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The arak market size is forecast to increase by USD 2.59 billion and is estimated to grow at a CAGR of 3.27% between 2023 and 2028. The global arak market is experiencing significant growth, driven by an increasing number of distilleries and a surge in exports. This trend is particularly noticeable in countries like Iran, Iraq, and Syria, which are major producers and consumers of this traditional Middle Eastern beverage. Additionally, the growth of global online retail platforms has facilitated the accessibility of arak to a wider consumer base, leading to a change in consumer behavior and lifestyle. Arak is no longer confined to traditional markets; it is increasingly being appreciated and consumed in Western countries, particularly among diaspora communities and adventurous food and beverage enthusiasts. This shift in market dynamics is expected to continue, fueled by ongoing innovation and the introduction of new product offerings in the market.
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Arak is a popular Middle Eastern anise-flavored distilled spirit, traditionally made from grapes, Anise seeds, and Jorda (wheat or barley). The production process involves distillation of the fermented grape juice, resulting in a strong, citrusy flavor. The Alcoholic beverage sector has seen the market developing significantly in recent years, with various producers, wholesalers, and retailers catering to the growing consumer preferences. The market's growth can be attributed to the unique taste and cultural significance of Arak in various regions. However, regulatory procedures and production costs pose challenges for market growth. In the product type segment, Merwah grapes are commonly used due to their high sugar content and favorable taste. Arak is primarily consumed in nightclubs and liquor stores, with the Middle East and North Africa being the major consumers. Producers are focusing on product innovation to cater to changing consumer preferences and expand their market reach. Grains such as wheat and barley are also used in the production of Arak, adding to the market's diversity. Overall, the Arak market is expected to continue its growth trajectory in the coming years, driven by consumer demand and product innovation. Our researchers analyzed the data with 2023 as the base year, along with the key drivers, trends, and challenges. A holistic analysis of drivers will help companies refine their marketing strategies to gain a competitive advantage.
Increasing number of distilleries and growth in exports of arak is notably driving the market growth. The global arak market is experiencing growth due to the rising number of distilleries producing this distilled spirit in countries like the US and the UK. For instance, Miami Arak, a distillery based in Miami, has announced its plans to expand both domestically and internationally.
Similarly, Rechmaya Distillery in Lebanon has announced an increase in their export of spirits, including arak, to the US. This trend is driven by the increasing consumer preferences for original flavors, such as those found in arak, which is made from grapes and anise seeds. Arak is a popular alcoholic beverage in the Middle East and North Africa, and its production costs are relatively low compared to other distilled spirits due to the use of grapes and grains. Thus, such factors are driving the growth of the market during the forecast period.
Growing online sales is the key trend in the market. Arak, a distilled spirit popular in the Middle East, is traditionally made from grapes and anise seeds. Jorda, a type of arak, is known for its citrusy flavor. The production costs of arak can be high due to the use of quality grapes and artisanal production methods. As the alcoholic beverage sector continues to develop, small producers of arak are finding new ways to reach consumers.
Moreover, nightclubs and liquor stores are common outlets for arak sales, but regulatory procedures can pose challenges. In the product type segment, Merwah grapes are often used to produce high-quality arak. Producers, wholesalers, and retailers are adapting to consumer preferences by offering original flavors and sustainable business methods. Thus, such trends will shape the growth of the market during the forecast period.
Fluctuations in raw material price is the major challenge that affects the growth of the market. The production of arak, a popular distilled spirit in the alcoholic beverage sector, relies heavily on the availability and cost of raw materials such as grapes and anise seeds. Producers face challenges in managing production costs due to fluctuations in the prices of these essential ingredients.
Moreover, natural disasters and adverse weather conditions, including heavy rainfall, drought, flood, earthquake, frost, and pestilence, can cause damage to grape crops and anise fields, impacting the supply and quality of these raw materials. Arak's unique taste profile, characterized by a citrusy flavor derived from grapes and a distinct aniseed taste, makes it a preferred choice among consumers. Hence, the above factors will impede the growth of the market during the forecast period
The market forecasting report includes the adoption lifecycle of the market, covering from the innovator’s stage to the laggard’s stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their market growth analysis strategies.
Customer Landscape
Companies are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.
Chateau Ksara: The company offers arak products such as Chateau ksara ksarak arak 750ml.
The market research and growth report also includes detailed analyses of the competitive landscape of the market and information about key companies, including:
Qualitative and quantitative analysis of companies has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize companies as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize companies as dominant, leading, strong, tentative, and weak.
