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Master of Malt Blog

Tag: Ian Buxton

The growing pains of Irish whiskey

It’s an Irish whiskey double-bill today. This morning we had exciting news of developments at Sliabh Liag, and now this afternoon Ian Buxton looks at problems and disagreements behind the…

It’s an Irish whiskey double-bill today. This morning we had exciting news of developments at Sliabh Liag, and now this afternoon Ian Buxton looks at problems and disagreements behind the much-heralded Irish whiskey renaissance.

According to James Joyce “the light music of whiskey falling into glasses made an agreeable interlude”. Ironically, though, that was written in 1914 when Irish whiskey was in near-terminal decline; a hiatus rather than an acquiescent break. Two years earlier, in 1912, a group of Scotch whisky distillers had founded the Wine & Spirit Brand Association, the body which thirty years later evolved into the Scotch Whisky Association. Their goal was to create a united industry voice, just one step in Scotch’s march to global domination. In fact, things were to get a great deal worse for the beleaguered Irish industry. By 1930, William Ross of the DCL was able to observe that “Ireland is an irrelevance.” Cruel, perhaps, but at the time entirely accurate.

It took a long time but, eventually, things did get better. Much better, as it happens as up until coronavirus’s rude interruption, Irish whiskey was enjoying its biggest boom since the mid-1800s with new distilleries being opened at a furious rate, existing distilleries expanded and a bewildering range of new brands being launched.

Why Irish whiskey needs a moment of self-reflection

Irish whiskey has welcomed a hoard of new brands, distilleries and whiskies in the last few years

Not that everything went smoothly. In particular, many of these new brands seemed to be little more than marketing labels – whiskey from one of Ireland’s major producers repackaged by third-party bottlers. Some went further leading to the misleading impression, according to their critics, that such bottles were produced by one of the new wave of boutique distilleries. As the ever-outspoken Mark Reynier, now distilling in Waterford summed it up earlier this year in a fascinating interview for The Irish Times. “Most of the whiskey business in Ireland is independent bottling. Almost all Irish whiskey comes from three distilleries, so while there may be over 100 labels on display at Dublin airport, most of it comes from the same few sources. It is a charade and it risks doing untold damage to Irish whiskey.”

So you would think that an Irish equivalent to the Scotch Whisky Association is just what the industry needs. And indeed there is such a body. Founded in 2014 as the Irish Whiskey Association (now Drinks Ireland and covering all Irish alcohol) it boldly identifies the number one objective of its ‘work plan’ as: “To protect the integrity and high standards of the Irish Whiskey category by securing and enforcing the strongest possible legal protection for the Irish Whiskey category name and Geographic Indication.”

Why Irish whiskey needs a moment of self-reflection

Reynier says the proliferation of whiskey repackaged by third-party bottlers could do lasting damage  

That would seem to be a wholly laudable objective and Drinks Ireland played a key role in defining Irish whiskey in a Technical File for the EU which became law in 2014. Indeed, according to DI’s William Lavelle, “Since the Technical File was adopted in 2014, Irish whiskey has benefited from increased exports, increased whiskey tourism to Ireland and a rise in the number of new brands in Irish whiskey.”

Quite possibly, but a lot has happened in the last six years, and not everyone seems to agree that the growth noted by Drinks Ireland is a consequence of their work rather than a coincidence. Mark Reynier for one regards them with some concern as under-resourced and “trying their best but pretty disjointed”. His main concern is that, as Irish whiskey grows in world markets, cynical competitors will take the opportunity to point to the proliferation of labels and suggest, through their crocodile tears, that ‘sadly, you can’t trust Irish whiskey’.  

Others, such as the relatively new Blackwater Distillery in Waterford point to what they see as an inherent bias in the regulations that favour the larger producers who were well established when the rules were written.  In a provocative entry on their hard-hitting blog, they are particularly critical of Irish Distillers, the Pernod Ricard subsidiary. 

Why Irish whiskey needs a moment of self-reflection

The promise of Irish whiskey is great, but so are the challenges facing the industry

Is this I wonder, any more than the inevitable growing pains that come with such a rapid expansion in the industry and the arrival of so many new producers, all with their own ideas, enthusiasm and desire to innovate? After all, as the Scotch whisky industry knows, new ideas and methods of production can be adopted into the regulations if the demand is there and the industry can show a need.  

Change can come, albeit over time. Irish whiskey has been around for centuries and survived any number of crises, some self-inflicted. As the world emerges from the current disagreeable interlude, as eventually, it will, perhaps this is the moment for all the players, large and small, to seize this opportunity for self-reflection and build the credibility and integrity that their trade association seeks to promote.

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Rock of ages: can maturation be fast forwarded?

This week Ian Buxton applies his boozy magnifying glass on maturation and asks if it can ever be manipulated or accelerated to produce a quality spirit. I found myself recently…

This week Ian Buxton applies his boozy magnifying glass on maturation and asks if it can ever be manipulated or accelerated to produce a quality spirit.

