Caipi Invasion: Brazil’s Cachaça Re-Debuts in US

Bartenders will be mixing a lot more caipirinhas this summer following a big push by Brazil to expand the market for cachaça in the United States now that the spirit can be sold under its Portuguese name and is officially a “distinctive product of Brazil.” (Photo by Sofia Perpetua)

Brazilians are investing in a strong and fierce marketing campaign to promote their national spirit, cachaça, the main ingredient of caipirinha, in the United States. These days, even in the award-winning television series “The Big Bang Theory” there are cachaça bottles on display.

Product placement is part of the plan to increase exports to the American market and will be followed by television and magazine ads, online videos and social media campaigns all set to coincide with Brazil taking center stage in 2014 with the soccer World Cup and in 2016 with the Olympic Games both being held in Rio de Janeiro.

“A world of opportunity just opened up before us. The focus is on the American market now,” said Dival Ramiro, a cachaça importer in New York. “The marketing campaigns are targeting the American consumer, not the Brazilian people anymore.”

The sudden excitement is the result of a rebranding made possible after the U.S. Alcohol and Tobacco Tax and Trade Bureau, following more than a decade of pressure from the Brazilian government and importers, amended its regulations earlier this year to recognize cachaça as a  “distinctive product of Brazil.” Cachaça will now have to be made in Brazil according to the local production and quality criteria. Just like champagne has to be made in France, Tennessee whiskey in the U.S. and tequila in Mexico, for example.

Up until now cachaça, the world’s third most popular spirit according to a study by American University, could not be labeled under its Portuguese name but as “Brazilian rum.” The main difference between both spirits is that cachaça is made of fermented and distilled sugarcane juice while rum is usually made from molasses.

From 700,000 liters of cachaça currently exported to the U.S., Brazil is hoping the new designation will push that number up to more than 5 million liters a year in the next decade. In 2012, cachaça sales to the U.S. totaled $2 million, about 10 percent of all cachaça exports, according to the Brazilian Cachaça Institute (Ibrac).

“You want to make a point of establishing this distinctiveness of your product so you can charge a higher price and develop a market for it,” said Dean Baker, economist and co-director of the Center for Economic and Policy Research, about the ruling on cachaça. “It wouldn’t surprise me to see some big companies get in the game and try to expand the market.”

In New York, along with Brazilian restaurants like Plataforma, Beco, Esperanto or Miss Favela, where caipirinhas were always served, bottles of cachaça are becoming common at other bars and restaurants.

“I make a couple of caipirinhas every night,” said of the famed cachaça, lime, sugar and ice cocktail Soninha Barros, bartender at Giorgione, an Italian restaurant. “I’m planning on making dozens of caipirinhas during the soccer World Cup next year!”

Brazil produces 1.2 billion liters of cachaça every year and only 1 percent of it is exported. The U.S. is the fourth largest importer of cachaça, after Germany, Portugal and France.

Tavares de Almeida, the company that owns Velho Barreiro, one of the most popular cachaça labels in Brazil, claims that international investors have been contacting them and are interested in knowing more about the market.

Purissima do Brasil, a cachaça exporter in Brazil, predicts that its sales will triple in the next year after the U.S. ruling.

“The United States is very interested in our cachaça,” said a representative from Purissima do Brasil.

Leblon, a cachaça label popular in the U.S., has been targeting American consumers for the past few years with a strong promotional campaign and the “legalize cachaça” movement that fought for the drink’s newfound recognition as a distinctive Brazilian product. The push went as far as collecting 300,000 signatures in the U.S. on a document they called “Cachaça Declaration of Independence” and conducted 500 rallies nationwide. Leblon claims to have transformed cachaça into an “exotic luxury import.” A 750ml bottle sells for about $32 in the United States.

A study made by the Brazilian Tourism Institute in the U.S. last year reveals that 21 percent of Americans can name caipirinha as a typical Brazilian product. In the last decade, more cachaça labels like Leblon and Cachaça 51 have reached the American market.

“We have been selling a lot of cachaça in the past few years,” said Jose Conceicao, owner of Lisbon Wines & Liquors in Newark, N.J. “We sell a lot in the winter, people like to stay warm.”

After the recognition of cachaça in the U.S.,  Brazil is looking for the European Union to follow through with a similar ruling but the process is still in its infancy.

“Cachaça was born along with Brazil and represents our culture since the 16th century,” said Vicente Bastos Ribeiro, president of Ibrac. “Success in the U.S. will help us expand the sale of cachaça to the whole world.”

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