# Teamsters Push a 75 Percent Tariff on Mexican Beer Aimed at Constellation - Vice & Wellness: Alcohol & Nicotine - July 29, 2026 > Vice and Wellness (alcohol and nicotine) newsletter for July 29, 2026. A Teamsters-backed petition seeks tariffs of up to 75 percent on Mexican beer, aimed squarely at Constellation Brands, while two former Constellation executives argue the alcohol moderation wave is structural rather than cyclical, Philip Morris beats on its smoke-free portfolio, and the FDA commissioner resigns over flavored vapes. ## Vice & Wellness: Alcohol & Nicotine ### July 29, 2026: Teamsters Push a 75 Percent Tariff on Mexican Beer Aimed at Constellation --- Two weeks ago the loudest voice in beverage alcohol said the slump was cyclical and the stocks were oversold. This week two people who used to run Constellation Brands sat down and said, politely but firmly, no, a big chunk of this is permanent, and the industry is fooling itself. That argument alone would make the week. Instead it got buried under a trade petition that could put a 75% tariff on Mexican beer, a Philip Morris quarter that blew past expectations, and an FDA commissioner walking out the door over flavored vapes. ## TL;DR - **The Teamsters are backing a petition asking Washington for tariffs of up to 75% on Mexican beer.** Imports are one of the only growing parts of the beer aisle, and "the Mexican beer import category in the US" is essentially Constellation Brands, Modelo, Corona, Pacifico, Victoria. Distributors on the podcasts think it would shrink the category rather than shift volume to domestic brewers. - **Philip Morris delivered a big quarter and the market took a minute to figure it out.** Revenue up 10% against expectations of 5%; earnings per share up 15% against expectations of 7%. The stock initially fell in pre-market trading because the company trimmed its guidance, but only for currency swings, not for the underlying business. - **The alcohol debate flipped sides.** Jon and Matt Moramarco of the data firm BW166, a former Constellation Brands CEO and a former Constellation data-science chief, respectively, argue the moderation wave is "far more structural than cyclical." Their headline number: servings drank fell about 6% last year, while the share of adults who drink at all barely moved. People aren't quitting. They're just drinking a lot less. ## What's new **A 75% tariff on Mexican beer is now a live request in Washington, and it points straight at Constellation.** The item came up on [Tapped In Sales and Strategy for Beer Distributors, "119: Just Enough to Get Invited Back Tomorrow" (Jul 28, 2026)](http://url7324.matterfact.com/ls/click?upn=u001.idHmPrr2Geh7KYLAsTy7NkrIVb-2FgA4pmf2rMXQwGcOjXC7bRu-2Bd2xj63loFZ0WmyObhwtOLA3-2BTlOcMR01ndiTNYqEQG7RORxURvN30Peb7bVRpUODtzhNvWAxLVHgnD7KFQdZ39G4OtmRaHXxqo9A-3D-3D8Obr_7mLGwmUci-2BLaXswv9WX1yTgqn3Wad-2FotHhzHgSNAZbVbmQqy3GmPCN6ffbfowwrj8ylGzqn9-2FOw8zwtPmvLrg4Q-2Fkj1ZQUhFCug-2BTgbTUKRfsYvTNE9vY7-2FONZr8mBvd3UctMoS7xKc1r-2FjOZaDjNctnkRGqz5j6pJiuAU9Ee-2BSD7EtF2ndehPFKxcBZK6GygUgXwaWMVntO-2BOBgfoTN-2FQ-3D-3D), where the hosts flagged that "the Teamsters are getting involved on advocating for tariffs, looking for a tariff on Mexican beer specifically... They publicly backed rates as high as 75%." Their read on who it hits: "Imports are one of only a few categories growing in the beer segment with Modelo Pacifico and Victoria. I mean, basically this is a tariff targeted at Constellation, right? Like this is, you know, that they are the Mexican beer import category in the US." Then they took apart whether it would actually work. One host argued the Modelo drinker is insulated, "I don't know if there's a lot of pricing sensitivity with your classical Modelo drinker... I think they're more on the higher end of that K-shaped economy," a more premium buyer than a Busch Light or Miller High Life drinker. The others disagreed sharply. "I think that they are. I think everybody's really price conscious right now," one said, adding that for the Hispanic consumer in particular, a price increase "is not welcomed right now in an economy that's super tough. So I don't think that it would drive up domestic beer volume by that much. I really don't. I think that people would just reduce the amount of alcohol or the amount that they're drinking." That last sentence is the whole risk. In a category already leaking volume, a tariff doesn't reallocate drinkers to Bud Light, it removes occasions. As one host put it: "To me, I think it's a net drag on the category... Price consumers to a position of maybe they go try other things or don't drink alcohol at all... We've had enough disruption and changing behaviors in our beverage alcohol category and specifically beer since 2023. We don't need to welcome any more of it." > "Basically this is a tariff targeted at Constellation." (Tapped In, on the Teamsters-backed petition) Worth noting for balance: this is distributor commentary, and distributors have an obvious interest in cheap, plentiful imports. But their point about elasticity, that the marginal beer buyer today walks away rather than trades down, is the same point the volume data has been making all year. **Philip Morris put up a quarter that beat on both lines, and the initial sell-off was a misread.