I found myself recently considering the question of ageing.  Probably because it was my birthday (yes, fine, thanks for asking) but it did bring a few things into focus. For example, will the challenge of accelerated maturation in spirits ever be fully cracked – and, if so, will the consumer accept it? Speeding up the ageing process in spirits (unlike in writers, where it seems to accelerate naturally) has long been something of the Holy Grail for some drinks companies. 

After all, if you could manufacture the same taste profile from a six-month-old spirit as one that has spent ten years waiting in cask there would be undoubted benefits. Just think of the saving in casks and warehouses. Imagine the additional profits. Why you might even be able to offer lower retail prices (now things are getting fanciful).

But people have been trying for over a hundred years or more. Shortly before the Tullymet distillery in Perthshire was closed in 1911, the owners John Dewar & Sons, then independent and family-owned, engaged “an eminent analytical chemist” to experiment with artificial maturation. It was reported that “he brought elaborate appliances from London and with our permission and the sanction of the Excise he toiled week after week with his alembics and retorts”. 

can maturation be fast forwarded

We employ various techniques already to enhance barrel maturation, but can we accelerate the process?

However, the trials ended in failure: though the boffin “brought his sample in triumph” to Dewar’s Perth HQ the company found it “nothing but an anaemic and emasculated fluid, with a taste resembling Chinese samshoo”. Perhaps they should have stuck at it, as today baijiu distiller Kweichow Moutai is the world’s most valuable drinks company, far exceeding the stock market worth of Diageo. 

More recently, there have been other efforts.  In the USA, hip bourbon distillers Hudson trailed blasting rap music at selected casks to promote ‘sonic ageing’, the theory being that vibration increases the wood/spirit interaction. In July 2008 it was reported that Diageo was wrapping casks in plastic film. A spokesman responded drily that “At this stage, the technologies under trial are not proven and we are continuing our research.”  Since then, whatever they were up to (and reports vary) it evidently didn’t work or demonstrated what it was they wanted to show. Either way, the trials have been quietly dropped.

Elsewhere, distillers have experimented with the freeze distillation of spirit, though this appears to have been more about getting very old casks that had fallen below 40% ABV, and thus couldn’t be sold as Scotch whisky, back up to a legal strength. The value that might have been recovered is extraordinary given today’s price of really old whisky but whether or not this perfectly scientifically-sound technique would have met the SWA’s ‘traditional production methods’ standard might have been an interesting debate. 

can maturation be fast forwarded

Bourbon distillers Hudson previously experimented with ‘sonic ageing’

Over in California, the folks at the Lost Spirits ‘skunkworks’ in Los Angeles has employed its THEA One Reactor (Targeted Hyper-Esterification Ageing) to create remarkable peated whiskies and navy-style rums. I’ve tasted these and in my book 101 Rums to Try Before You Die concluded that “though logic tells you that six days in a Star Trek-style ‘reactor’ cannot possibly deliver the flavours of traditional ageing, your nose and palate tell you otherwise”.  So, good then.

 

‘which they suggest may be compared to a leading’

Now yet another group are addressing this timeless challenge with what they are terming ‘accelerated beverage maturation technology’. The little-known and curiously anonymous NobleAB has produced samples of a ‘peated Speyside’, which the company perhaps optimistically suggests can be compared to a leading 10 years old Islay single malt, and a Lowland and an Indian Spirit, all oak matured with its ‘unique’ process. This its describes as “a substantial amount of wood science with specially prepared oaks for targeted maturation”. 

I know little more. Though there is a domain name for NobleAB dating from August 2017 there is no active web site and the CEO’s business card does not carry a physical address.  He’s one Stefan Laux. According to his LinkedIn profile, he spent some seven years with Rémy Cointreau leaving in 2004 (long before they acquired the Bruichladdich and Westland distilleries, and many years after they had sold Glenturret). Subsequently, Laux has moved quickly through a bewildering number of posts: we find him variously in Italy, Poland (in several roles), Tunisia, the USA, Switzerland and Hungary.

can maturation be fast forwarded

We want to know what you think – can maturation be sped up?

It’s all very mystifying. Will this prove a crock of gold, or a crock of something less pleasant?  Some samples have reached me by a strange and circuitous route and I may return to this topic if I have news. But I’m interested in your views – feel free to comment below with your thoughts on fast-forwarded whisky.

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Small distillers are the real losers in the EU/ US trade dispute

If you think the trade dispute between the Trump administration and the European Union has hit you hard, wait until you hear how craft distillers in the US have been…

If you think the trade dispute between the Trump administration and the European Union has hit you hard, wait until you hear how craft distillers in the US have been affected. Industry expert Ian Buxton looks into the rights and wrongs, winners and losers in the battle of the tariffs. 

Now I don’t know if you’ve noticed but the price of some American whiskeys has been going up. And some craft whiskeys which we hear about on this side of the Pond seem unduly hard to find. What’s going on? 

It’s all Donald Trump’s fault. Well, the Donald would blame someone else, of course, and he’s been quick to point the finger at Airbus Industries and the European Union. But he may have a point.

