States, including all beverages that people purchase. "I would say the last two years, in particular, have been impacted by higher prices," he said.
Total U.S. beverage volume fell by 0.5 percent in 2022 and another 1.1 percent in 2023, according to preliminary figures. Those dips followed a 2 percent increase in 2021. As overall purchased beverage volume fell, the consumption of tap water increased last year.
"It's really a story of inflation. I think [in] 2024 we'll get back closer to historical norms," he said. "Between COVID, inflation, supply chain issues, a lot of factors [are] at work here.
"Really remarkable performance when you consider the size of the category from 2017 to 2021. The pandemic seemed to have very little impact one way or another on bottled water," Hemphill said.