** On [Bloomberg Intelligence, "AT&T Reports Greater-than-Expected Mobile Subscriber Gains" (Jul 22, 2026)](http://url7324.matterfact.com/ls/click?upn=u001.idHmPrr2Geh7KYLAsTy7NkrIVb-2FgA4pmf2rMXQwGcOgtJAb6OVnpyyXR37WhlG9sj9FxRuVtfOIpOpOAt-2BbmUjCalkT6k9V-2BxJkpX8miIlWKgB1Vg-2BdK6y7SVD2ZzNve8xAYTS9ZN4sJ7r6v1qYpTg-3D-3DN-zv_7mLGwmUci-2BLaXswv9WX1yTgqn3Wad-2FotHhzHgSNAZbVbmQqy3GmPCN6ffbfowwrj8ylGzqn9-2FOw8zwtPmvLrg0P1BVJjsUQ8plFwRh4KCCghvJvatOhfWBOQO9RQ49Pm-2FjFigEkWtIYLObKQ87JRCywRsxi89AGqyRh1pr9XajkfLmrUgBvSh7VDah9eqCqWcxNS-2BCqva-2Bn0kd8Ri1z8lg-3D-3D), analyst Ken Shea, who has covered the company since before the Altria split, laid out the print: "Philip Morris's numbers today were really good. The headline numbers, top line 10%, beat 5% expectations. EPS up 15%. Expectations were for 7%." The shares were up about 1.65% on the day at a 52-week high, up 19% for the year, with a roughly 3% dividend yield. The interesting bit was the pre-market wobble. "Initially, despite those strong numbers, initially the stock in the pre-market was down and I was scratching my head," Shea said. The explanation: "they lowered their guidance on an after-currency basis. This company is very international, hence the name. And they said, look, you know, currencies are not going to be quite as favorable as we saw last quarter. But our adjusted currency numbers, we're still looking for high single-digit EPS growth. I think investors digested that. They got bullish again." Translation for anyone modeling this: the guidance cut was a foreign-exchange effect, not a demand or pricing problem. Strip out the currency and the company still expects high-single-digit earnings growth. Shea also flagged the next leg of the US story, Philip Morris already sells Zyn stateside under its agreement with Altria, "and soon they're going to launch their Heat Not Burn vapor product in the US, a big potential growth market." That US heated-tobacco launch is the catalyst to keep on the calendar. On why Zyn keeps working, Shea gave the cleanest plain-English version of the reduced-risk pitch I've heard on a podcast: "You get your nicotine buzz without the ire of your neighbor at work or on the subway or whatever, getting annoyed that you're smoking or vaping next to them. So it's a very discreet way of getting your nicotine and it's doing really well. A lot of smokers are switching over." He also confirmed the regulatory tailwind that landed earlier this month: the FDA "has granted it recently the authorization to promote it as a less harmful source of nicotine as opposed to cigarettes." **The FDA commissioner quit, and the reported trigger was flavored vapes.** This is the nicotine regulatory story of the week and it got almost no airtime in finance media. On [PopHealth Week, on the Healthcare NOW Radio Podcast Network, "A PopHealth Week Mid 2026 Review of Federal Public Health Infrastructure" (Jul 26, 2026)](http://url7324.matterfact.com/ls/click?upn=u001.idHmPrr2Geh7KYLAsTy7NkrIVb-2FgA4pmf2rMXQwGcOg-2BgZ6Q2uMKJZgin5k5GHHBoKMWY9oI5PpW80eqblZoBkvG5-2BO1w6hc6kl215-2BJA7iJua7cONKwgPofIFAKwVYDGjILjeCRO0oaBanME2qOyg-3D-3DycDR_7mLGwmUci-2BLaXswv9WX1yTgqn3Wad-2FotHhzHgSNAZbVbmQqy3GmPCN6ffbfowwrj8ylGzqn9-2FOw8zwtPmvLrg-2F6CY3eP4x3GNAVtV-2FoB0PLL1KTwjUTndBJY-2BKtW174qVjhyqp-2FmgxSsw9q6XBODu5LbJTZ278LH0Xpy35UGrlIKkEU8dVX0iugB4jzGed4UK9wFEOw5l6BtuX-2FqIP3mxg-3D-3D), hosts Gregg Masters and Fred Goldstein, president of Accountable Health LLC, discussed FDA Commissioner Marty Makary's resignation after 13 months. Masters was blunt about the cause: "The proximate cause, fruit-flavored vapes. I guess that was a bridge too far. The president wanted them approved. Macri's conscience wouldn't allow it." He added the political backdrop: "Trump literally campaigned in 2024 on saving vaping... The flavored vape approval was on the White House policy agenda from day one. Macri came in presumably knowing that. So what changed? What made this the line that he couldn't cross?" Why this matters for