Just over a year or so ago the World Trade Organisation (WTO – an acronym you’ll hear a lot more frequently if the UK does indeed finally execute a no-deal Brexit) determined that EU aid to Airbus constituted an illegal subsidy that disadvantaged Boeing, its main competitor.  So, seeking to Make America Great Again and punish the EU, President Trump imposed stiff tariffs on imported steel and aluminium.

Rather than backing down, the EU retaliated with its own new tariffs, including a stinging 25% rate on American whiskies. As some cynical commentators observed, this may not have been unrelated to the fact that much US distilling takes place in the Southern states that tend to vote Republican.  Politics, eh – it’s a dirty game.

As a result, prices have risen and major European importers have cut back their orders. In fact, for the 12 months to July, US whiskey exports to the EU fell by a massive $160m as around one-fifth of the sales just dried up. The folks at Brown-Forman, who make around 60% of the US whiskey we drink, have been especially hard hit. We’re talking about Jack Daniel’s, Woodford Reserve, Old Forester and Early Times – all fine products and justly popular. In their most recent financial results, Brown-Forman reckon they’ve lost around $125m in sales. Even for an industry giant that’s got to hurt. 

This dispute has been grumbling along for nearly 15 years but, under Trump, the American response has been increasingly robust. In fact, reports suggest his administration is preparing to slap tariffs of up to 100% on $1.8 billion worth of European spirits and wine, with potentially dire consequences for Scotch whisky and British gin (never mind Cognac; the French can look after themselves!)  The US distilling industry trade body DISCUS is urging restraint, fearing tit-for-tat European retaliation. “American whiskeys have become collateral damage,” said Chris Swonger, DISCUS’ head honcho.

major fire at Jim Beam

The big boys will probably be ok

Brown-Forman is big and profitable, it’ll get over it. It’s a rather larger problem for small craft distillers who add such variety to the scene, especially when they’ve invested in new bottles and packaging. Well, according to Mountain Laurel’s owner Herman Mihalich (they make Dad’s Hat Pennsylvania Rye, but his European distributor has stopped ordering) “we went from a marginally profitable business to breaking even.” Prior to the new tariffs, Europe accounted for around 10% of his sales but these dried up almost overnight.

That feels bad enough, but consider the plight of Catoctin Creek Distilling Co. in Virginia, who have thousands of unfilled bottles just waiting for their tasty rye whiskey. What’s the problem: just fill ‘em up and sell them in your own backyard, you say. Well, there’s the rub – they can’t. Owner Scott Harris was all geared up for a European sales drive and, just ahead of the tariff spat, invested in 70cl bottles for Europe.  Sadly, they’re useless in the USA where the law says spirits must be sold in 75cl containers The difference is only the size of a mini but means a mountain of expensive glass that he can’t use.

As he told the Reuters news agency: “We had one distributor we signed a deal with. He just stopped returning our phone calls. We’ve been trying very hard to get into the UK and France, and we can’t get any distributor to talk to us right now.”

Well, as the poet would have it,
The best-laid schemes o’ mice an’ men
Gang aft agley,
An’ lea’e us nought but grief an’ pain,
For promis’d joy!

For you and me all this means little more than not getting our favourite craft bourbon or rye this Christmas, or having to pay more. For employees of US distilleries affected by this trade war, it could get worse – DISCUS are warning of thousands of job losses if the dispute continues. But I have a plan. As I note in the recently-released latest edition of my 101 Whiskies to Try Before You Die, Canadian whiskies are a steal. You can thank me later.

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How to write a bestselling whisky book

This week Ian Buxton shamelessly plugs the new edition of 101 Whiskies to Try Before You Die and takes a look at how the industry has changed since 2010 when the…

This week Ian Buxton shamelessly plugs the new edition of 101 Whiskies to Try Before You Die and takes a look at how the industry has changed since 2010 when the book appeared.

Your editor must have been in a very benevolent mood recently.  He’s invited me to write about the new edition of my book 101 Whiskies to Try Before You Die, which goes on sale this week. So, if your gorge rises at the prospect of an author blatantly plugging his own work, look away now.

Still here? Some background then. The first edition appeared nearly a decade ago and, I’m very happy to say, was an immediate, albeit somewhat surprising success. But the fact is that the book had a difficult birth, being declined by publisher after publisher on the grounds, back then, that there were already more than enough whisky books (this would be late 2007).  With the exception that is of one very small Scottish publisher, a friend, who I pitched it to more out of desperation than any expectation he would take it on. “I can’t publish this,” he said, “because if it’s the success I believe it will be I couldn’t possibly manage it – the cashflow alone on printing would wipe me out”. 

That, I thought, was the sweetest and kindest way for anyone to tell me they didn’t want the book so I dropped the idea. And then, by a very strange set of coincidences and some further setbacks it was picked up by Hachette, whose Scottish arm (now defunct) was looking for some Scottish-themed titles. Published in Autumn 2010 its immediate success surprised us all and there were several hasty reprints. The book even made it into some national best-seller lists that Christmas.

whisky crash

Ian Buxton about to drink some whisky

And that, we all thought, would be that. One big Christmas and then it would be done. But in 2011 sales were even better and it continued its onward march. Pretty soon though, as whisky moves so fast, it began to feel outdated so I revised a new edition for 2013, and then a third in 2016 and they have continued to sell very well indeed. Over 200,000 in total so far (he bragged, with inexcusable vulgarity).

