At 6.9% CAGR, South & Central America Tonic Water Market is Projected to be Worth US$ 123.17 Million by 2031, says Business Market Insights

According to Business Market Insights’ research, the South & Central America tonic water market was valued at US$ 72.47 million in 2023 and is expected to reach US$ 123.17 million by 2031, registering a CAGR of 6.9% from 2023 to 2031. Preference for low-sugar tonic water and innovations in flavors are among the critical factors attributed to drive the South & Central America tonic water market growth.

As more consumers become health-conscious and seek to reduce their sugar intake, the demand for low-sugar or zero-sugar beverages has surged. Low-sugar tonic water offers consumers a lighter and healthier option without compromising flavor or quality. Key players in the tonic water market engage in adopting strategic initiatives such as product launches and development to cater to the growing demand for low-sugar tonic water. In August 2021, Nexba made the Nexba Sugar-Free Tonic Water available in two flavors: lime, cucumber, and mint; and classic tonic. The launch was aimed at catering to the growing demand for low-sugar tonic water. Moreover, the rise of wellness-focused lifestyle and dietary trends, such as keto, paleo, and low-carb diets, propels the demand for low-sugar tonic water. Low-sugar tonic water provides a guilt-free option for consumers looking to enjoy their favorite cocktails without the excess calories and sugar content typically found in traditional tonic water. Thus, the surging demand for low-sugar tonic water is expected to become a key trend in the tonic water market in the coming years. This trend is particularly pronounced among millennials and Gen Z consumers, who prioritize health and wellness in their purchasing decisions and seek transparency in product ingredients.

On the contrary, the availability of substitutes hampers the growth of South & Central America tonic water market.

Based on type, the South & Central America tonic water market is bifurcated into plain and flavored. The flavored segment held 68.3% market share in 2023, amassing US$ 49.47 million. It is projected to garner US$ 85.20 million by 2031 to register 7.0% CAGR during 2023–2031.

In terms of category, the South & Central America tonic water market is bifurcated into low/no sugar and regular. The regular segment held 68.5% share of South & Central America tonic water market in 2023, amassing US$ 49.62 million. It is anticipated to garner US$ 83.00 million by 2031 to expand at 6.6% CAGR during 2023–2031.

By end user, the South & Central America tonic water market is bifurcated into on-trade and off-trade. The off-trade segment held 60.9% share of South & Central America tonic water market in 2023, amassing US$ 44.11 million. It is projected to garner US$ 73.66 million by 2031 to expand at 6.6% CAGR from 2023 to 2031.

Based on country, the South & Central America tonic water market is categorized into Brazil, Argentina, Chile, and the Rest of South & Central America. Our regional analysis states that Brazil captured 47.5% share of South & Central America tonic water market in 2023. It was assessed at US$ 34.38 million in 2023 and is likely to hit US$ 55.77 million by 2031, registering a CAGR of 6.2% during 2023–2031.

Key players operating in the South & Central America tonic water market are The Coca-Cola Co, Fever-Tree Drinks Plc, Thomas Henry GmbH, East Imperial Beverage Corp, and Britvic Plc., among others.

• In April 2022, Fever-Tree introduced a limited-edition summer tonic water featuring passionfruit and lime flavors. The water is free from artificial flavors and sweeteners, with 18 calories per 100ml, and can be paired with gin, vodka, or ice.
• In September 2022, Britvic mixers introduced two new flavors, Green Apple and Pink Lemonade, exclusively in Brazil. This fruity innovation is set for all seasons and follows the global brand's successful entry into the flavored tonic market.

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