the reduced-risk trade: the entire competitive moat around Zyn, Vuse, NJOY and the rest is the FDA's product-authorization process, the multi-year, multi-million-dollar review that keeps unapproved products off legal shelves. A leadership vacuum at the top of the agency, combined with active White House pressure to approve flavored vapes, cuts in two directions. It could mean faster approvals for the big players' flavored products. It could equally mean a looser enforcement posture that lets illicit imports keep taking share. Either way, the agency setting the rules just lost its referee. The hosts also flagged the resourcing picture: a proposed $16 billion budget cut for fiscal 2027 on top of roughly 20,000 eliminated positions across the department. Goldstein's point about enforcement capacity generalizes uncomfortably well to illicit vapes: when the federal layer thins out, "the states had to step in or bring in private contractors." **The beer scan data is now negative in 13 of the last 15 weeks.** Also from the Tapped In episode, citing Circana data as reported by Beer Marketer's Insights through July 12: beer dollars down 1.1%, volume down 2.2%. "That's down 13 of the last 15 weeks. Only two positive weeks since Q2 started." Underneath that, the same handful of pockets keep growing and nothing else does. "The same four segments have grown across every time frame all year. Non-alcoholic up almost 18 percent. Super premium up almost eight. Cider up five. Who the hell is drinking all that cider? And imports up 0.2, so imports are flat." At the brand level: Michelob's non-alcoholic beer up 88%, Athletic Brewing up 16%, the broader Michelob Ultra family up 9%, and Yuengling with four straight growing weeks. Two things fall out of that. First, non-alcoholic beer at nearly 18% growth is no longer a rounding error, it is the single healthiest line in the beer business, and Michelob's 88% says the big brewers have finally figured out how to sell it. Second, note that imports are flat at +0.2%. That is the category the tariff petition would tax. Take the one flat segment in a shrinking aisle and add up to 75% to its landed cost, and you have a problem that isn't confined to Constellation's income statement. The host's own framing was more sober than any of the individual numbers: "We continue to see the same brands and the same categories of products succeed over and over again... This is a rising tide lifts all boats problem. Not a specific one player versus another player problem." ## The debate Two weeks ago this section was one-sided in the bulls' favor. Bernstein's beverages analyst made the case that the drinking decline is mostly an affordability problem, cyclical, fixable, and over-priced into the stocks. This week the other side showed up with data and credentials, and the exchange is now genuinely joined. **Bear, the moderation wave is structural, and the industry is in denial.** The heavyweight case came on [Business of Drinks, "126: How Drinks Brands Can Survive the Structural Reset With Jon and Matt Moramarco" (Jul 22, 2026)](http://url7324.matterfact.com/ls/click?upn=u001.idHmPrr2Geh7KYLAsTy7NkrIVb-2FgA4pmf2rMXQwGcOha1BTlQPxhOL0MSn1qgY7zLsZ-2Fz5OJS26prVnmCdzP8g1evXzbCIXQ1L6q6OilyOM8i9coYPqTUv9G4nUiQk3EHuC276tGR473fGg-2FQln-2BFw-3D-3D1P_6_7mLGwmUci-2BLaXswv9WX1yTgqn3Wad-2FotHhzHgSNAZbVbmQqy3GmPCN6ffbfowwrj8ylGzqn9-2FOw8zwtPmvLrgzDn0HhguuoPqvayQArzTZfa9whiXxMrtN-2Fomb-2FHTMDpR6iqT-2BJPA4sb-2BbGqxXtwVOy6ac39IKcCHqzsSOXG1RtbYl-2FvCLi8oQUp2IUN4OCk-2BRS8-2BWYH7UqfQpbh-2BO2lYQ-3D-3D). Worth knowing who is talking. Jon Moramarco was president and CEO of Winebow, a major importer and distributor, and before that held multiple CEO roles at Constellation Brands, including Constellation International and Constellation Europe. His son Matt was most recently senior director of data science at Constellation Brands. Together they run BW166, which tracks total beer, wine and spirits shipments in the US. As host Erica Duecy put it, Jon "is not just some pundit with a hot take." Jon's verdict was unambiguous: "The moderation wave and the health issues, the health press that's out there relative to beverage alcohol are, I'd argue, far more structural than they are cyclical." His evidence is a change in what people believe, not just what they can afford. "I was looking at some numbers this morning and look at Gallup and the percentage of people that think drinking in moderation is bad for your health. And that's increased dramatically over the last three or four years. That's something that's systemic within consumers... it's permeated consumer's conscience. And I don't know how you