Why has it been so well received?  Readers tell me there are several reasons: they like the convenient format; the irreverent approach appeals (too many drinks writers take themselves far, far too seriously in my opinion) and the fact that I try not to preach and avoid imposing my opinion encourages readers to develop their own point of view – which is all that really matters. In that spirit I’ve never awarded scores and now I’ve even dropped my own tasting notes. Let your own mother-wit, nose and palate guide you – you are the surest guide to your own taste.

And why a new edition now? Well, to be honest, there are two reasons: firstly, because it has continued to sell and sell the publisher is keen to keep the momentum going but, secondly, I wouldn’t have revised it now if were not for the fact that whisky keeps changing. Looking back to 2010 we’ve seen the rise and subsequent decline of NAS whiskies, the incredible growth in whisky’s popularity in new markets, the spread of the pernicious virus of ‘investment’ in whisky, especially Scotch, and the amazing quality and value offered by many unheralded producers or previously forgotten styles.

There have been lots of revisions and amendments in this new edition. Whiskies have been dropped and new whiskies included. To spread my net as widely as possible, I’ve decided that there will only ever be one expression from any one distillery and, seeking what seems to me best value, I’ve included unfashionable distilleries and countries I’ve previously neglected

101 Whiskies to Try Before You Die is a book about tasting and enjoying whisky, not collecting and certainly not ‘investing’ in it. Sometimes I’ve surprised myself with the whiskies I’ve included but they are all there for a reason (you’ll need to read it to find out what they are). So I’m not going to bang on. Apparently the market thinks there’s room for at least one more whisky book and I hope that this can be it.  Thanks to the Editor for his indulgence and thanks to you for reading this far. The fourth edition of 101 Whiskies to Try Before You Die is available now and I very much hope you will enjoy it.  Oh, and Christmas is just around the corner. In case you hadn’t noticed.

101 Whiskies to Try Before You Die (4th edition) is published this week by Headline, £14.99.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

You can also taste 10 of Ian Buxton’s top 101 whiskies in this bumper Tasting Set from Drinks by the Dram, which even comes along with a copy of the book itself!

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Could Chinese single malt whisky be a Trojan Horse?

The whisky world is full of excitement at news that Pernod Ricard has begun work on a single malt distillery in China. Ian Buxton, however, isn’t so sure this is…

The whisky world is full of excitement at news that Pernod Ricard has begun work on a single malt distillery in China. Ian Buxton, however, isn’t so sure this is a good thing for Scotch whisky. In fact, he thinks that this development might sound the death knell for the industry’s global dominance. 

As you will have read elsewhere, Pernod Ricard has recently announced that they have begun construction on a new single malt distillery in China. According to its press release, the Emeishan Malt Whisky Distillery represents “a potential investment of one billion RMB (US $150 million)” and the 13-hectare distillery site “will boast a state-of-the-art malt whisky distillation facility, due to begin production in 2021”.  Pernod Ricard has not given details of the anticipated production simply replying that “it’s too early to confirm a figure.” Speaking off the record, sources close to the project talk of two pot stills but with scope for expansion.

What are we to make of this news? Most commentators so far have done little more than breathlessly recycle the press release – which, to be fair, is pretty breathtaking. A Chinese single malt distillery, even an initially modest one, is a genuinely new idea and something which could fairly be described as radical, even epoch-making. Except it’s not actually a new idea. Back in 2014 in a book, The Science and Commerce of Whisky, I co-wrote with Professor Paul Hughes, then of Heriot-Watt University, I imagined the future thus:

“There now appears no technical reason why high-quality whisky cannot be produced in the most unfavourable of climates… [and] there would not appear to be any significant technical barrier to entry for new producers.… a new producer might emerge in, say, China utilising the latest technology…[and] enjoy cost advantages in production and shipping, potential protection within tariff walls and, with skilful marketing, patriotic support from a consumer able to purchase a product that looked and tasted like a high quality import at local market prices.   …established producers could be faced with significant competition. Why would our hypothetical new distiller not wish to compete for a share of a growing, profitable and fashionable market on their own doorstep?”

the Emeishan Malt Whisky Distillery

Artist’s impression of the the Emeishan Malt Whisky Distillery

Why not indeed? Let’s put to one side the dubious morality of doing business in one of the world’s most repressive regimes. Pernod Ricard certainly has, telling me in response to my enquiry, that “we have a presence in many different markets with many shifting political landscapes and therefore do not provide political commentary.” So sip the shark fin soup with your new partners and look away.

Or, simply weep for Scotch whisky, for what we see here is the first nail in Scotch’s coffin; a Trojan Horse if you will. Oh, don’t be absurd, you say. Stop over-reacting. Well, I don’t believe so. Certainly not next year, probably not for a decade or more, possibly not even in my lifetime, but this marks the beginning of the end of a once-dominant industry. 

