A strong off-trade performance has dragged the UK alcohol market back into volume growth for the first time in five years, according to a report from the Wine & Spirit Trade Association.

But the on-trade is still struggling to keep up, even though the pace of decline in pubs, bars and restaurants has slowed, said the report.

The WSTA described the overall picture as “positive” but said that the market remains fragile with tough trading conditions in many categories.

Total wine volumes were down 2% on the same time last year, and the category has shown no growth since 2010, with volumes dropping 15% over that time, as first reported in OLN’s sister magazine Harpers.

Both volume and value in the off-trade grew by 2% for total alcohol, led by sparkling wine (+28%), beer (+3%), spirits (+3%) and Champagne (+2%).

Off-trade spirits growth was fuelled by rum and tequila (both up 8%) and gin and liqueurs (both +7%).

Fortified wine (-5%), still wine (-2%) and cider (-1%) all declined.

Australia saw volumes grow 4% to extend its lead at the top of off-trade volume chart over Italy in second place. Italy had volume decline along with the next four biggest supplying countries: the US, France, South Africa and Spain.

Argentina overtook Germany to take ninth place on the volume chart.

Total on-trade alcohol volumes were down 2%, though the value of sales increased by the same amount.

Wine and spirits were both down 3% and beer by 2%. Tequila (+16%) and gin (+10%) were the only major spirits categories to see on-trade growth.

New Zealand (+20%) and France (+3%) were the only top 10 supplying countries to achieve an increase in volumes in the on-trade.

Sparkling wine was up 20%, while port and sherry producers will be buoyed by a 5% increase for fortified wine. Cider rose 1%.

WSTA chief executive Miles Beale said the impact of lower duty in some categories was making a positive impact.

“It is clear that the retailers and producers are passing these on and that consumers are finally getting the break they deserve after years of inflation-busting tax rises,” he said.

“While this is a positive development, the market remains fragile and a recovery unsure, with volume growth very low.

“The levels of taxation for the wine and spirit trade remain high in absolute terms. As we see the benefits of lower food and fuel prices beginning to recede there is a real prospect that the market could tip back into decline.”

He argued that wine had not seen the positive trends of other categories because it had not benefited from the same duty cuts.

“Although the freeze on wine duty was an improvement, the WSTA will continue to make the case to government for equal support for the wine industry and the 270,000 jobs in the UK that it already supports,” Beale said.

On-trade figures are CGA for the year to April 18 and off-trade Nielsen for the year to March 28.