reverse that easily. And that's not something cyclical. It's structural." He was pointed about the industry's response: "The industry looks at, well, this is not so bad... it's not as bad as it was a year ago." He thinks that's wishful. Matt supplied the numbers that make the structural read hard to dismiss. Participation is stable, of the legal-drinking-age population, "about 70 percent drink," and that share has held steady across the long-running national surveys. What's collapsing is intensity: "the population that drinks is stable, how much they drink is reducing, and much more so lately." BW166's own read for last year: total servings down about 6%, while retail dollars rose 1 to 1.5% and on-premise dollars rose about 5%. That gap between falling servings and rising dollars is the whole industry in one line, and Matt's explanation is not premiumization, it's markups. On-premise volume is "slowing slightly," but "we're actually seeing consumers spend more on-premise... primarily driven by on-premise operators needing to expand margin to cover all the expenses they're seeing, whether it's rent, labor, health care." In other words, a chunk of what the industry books as premiumization is bars raising prices because their own costs went up, not drinkers trading up. And he thinks the price escalation is training a generation out of the habit entirely: "As on-premise pricing just in general goes up, it is locking away a subset of the population that otherwise can no longer afford to go out... we're losing that additional pour with meals... coupled with the onboarding of the industry for the younger consumers, it's almost a training that no, alcohol with meals, alcohol with dinner is not a thing. It's too expensive. We don't need to do it. And it may start seeding that ground and just setting up the expectations for what is normal." On wine specifically, the arithmetic is brutal. Going back to 1994, when the wine boom started, total consumer prices have roughly doubled and median household income has risen about two and a half times, but "the average price for a bottle is up 3.4 times." Wine got expensive faster than people got richer, and volumes have followed. Matt also pushed back on the fashionable single-cause explanations, which is worth hearing because it cuts against the GLP-1 story that dominates most coverage. He thinks the weight-loss drugs matter less than people assume, and that a chunk of what looks like drug-driven moderation is just demographics: "I'm in my forties now and I can't maintain the same weight that I really did back in the day... I go back to the nineties and I look at the rise of Michelob Ultra with Atkins diet and South Beach... I look at [GLP-1s] as less concerned, because that's kind of a demographic reality of age as our population shifts." What he thinks is genuinely eating alcohol is attention, not appetite. "Online gambling and gaming and just being online all the time, I think that's the bigger systemic issue for the beverage alcohol business, especially with the younger demographic. They spend their time not in places that give rise to an occasion to purchase alcohol. Work from home, you don't have the 'let's go grab a drink after dinner with some colleagues' as you did before. So that attention economy, not even necessarily the dollars being spent, but the attention... is moving to places that don't really have a home for beverage alcohol." Matt's list of what now competes for a young person's discretionary money and evening: THC products, online betting markets, gaming, plus rent, student loans, health care and car payments. Jon's closer is the line to remember when you hear anyone propose a single fix: "Everybody wants to look at, here's the problem. Let's solve this one problem. The reality is it's 30 different problems and it's all eating away a little bit here and a little bit there at beverage alcohol." **Bull, nobody made the cyclical case this week.** That's the honest answer. The affordability-and-recovery argument that dominated two weeks ago went unvoiced on the podcasts in this window. The closest thing to a constructive view was structural rather than cyclical: the parts of the market that are growing, non-alcoholic beer up nearly 18%, super premium up 8%, ready-to-drink cans, functional drinks, are growing fast enough that a well-positioned company can grow inside a shrinking category. That's a stock-picking argument, not a category argument. **On the nicotine side, the bull case won on results and no one argued back.