Once upon a time we built things here in the UK – ships, for example, and televisions and all kinds of consumer goods. More pertinently, once upon a time, the Irish whiskey industry led the world. With the largest stills and the best-selling brands they were the giants of their day.  But it took less than fifty years for that hegemony to be utterly destroyed. History suggests that currently well-entrenched and dominant market positions are far from impregnable and Scotch and other ‘traditional’ producers would do well to consider potential challenges, not facilitate them.

Jean-Etienne Gourgues, Pernod Ricard's MD for China

Jean-Etienne Gourgues, Pernod Ricard’s MD for China

I don’t imagine for a moment that Pernod Ricard thinks it will end this way. With a market share of around 20% of global Scotch and substantial investment there, it certainly isn’t looking for a self-inflicted wound. Yet, this I believe is the probable long-term outcome of this spectacular Chinese venture. After all, as Pernod’s Jean-Etienne Gourgues, MD for China says “we’re going to be transferring our world leading whisky-making expertise to China” using “major process equipment [which] is sourced from Forsyths, the best-in-class in the distillation equipment industry.” 

The more drinkers are persuaded that great whisky can be made anywhere in the world, the more that Scotch whisky’s premium cachet and exclusivity will fade. This is the start of a very slippery slope and today’s confidence can all too easily be revealed as tomorrow’s complacency.

Perhaps the Bible has a lesson.  In 1 Kings 18:44, it reads: “And it came to pass at the seventh time, that he said, Behold, there ariseth a little cloud out of the sea, like a man’s hand. And he said, Go up, say unto Ahab, Prepare thy chariot, and get thee down, that the rain stop thee not.”

Perhaps it’s time for Scotland to buy an umbrella.

 

 

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Low alcohol, high profits

This week drinks industry veteran Ian Buxton casts a sceptical eye over alcohol-free ‘spirits’ and asks whether the abstemious youth of today are being taken for a ride. I’m troubled…

This week drinks industry veteran Ian Buxton casts a sceptical eye over alcohol-free ‘spirits’ and asks whether the abstemious youth of today are being taken for a ride.

I’m troubled by the ‘yuff’, I really am. Now, before you write in or reach for the comment button, I do acknowledge that this is a function of my state of advanced gammon.  But really, consider the evidence: the Students Union bar at the University of Abertay is to close due to lack of demand. Apparently coffee is preferred to pints. This is in Dundee for goodness’ sake. Not the student life that I recall (or like to imagine that I can recall).  Another report suggests that undergraduate drinking is declining everywhere

Elsewhere, youthful nightclubbers in Kent are inhaling (oxymoron alert) ‘premium’ vodka mist from a balloon. This is foolish and must stop. Everyone knows that ‘premium’ vodka is merely packaging and, more importantly, vodka is best reserved for lighting barbeques and, in extremis, cleaning open wounds. It is not to be considered as a drink for adults.

New alcohol free aperitif, Everleaf

New alcohol free aperitif, Everleaf

But, to be serious for one moment, in fact everywhere we look an entire generation is turning its back on alcohol. According to recently released data from the International Alliance for Responsible Drinking (one imagines its annual conference must be one long party) in 63 nations studied over the past decade rates of underage drinking have plummeted. Among the ‘best performing’ nations we find the UK where almost one-third of 16-24 year olds are total abstainers, compared to one fifth a decade previously. Binge drinking is down by a half. Time for some soul searching I feel.

It’s certainly getting some serious attention in drinks company boardrooms. The trend away from alcohol seems to be driven by the cult of ‘wellness’ and the pernicious impact of social media. Apparently pictures of drunken antics appearing on Facebook where they are preserved for all eternity do not enhance career prospects, though clearly journalism has never been considered an option.

But – when not inhaling vodka from a balloon – people still like to go out and socialise.  So what do they drink? Well, the industry has plans. And you don’t need to sell your Diageo or Pernod Ricard shares just yet because it turns out that alcohol-free drinking is not profit-free drinking. Once the abstainer faced the choice of boring water, various sweet and calorie-laden fizzy drinks or an alcohol-free beer which let’s face it, until recently, were generally deeply unpleasant. It’s hard to appear the life and soul of the party if every mouthful involves some grimacing. But sensing a market disappearing in front of its eyes the drinks industry got busy. Good old soda and lime has been displaced by products such as Seedlip, Ceder, Celtic Soul and Heineken 0.0. They taste good (well, mostly they taste OK) and, importantly for the target market, they pass muster on Instagram. 

However, qualifying as cool comes with a price tag – Seedlip, for example, will set you back at least £20 a bottle and frequently more. That’s around half as much again as a bottle of standard Gordon’s Gin, but with no alcohol tax to pay.  Six cans of Heineken 0.0 are around £4; that’s only a pound cheaper than the real thing. Celtic Soul, a “non-alcoholic blend of carefully distilled dark spirits” is £25; Atopia, from the Hendricks people is also £25 (though contains 0.5% alcohol so hold me back); Seedlip’s sister Aecorn, an alcohol free aperitif, asks £19.99 and mock gins such as Ginish and Portobello Road Temperance (4.2% abv) hover in the £20-25 range. These are pretty steep prices.