The grapes segment is estimated to witness significant growth during the forecast period. The market is primarily driven by the use of grapes as the primary raw material in its production. This distilled spirit, native to the Middle East and North Africa, is derived from grapes, anise seeds, and sometimes grains. The production process involves several stages, including primary and secondary fermentation, pressing, and distillation. The market for arak is growing due to its popularity in countries such as Lebanon, Syria, Israel, and Iraq, where it is a significant alcoholic beverage sector.
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The grapes segment was the largest segment and valued at USD 7.35 billion in 2018. Anise seeds are also used in the production of arak, contributing to its unique citrusy flavor. Producers, wholesalers, and retailers are developing innovative product types and packaging ideas to cater to evolving consumer preferences and legal frameworks. The economic variables, including the increasing number of nightclubs, liquor stores, bars, pubs, travel retail, and bartenders creating new cocktails, are also driving the growth of the arak market. Hence, such factors are fuelling the growth of this segment during the forecast period.
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Middle East and Africa is estimated to contribute 48% to the growth of the global market during the forecast period. Technavio’s analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period. Arak Market is a significant segment of the alcoholic beverage sector, particularly in regions where grapes and anise seeds are cultivated. The production of this distilled spirit involves the use of grapes, which undergo fermentation, followed by distillation using grains. The addition of anise seeds imparts a citrusy flavor to the final product. As the market develops, regulatory procedures continue to evolve, ensuring a legal framework for producers, wholesalers, and retailers. Hence, such factors are driving the market in the region during the forecast period.
The market research report provides comprehensive data (region wise segment analysis), with forecasts and estimates in "USD billion" for the period 2024 to 2028, as well as historical data from 2018 to 2022 for the following segments.
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Arak, a popular Middle Eastern distilled spirit, is primarily made from grapes and anise seeds. The production of Arak involves the fermentation of grapes, followed by distillation with anise seeds. The result is a unique liquor with a citrusy flavor and a distinct anise aftertaste. The Arak market is developing rapidly, driven by consumer preferences for original flavors and sustainable business methods. Producers are focusing on reducing production costs and adhering to regulatory procedures to meet the demands of wholesalers and retailers. Nightclubs and liquor stores are significant channels for Arak sales, with younger drinkers increasingly drawn to the spirit's distinctive taste. Social media plays a crucial role in marketing Arak, with bartenders and cocktail enthusiasts showcasing innovative recipes and ideas. The Alcoholic beverage sector is a significant contributor to the Arak market's growth. Grains are also used in the production of some Arak varieties, adding to the market's diversity. The regulatory framework for Arak production varies from country to country, with economic variables and legal considerations influencing production methods. Artisanal production methods are gaining popularity, with consumers seeking authentic, original flavors. Packaging ideas and sustainable business methods are essential considerations for Arak producers looking to appeal to modern consumers. The market is segmented based on product type, including Merwah grapes Arak and Citrusy flavor Arak. Arak is sold in residential, commercial, and travel retail settings, including liquor shops, bars, pubs, and travel retail outlets. The market is expected to continue growing, driven by consumer demand and product innovation.
Market Scope |
|
Report Coverage |
Details |
Page number |
128 |
Base year |
2023 |
Historic period |
2018-2022 |
Forecast period |
2024-2028 |
Growth momentum & CAGR |
Accelerate at a CAGR of 3.27% |
Market growth 2024-2028 |
USD 2.59 billion |
Market structure |
Concentrated |
YoY growth 2023-2024(%) |
3.13 |
Regional analysis |
Middle East and Africa, North America, Europe, APAC, and South America |
Performing market contribution |
Middle East and Africa at 48% |
Key countries |
Lebanon, US, Jordan, Canada, and Japan |
Competitive landscape |
Leading Companies, Market Positioning of Companies, Competitive Strategies, and Industry Risks |
Key companies profiled |
Chateau Ksara, Domaine des Tourelles, El Massaya, Haddad Distilleries, Kawar Arak, Lebanese Arak Corp., Lebanese Fine Wines Ltd., LibanonWeine, and Zumot Distilleries |
Market dynamics |
Parent market analysis, market report |
Customization purview |
If our report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation by Raw Material
7 Customer Landscape
8 Geographic Landscape
9 Drivers, Challenges, and Opportunity/Restraints
10 Competitive Landscape
11 Competitive Analysis
12 Appendix
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