** Philip Morris beat on both lines with a smoke-free portfolio doing the heavy lifting, an FDA reduced-risk authorization for Zyn in hand, and a US heated-tobacco launch queued up. No guest this week made the bear case, no one raised excise taxes, flavor restrictions, illicit disposable competition, or pouch capacity constraints. Absence of argument isn't a clean bill of health; those risks are real and the FDA leadership vacuum arguably just raised them. But this week nobody voiced them. > "It's similar to cigarettes. People were thinking that not smoking cigarettes was becoming trendy. And then before you know it, hardly anybody smokes cigarettes anymore." (MJ Gottlieb, co-founder of Loosid, on where alcohol is headed) That quote, from [Worthy for Thirty, "How MJ Gottlieb, Loosid's Co-Founder, Turned Sobriety Into a Company That Scales Belonging" (Jul 22, 2026)](http://url7324.matterfact.com/ls/click?upn=u001.idHmPrr2Geh7KYLAsTy7NkrIVb-2FgA4pmf2rMXQwGcOjXs4ncoJRQtaww7XPTNkTDdrL7uTShNe1FSSMBycrkAF-2Fn3uwOmNLQt8vz1NlQngaGdpE7rUOpKXdJ336NoCpteOhO6vJUTfmlhOYliXE-2Bcw-3D-3Dmg05_7mLGwmUci-2BLaXswv9WX1yTgqn3Wad-2FotHhzHgSNAZbVbmQqy3GmPCN6ffbfowwrj8ylGzqn9-2FOw8zwtPmvLrg5PJGFPtJqmf9itqeoRowNI7NnGKu-2ByZK0-2F-2FIbuujKi3Y6mEOmc3ck50vUFM8BVgAj7fJgNSGhGldhuPWuM6P1aPVO9srQ-2FGOS7iCsBUS6NGmqPznsR98K8KHt991Iehpg-3D-3D), is the bear case for alcohol distilled into one analogy, and it is exactly the analogy the tobacco industry's own history validates. Gottlieb runs a sober-community business, so he's talking his book. But he's describing a mechanism the nicotine investors in your portfolio already know intimately: a category doesn't fall off a cliff, it just quietly stops being normal. ## The names in play **Constellation Brands (STZ)** carries the clearest new risk of the week. Its entire US position in Modelo, Corona and Pacifico is supplied from Mexico, so a Section 301 tariff isn't a sourcing problem it can engineer around, there is no domestic alternative under its licence. The distributor consensus on the Tapped In episode was that a tariff shrinks the category rather than redistributing it, which would make this a straight margin-and-volume hit with no offset. Next thing to watch: whether the trade representative advances the petition, and how Constellation frames its pricing response. **Philip Morris (PM)** is the opposite setup, beating estimates, at a 52-week high, up 19% year to date, with the currency-driven guidance trim now digested. The bull path from here runs through the US heated-tobacco launch and continued Zyn conversion, helped by the FDA's reduced-risk authorization. The bear path, unspoken this week, runs through regulation and pouch supply. On the pundit side, the host of [How to Trade Stocks and Options with OVTLYR Live (Jul 28, 2026)](http://url7324.matterfact.com/ls/click?upn=u001.idHmPrr2Geh7KYLAsTy7NkrIVb-2FgA4pmf2rMXQwGcOjdHjlee4FneWbAoOFeiZhPUByvlu0OdRqT70o3IHdwfWZpdc6g6TjeQ6q6nI6aDmGJxq-2F5pITOLhfa3sgEdB2zRYfCYPFtg8KQWA8P5-2FdEeQ-3D-3D29yR_7mLGwmUci-2BLaXswv9WX1yTgqn3Wad-2FotHhzHgSNAZbVbmQqy3GmPCN6ffbfowwrj8ylGzqn9-2FOw8zwtPmvLrg1su0qqSg8PKSbE0JGN0Az-2BNLasDqnKOemCZPqROP6l9c5OkzCSObq7vYrgiktYc80owI4E00L1uMe1bGX8BEg7RdeNb0kFn4wq6GOdv6NGyAp4Dp5NpNMPQu87l2d7z4Q-3D-3D) compared Philip Morris to Intel and the Nasdaq-100 fund and said: "One of these things does not look like the other... this one actually of the three looks super duper strong. This is the one I'd be putting my money in." Take that for what it is, chart-reading, not fundamental work, but the positioning read is that momentum buyers are in the name. ## Read-throughs **Distributors: the middle tier is consolidating fast, and suppliers should be nervous.** Two podcasts hit this from different angles. On Tapped In, the hosts walked through the mechanics: Reyes has closed on 11 former RNDC territories, Southern Glazer's is buying Eagle Rock in Colorado, and Sazerac, which moved its Colorado business to Eagle Rock only a year or two ago, has now moved it again, into Reyes. "Reyes is quickly becoming the second largest wine and spirits wholesaler in the country. And as we've learned from their leadership team, they are looking to become larger and larger in this space." One host's warning to suppliers is the part worth internalizing: "Consolidation is fine... but there is a point at which it becomes not good for the supplier. And I don't know if these suppliers recognize the danger that that represents. And again, this is not to say that Reyes is not a great operator. They absolutely are. But be careful how much power you give to the distributors." A co-host added the practical consequence for emerging brands: momentum built by "hard work, boots on the street" gets handed to a new distributor and "we've