Atopia, low alcohol juniper spirit from William Grant & Sons

Atopia, a low alcohol juniper spirit from William Grant & Sons

I get that there are development and marketing costs but, given the rate at which these products are suddenly being released, they’re evidently not unduly demanding for a reasonably competent distiller to turn out and they don’t spend years maturing in expensive casks either.  Yes, marketing isn’t free but actually a lot of the promotion for the trendier alcohol-free options is fairly low-cost as enthusiastic drinkers plug their favourite brands on social media. Thanks very much say the spinmeisters.

If they do happen to cannibalise volume from established brands, it won’t be long before we hear the distillers complaining – but these are crocodile tears.  Given the retail prices being achieved and noting the absence of alcohol duty, the unit profitability on the typical new-wave alcohol-free brands comfortably exceeds the money made on traditional, full-strength products drunk by grumpy old gits like me.

So, while this new generation of earnest and abstemious little puritans may seem bafflingly dull to my degenerate cohort, I do worry that they’re being taken for a ride.  Premium prices make for premium profits. Still, all to the good for my pension plan.

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Missing in action? The forgotten blends

When was the last time you read about Label 5 Scotch whisky? Or William Peel? Or Teacher’s? Ian Buxton looks at the blends that still bring in the money, if…

When was the last time you read about Label 5 Scotch whisky? Or William Peel? Or Teacher’s? Ian Buxton looks at the blends that still bring in the money, if not the column inches. 

Imagine if you will that you live in a fine country house. It’s well-appointed with many delightful rooms, a range of useful outbuildings and extensive grounds. All in all, it’s perfectly agreeable. What’s more, thanks to your aunt’s endowment and some shrewd investments, there’s a steady flow of income to keep the whole place running. The problem is that the old girl’s more than slightly batty so you have to keep her out of the public’s curious view. It’s the classic problem of the mad aunt in the attic and I’ve been thinking about her quite a lot recently. That’s because I’ve been drinking some blended Scotch whiskies and, for an article I’m writing, trying to get the distillers to talk about them. To summarise: they don’t have a lot to say.

Now my email in-box overflows on a daily basis with news of different single malts.  A constant stream of eager PR agencies and their clients vie for your attention with ever more exotic, expensive and esoteric releases of rare single malts. Often they’re limited to a few hundred bottles and, all too frequently, with a price tag running into four figures.

Dewar's White Label

They don’t make adverts like this any more.

They do, of course, provide easy copy for whisky magazines and bloggers and the proud brand manager is more than happy to see the column inches that result. They don’t, however, really mean terribly much in the grand scheme of things – while they’re the glamorous Spitfire pilots of whisky, the blends (the crews from Bomber Command if you want to keep this rather tenuous analogy going) do the grunt work.  They still account for more than 90% of all the Scotch sold around the world and without them, as I never tire of reminding folk, quite a number of single malt distilleries would have shut years ago.

The volumes of some of these brands are quite remarkable.  You know about Johnnie Walker, of course, and probably realise that blends such as Ballantine’s, Grant’s and Chivas Regal still sell impressive quantities (for the record, they each move considerably more than 4 million cases annually – that’s a lot of hooch).  But what about Passport, Buchanan’s, White Horse or Sir Edward’s? Well, any one of those sells more than 1½ million cases, leaving even the best-selling single malt gasping in their wake. 

In fact, brands that have been more or less forgotten on the UK retail scene such as VAT 69 and even Teacher’s still comfortably break the 1 million club barrier. And the ‘value’ brands that grace French supermarket shelves can clock up some remarkable numbers. Label 5 for example, which you’d be forgiven for not calling to mind, is a powerhouse performer selling close to 3 million cases.  Even more remarkably, the William Peel brand does even better.

So what’s the problem?  Why don’t we hear more about these whiskies? Well, some of it is pure snobbery – especially in the UK and US markets, blends are rather looked down on (not least, it has to be said by whisky writers and bloggers). The rot started with one of my personal whisky heroes, the author Aeneas MacDonald, who back in 1930 with his marvellous polemic Whisky (still in print, incidentally, and still well worth reading) chastised blended whisky drinkers as “the swillers, the drinkers-to-get-drunk who have not organs of taste and smell in them but only gauges of alcoholic content, the boozers, the ‘let’s-have-a-spot’ and ‘make it a quick one’ gentry and all the rest who dwell in a darkness”. Other writers have followed his lead.

Dr Jim Beveridge

Softly-spoken and unassuming, Dr Jim Beveridge from Johnnie Walker

Then there’s the undeniable fact that selling lots and lots of the same whisky day after day makes for rather less compelling copy than a stream of new releases.  There’s only so often that story can be written.

But there are stories to tell about blends and blending, even if blenders by inclination seem to be quite a modest breed, preferring the quiet sanctuary of their blending room to the stage at a large public whisky event. To their credit, Diageo did try some years ago to bring blending to the fore, holding a series of educational seminars for trade and media and releasing late in 2012 an elegant and erudite little pamphlet on The Art of Blending.

What’s more, their signature Johnnie Walker blend has proved adept at stealing malt whisky’s PR clothing. For proof, look no further than the recently released John Walker Last Cask.  There are just 330 bottles available worldwide (that’s if the Chinese leave us any, as it’s released there first) at approximately £2,500 each. 

So come on whisky marketers!  Let’s hear it for the engines of whisky’s success!  Let’s hear it for the mad aunt in the attic!

Though he has neither a beard nor any visible tattoos or piercings, Ian Buxton is well-placed to write about drinks.  A former Marketing Director of one of Scotland’s favourite single malts, his is a bitter-sweet love affair with Scotland’s national drink – not to mention gin and rum, or whatever the nearest PR is pouring. Once, apparently without noticing, he bought a derelict distillery. Follow his passionate, authentic hand-crafted artisanal journey on the Master of Malt blog.  Or just buy his books.  It’s what he really wants.

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Hops and grass, a match made in heaven?

As various Conservative politicians tumble over themselves to admit their early experiences with drugs of varying illegality, but within limits naturally, it seems as good as time as any for…

As various Conservative politicians tumble over themselves to admit their early experiences with drugs of varying illegality, but within limits naturally, it seems as good as time as any for Ian Buxton to look into the drinks industry’s flirtation with weed.

Yes, cannabis.  Or dope, grass, bhang or pot – call it what you will, it’s currently taking up a great deal of the time, attention and budget of the drinks industry’s senior executives.  Not that they’re smoking the stuff or baking it into their lunchtime snacks, you understand, but a lot of money is changing hands. Cannabis is shaping up to be the next big thing after alcohol.

Much of the activity currently takes place in North America. Canada has liberalised its laws on cannabis and a number of US states are poised to follow. Cannabis-infused drinks are under active development with brewers leading the way. As just one example, giant Canadian brewer Molson Coors took a majority stake in August 2018 in a joint venture with cannabis producer, The Hydropothecary Corporation. It’s taken the resulting Hexo Molson company less than a year to develop their first products, which will go on sale this December as soon as they become legal in Canada.

And what happens in Canada crosses the border to the US fast though currently Federal law prohibits brewers from using marijuana in beer. That hardly presented a problem to the noted craft brewer Keith Villa, the man behind Blue Moon Belgian Wheat Beer. His Ceria Grainwave Belgian-Style White Ale has no alcohol and but includes 5 milligrams of THC, the high-producing ingredient found in cannabis plants. It’s currently available in Colorado, with further distribution planned.

Ceria Brewing

Image courtesy of Ceria Brewing Company

Likewise San Diego’s Two Roots Brewing Co. which has five styles of non-alcoholic THC beer available in California and Nevada. Other craft brewers are piling in, and this hybrid category is rapidly gathering momentum. Apart from the obvious attraction, drinkers seem to be motivated by the wellness trend that is attracting younger US consumers – an alcohol-free buzz definitely fits with the millennial zeitgeist.

A few craft brewers doing funky things is all very well, however, but what about the big boys.  Well, they won’t all fess up to their plans but, behind the scenes, work is definitely going on.  After all, as Spiros Malandrakis, Euromonitor’s senior alcoholic drinks analyst explains, the industry needs to realise that it can’t stop cannabis’ inexorable rise. The management “can complain”, he says, “but this is going to happen. They can either sit in their offices and say: ‘Oh my God, our industry’s going to die,’ or they can do something and evolve alongside it.”

And, of course, they are. Heineken, for example, owns California’s Lagunitas Brewing, maker of Hi-Fi Hops.  According to their ‘Brewmonster’ Jeremy Marshall, “We’ve often dreamed of hops and their cannabis cousin partying together at the family reunion. We wanted to bring this party to life in a beverage. It’s high-time that good beer inspired a provocative, yet refreshing non-alcoholic alternative. With a smidge of California sun-grown cannabis in every sip.”

For the moment, Diageo has yet to make a move.  Though rumoured last year to be in talks with three Canadian cannabis producers the official line is that they are “watching” the market but that cannabis-infused alternative drinks have yet to make any discernible impact on their North American sales. “I wouldn’t call them a threat,” says their North American chief Deirdre Mahlan.  

Cannabis, coming soon to a bar near you (if you live in Canada or Colorado)

Pernod Ricard take much the same line.  According to CEO Alexandre Ricard: “We’re seriously monitoring the situation and starting to consider if it (cannabis) would or would not fit in our portfolio.” He went on to say: “We’re not there yet, we’re currently just analysing the data and observing the market from a consumer point of view in a number of US states and Canada. At this stage, and let me be very clear, we have no evidence whatsoever that cannabis legalisation may have an impact on premium spirits consumption.”

Well, perhaps not.  But others don’t agree. Legal marijuana in the US is predicted to reach a value of $23bn by 2022 and that’s too lucrative a market to ignore. Step forward Constellation Brands, a major US drinks business (products include Corona Extra lager; Casa Noble Tequila; High West whiskey and strategic investments in a number of craft distillers), who last year pumped almost $4bn into Canopy Growth, a Canadian cannabis group. This followed a previous smaller investment which made Constellation the first Fortune 500 company and the first major alcoholic beverage maker to take a minority stake in a marijuana business.