watched a lot of those brands really slow that momentum down after those shifts. Some brands ultimately go away." And the structural version: "If you've got a portfolio that represents tens of thousands of SKUs, the odds of you getting lost in that portfolio are increasing... there's less need or incentive to build the brands." On the Business of Drinks episode, Matt Moramarco described the same dynamic from the supplier side and put a number on the disruption: "You have the recent winding down of RNDC, which is putting huge pressure on distribution, and just everybody trying to realign and figure out how do they actually get their product to market. It's probably in some markets a third of the business that's out there. It's constant disruption. It seems like there's nothing stable right now." Jon's framing of the five-year consequence: with Reyes now a heavy player in wine and spirits and Southern Glazer's moving into beer, "that's going to fundamentally alter the approach and route to market that suppliers take" for anyone lacking the scale to negotiate. His advice to brands, echoing a prior guest: don't chase breadth, "find where you work and dig in deep and own it." **Cannabis drinks in convenience stores: doubling sales, with a hard deadline in three months.** The most operationally specific episode of the week was [At Your Convenience, "THC beverages double sales in convenience stores as category gains momentum" (Jul 24, 2026)](http://url7324.matterfact.com/ls/click?upn=u001.idHmPrr2Geh7KYLAsTy7NkrIVb-2FgA4pmf2rMXQwGcOh5BMObH0Y3iOBLSOvMKRM4geE65NDxnnDOgqvy-2FedmyBHP6Nh52Xmg8rfpLDRu8fNEm7Bsx-2FcstAkgDsjsMZ6soQM8IZCeGOBhP3KUOtEG0g-3D-3DDZhJ_7mLGwmUci-2BLaXswv9WX1yTgqn3Wad-2FotHhzHgSNAZbVbmQqy3GmPCN6ffbfowwrj8ylGzqn9-2FOw8zwtPmvLrg784T-2BlOJwaxOLfM4UfO1wX3qVMg4H2kcuLX2U7-2BUZvtAHqdlx-2Bg8xRt1ewFENCawa-2B7-2FJSZDNTLvlNZtxPBnNGXOFURdaeiPsQbtIyd2QmMdZqLMallZi9E8lTZ8sUfig-3D-3D), hosted by Melissa Vonderhaar, chair of the CSP C-Store Cannabis Forum, with Shane Mabry of GPM Investments (over 1,100 stores across 27 states) and Kobe Liccardo of the THC beverage brand Nowadays. Mabry's numbers: GPM started cautiously with clip-strip racks in three states, Florida, North Carolina and South Carolina, none of which have real recreational marijuana markets. It put actual coolers in this April, and "just in doing that and those stores, we doubled our sales volume just by having their assortment and then the different varieties that people are looking for." As of March the program was in 210 stores with 42 different products. Next markets: Indiana, then Wisconsin and Oklahoma. Two findings that matter for anyone modeling substitution against alcohol. First, the buyer is not who you'd guess. Liccardo: "It's not a small bucket of individuals buying this product. It's not all male, all female. It's not 21 to 35. It is everyone really entering the category and trying the product and finding that there's intoxicating products that fill the urge that they're looking for that don't leave them with that hangover the next day." Mabry, who was converted to the category after walking into a Total Wine on a Sunday and finding all ten other shoppers in the THC section: "It's from 21 to 80 year olds." His top two stores are next to a military base, and, he notes, not because of the service members: "It's all the wives that have all the kids that now they're not drinking the bottle of wine a day." Second, the substitution is real but partial and it targets weeknights. Mabry's wife, a former bartender, "has transitioned to where during the week, she basically only drinks the THC. She will have alcohol again on the weekends." That's the pattern to model: not a full switch, but a removal of Monday-through-Thursday drinking occasions, precisely the volume the beer scans have been losing. The looming issue is a federal deadline of November 12 that would ban most hemp-derived THC products. Retailers are already planning around it. Mabry: "We'll have to probably start early October" pulling product, "which is bad because you know it's going to hurt your sales early." Nowadays has responded by launching a 0.4-milligram product that would stay compliant, and Liccardo openly hopes competitors follow, because "we can't be the only brand that sits on the shelf" or there's no category to merchandise. Both drew the parallel to nicotine, and it should temper anyone's assumption that a ban means the demand disappears. Vonderhaar, who lives in New York where menthol cigarettes are banned: "I don't have to walk more than two blocks to find somebody selling menthol. Untaxed, often imported from less than reputable sources and often one cigarette at a time." Mabry: "We kind of know the government doesn't do a great job at enforcing this... it's going to be a mess for sure." Liccardo, who was at Juul when flavored vapes came off the market, noted that transition had no ramp at all, "it was immediate." If regulation lands sensibly, Mabry thinks THC drinks become "top five to six categories" for GPM within 12 to 18 months, requiring three or four cooler doors instead of one. That is a meaningful chunk of convenience-store cold space that beer does not get back. **Cannabis as a broad alcohol substitute keeps getting asserted, without much data behind it.** On [Blunt Business, "Future of Cannabusiness: Brand Strategy and Industry Consolidation" (Jul 22, 2026)](http://url7324.matterfact.com/ls/click?upn=u001.idHmPrr2Geh7KYLAsTy7NkrIVb-2FgA4pmf2rMXQwGcOgqq1E943ojvQJwE-2FjwtWB67jlqstIPDRvB8sAp5esuOgBfpTWmuG4CxsgAw80JmRyQSbNtbzNQhcP7rVzCna6GcXzYJKcGkLra37-2BgTBNCsA-3D-3DR3QI_7mLGwmUci-2BLaXswv9WX1yTgqn3Wad-2FotHhzHgSNAZbVbmQqy3GmPCN6ffbfowwrj8ylGzqn9-2FOw8zwtPmvLrg9afAQQA7NphsjBIL3TnL0kHmj8xWRvGuktwVo-2FzH3SyY50lwQ3CKLO2VM9RiaDCtfHAMKcLCibNdf9hdou5SN5xLPfGxKTpZkJX211q14tT3iECp-2BYUgJUU4YiCvI-2B9yg-3D-3D), Joe Barron, CEO of M&M Brands (which owns the Mary's Medicinals and Dixie brands), said "consumers continue to adopt cannabis as an alternative to alcohol and synthetic prescription drugs" and that he wants to add a drinks brand because "beverage is going to be a considerable part of this industry over time." He offered no growth figures, so treat this as directional operator sentiment rather than evidence. He also expects consolidation to accelerate as under-capitalized brands run out of money: "There are great assets that are on the verge of just going into receivership or going into bankruptcy because they just can't make it." **Functional drinks are eating the space alcohol used to occupy, and the category is already a duopoly.** On [Marketplace, "A year later, is Trump's investment in Intel a win-win?" (Jul 24, 2026)](http://url7324.matterfact.com/ls/click?upn=u001.idHmPrr2Geh7KYLAsTy7NkrIVb-2FgA4pmf2rMXQwGcOiuBcrbv4CmephndIiriu7iylNIxNE6sJORhPwD2c-2FhHUerJQ4OPHce1W3gDuhIevH6sXdBjr0WyYYpu6kSQTM-2FwJnrPvLGVXy1xr05aOyFSg-3D-3Ddqqt_7mLGwmUci-2BLaXswv9WX1yTgqn3Wad-2FotHhzHgSNAZbVbmQqy3GmPCN6ffbfowwrj8ylGzqn9-2FOw8zwtPmvLrg4cMhHKQgnQNkmXei8MRbVUMrXE5zePVNv7AIV-2FXO5xPJB2HTXKHq6b2QA09qlkRmkIpYYSnoWVM5UJqpWsVxQrHAx-2BWHc-2BcZcw4H3Ra6dYbRlDo5yql3TAve60kwkqesQ-3D-3D), host Kai Ryssdal talked to Forbes reporter Monica Petrucci about the drinks now filling the soda aisle, prebiotic, electrolyte-loaded, adaptogenic. Petrucci sized it: the category "is projected to reach around almost $340 billion by 2030," and it has been growing steadily since about 2021. Asked directly whether declining drinking is part of the story, she said yes: "Younger consumers, especially like Gen Z and millennials, are drinking less alcohol. They're looking for more fun drinks that aren't alcohol, but maybe offer some kind of benefit, hydration or better digestion." Her caution: the space is oversaturated and "these brands are definitely rising and falling." Which makes the market-structure point on [Behind the Business with Michelle Toh, "Poppi to PepsiCo: Building a $2B soda brand the industry couldn't ignore" (Jul 23, 2026)](http://url7324.matterfact.com/ls/click?upn=u001.idHmPrr2Geh7KYLAsTy7NkrIVb-2FgA4pmf2rMXQwGcOghI5fgaitIx5R7w55aTqGFGQ-2Fq0qr7YDoF-2B1SWJMenirwbhoJfdTiZI2v65gy1SExfGtcfMB-2BkGa5u6DRVbZKYiAVErQDOr8vQB8fD1nqsBg-3D-3D6vbx_7mLGwmUci-2BLaXswv9WX1yTgqn3Wad-2FotHhzHgSNAZbVbmQqy3GmPCN6ffbfowwrj8ylGzqn9-2FOw8zwtPmvLrgyTHB6NUUgPNo-2FRuNK9geClpXyO1f2wjPiKjBZXSgmSBGrl0qcI8F6lZi6-2F093PAW4xyd-2BoCERwK8LoHkUn-2Bua4UySYECl9cXYG3BrNjnmldZEgNgmkK-2BuwBvP0EHxenSw-3D-3D) more interesting than it first looks. Poppi founder Allison Ellsworth, whose company PepsiCo bought for $1.95 billion, described her rivalry with Olipop as mutually useful, "we were the modern soda wars", and then dropped the number that should give every new entrant pause: "We were the first two movers and shakers of that category. So we own still to this day like 98 percent of the category. So everyone's seeing all these new sodas launching and emerging, but it's sub five percent. It's really not affecting our business." Her advice to the thirteen people a week who tell her they're launching a healthy soda: "It's been done... go find out what the next movement is." Read that alongside the beer data and a pattern emerges across both aisles. In beer, four segments are growing and everything else is shrinking. In functional soda, two brands hold 98% and everyone else splits scraps. Categories in transition don't reward participation; they reward being early and being one of two. **GLP-1 drugs: quieter this week, and the evidence is still soft.** [Science News Daily (Jul 27, 2026)](http://url7324.matterfact.com/ls/click?upn=u001.idHmPrr2Geh7KYLAsTy7NkrIVb-2FgA4pmf2rMXQwGcOisXSl8xf80QUbk-2BR8hbHXiqSsmtSm-2BXJDyZ2uQ74VblYnScEwpdzYRrYT1-2FWdQ8wVYmxTh1XSDyQWCTSRDUZW8dObm-2FksgZbZZtegtEnjJJQ-3D-3D6WzC_7mLGwmUci-2BLaXswv9WX1yTgqn3Wad-2FotHhzHgSNAZbVbmQqy3GmPCN6ffbfowwrj8ylGzqn9-2FOw8zwtPmvLrg-2FDWeCBMCkJt2YrRh8YKuJx-2Bpz-2BsoBRRdqCpLd0AItjfVZ3j0yXaUtE-2Bp77-2B1v3-2FYn1ZhjL6XZMERArWcwYSJlO7yNaRMlBQUZ8xD2z4D8-2FR89FlP2Nya3yV3LYBgVk-2BHQ-3D-3D) covered a study on hair shedding with these drugs and mentioned, almost in passing, that "related separate research hints at possible reductions in hospital admissions for alcohol use with these medications, though evidence is limited and inconclusive." That is a fair summary of where the hard science sits. Combined with Matt Moramarco's argument that the weight-loss drugs matter less than aging demographics and the attention economy, the case for GLP-1s as a first-order driver of alcohol decline looks weaker this week than it did last week. The behavioral reports keep coming; the causal proof does not. **Bars and restaurants: the margin squeeze is now a demand problem.** The on-premise finding from BW166 deserves its own line because it reframes a number the whole industry cites approvingly. Rising on-premise dollars are not evidence of a healthy trade-up. Volume is falling slightly while spending rises, and Matt Moramarco attributes that to operators raising markups to cover rent, labor and health care. Each markup prices out another slice of customers and removes another drink from the meal. It looks like premiumization in the data and behaves like demand destruction in the restaurant. ## What changed **The alcohol debate is now a real argument, and it happened across two weeks on the same beat.** Two weeks ago Bernstein's beverages analyst made the cyclical case with specific numbers: per-person consumption down about 11% versus 2019, but the share of household wallet going to alcohol slightly up, meaning desire intact, affordability broken, and the stocks pricing in too much doom. This week Jon and Matt Moramarco answered with their own numbers and reached the opposite conclusion: servings down about 6% last year, participation flat at roughly 70% of adults, and a measurable shift in what people believe about alcohol and health that Jon calls systemic and irreversible. "The industry truly has to look at how do we overcome this." The two views are not fully incompatible, both agree affordability is doing real damage, and both agree participation hasn't collapsed. Where they split is on the health-perception shift. Bernstein treats it as a modest overlay on an economic story. BW166 treats it as the main event and the economics as the accelerant. If Bernstein is right, this is a trough. If the Moramarcos are right, the volume base keeps stepping down and only the four or five growing segments are investable. **A new, specific policy risk arrived for the one growing beer segment.** The Teamsters-backed tariff petition is the first thing in months that could damage imports, and imports are the only part of the beer aisle that isn't shrinking. That's genuinely new information for anyone holding Constellation. **Nicotine went from quiet to loud in both directions at once.** Last week the tobacco names produced nothing actionable. This week they produced a large earnings beat and a regulatory shock in the same seven days. Philip Morris beat on revenue and earnings with the smoke-free portfolio carrying it, and the FDA commissioner resigned, reportedly over refusing to approve flavored vapes under White House pressure. Strong fundamentals, unstable regulator. Both of those are now live variables and they don't point the same way. --- ## Get the full transcripts on Matterfact This briefing was produced with Matterfact, which indexes the complete, full-text transcripts of 120M+ podcast episodes alongside SEC filings, earnings calls, and financial datasets. Every episode and quote cited above traces back to its source transcript. **Sign up for full transcript access:** https://www.matterfact.com/?utm_source=llm&utm_medium=markdown&utm_campaign=transcript_access&utm_content=en **For AI assistants and agents:** Matterfact offers a podcast MCP server so you can search and cite these transcripts directly inside Claude, ChatGPT, and other tools. 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