Others will surely follow.  Let’s hope their money doesn’t go up in smoke.

Though he has neither a beard nor any visible tattoos or piercings, Ian Buxton is well-placed to write about drinks.  A former Marketing Director of one of Scotland’s favourite single malts, his is a bitter-sweet love affair with Scotland’s national drink – not to mention gin and rum, or whatever the nearest PR is pouring. Once, apparently without noticing, he bought a derelict distillery. Follow his passionate, authentic hand-crafted artisanal journey on the Master of Malt blog.  Or just buy his books.  It’s what he really wants.

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Whisky and honours

Today Ian Buxton toasts Dr Jim Beveridge from Johnnie Walker who has just received an OBE and looks into the occasionally murky world of whisky and honours. As you may…

Today Ian Buxton toasts Dr Jim Beveridge from Johnnie Walker who has just received an OBE and looks into the occasionally murky world of whisky and honours.

As you may have read recently, Dr Jim Beveridge, master blender for Johnnie Walker has been appointed an Officer of the Most Excellent Order of the British Empire (OBE) in the latest Queen’s Honours list.  It couldn’t happen to a nicer or more modest chap – and he joins an exclusive group of whisky notables. In 2016 David Stewart, the long-serving malt Master at the Balvenie, was awarded the MBE while his opposite number at Glen Grant, Dennis Malcolm received an OBE – one rung up the awards ladder.  More recently, Nigel Mills, co-founder and chairman of The Lakes Distillery was appointed a CBE (a couple of steps up the awards hierarchy) while, at the same time, David Gosnell of Bushmills received the OBE.

Dr Jim Beveridge

Dr Jim himself!

So I expect by now you’re wondering, what are these awards, who else in whisky has received one and, most interesting of all, how are they decided?  There is no particular mystery about the British awards system. The aim is to recognise people who have made achievements in public life, or committed themselves to serving and helping Britain: “they’ll usually have made life better for other people or be outstanding at what they do.” as it says on the www.gov.uk/honoursThere’s nothing obscure about that and, other than the staunch republicans among us, we can probably agree that it is appropriate to recognise exceptional achievement or national service.  But who decides and how do they know who is worthy?

Though these are the Queen’s Awards, it’s not actually Her Majesty who decides. Specialist committees, comprising senior civil servants along with people who are independent of government, recommend awards to a main committee who then forward them to the Prime Minister’s office and then to the Queen. If you know someone particularly deserving, you can nominate them on the website. 

This system was introduced by John Major as Prime Minister but previously the basis for an award was, at best, opaque and, at worst, corrupt. There may have been some skulduggery surrounding the so-called ‘Whisky Barons’ of the 1920s ennobled by Prime Minister David Lloyd George, most notably the creation of Lord Woolavington (formerly James Buchanan). It is said that he paid handsomely for his peerage – allegedly, the sum of £50,000, or about £2m today – but signed the cheque with his new title and dated it for one day after the announcement was due, to ensure that the wily Lloyd George would honour the new honour!  But rest assured Messrs Beveridge, Stewart and Malcolm haven’t written any dodgy cheques! Their awards are strictly on merit.

Jim Beveridge

Dr Jim in action

Though there have been some involved with whisky production who have received gongs, like Ronald Martin from United Distillers (1931-2005, awarded OBE in 1991) or Professor Geoffrey Palmer from Heriot Watt University who received an OBE in 2003, the most senior awards, including knighthoods tend to come from the commercial side of the business.  Examples include Sir Anthony Tennant (1930 – 2011), knighted in 1992 for his work at IDV and at Guinness following the ignominious departure of Ernest Saunders, and Sir George Bull, knighted 1998, having been one of the principal architects of the then-largest merger in UK corporate history with the union of Grand Metropolitan with Guinness to create Diageo. A more recent business knight is Sir Ian Good, chairman of the Edrington Group from 1994 to 2013.  He was knighted in 2008. Interestingly, his predecessor John Macphail (1923-2004) received the lesser award of CBE, despite his obituary describing him as “one of the most inspirational and influential figures in the Scotch whisky industry”.

So here’s to all the distinguished individuals mentioned here, and all the others that I should have saluted but have omitted. Let’s raise a glass to their contribution to whisky, along with the hope that the new generation of distinguished whisky women will shortly have their special place in history.  

Who will be the first women in whisky to be honoured?  I leave it to you to speculate…..

Though he has neither a beard nor any visible tattoos or piercings, Ian Buxton is well-placed to write about drinks.  A former Marketing Director of one of Scotland’s favourite single malts, his is a bitter-sweet love affair with Scotland’s national drink – not to mention gin and rum, or whatever the nearest PR is pouring. Once, apparently without noticing, he bought a derelict distillery. Follow his passionate, authentic hand-crafted artisanal journey on the Master of Malt blog.  Or just buy his books.  It’s what he really wants.

 

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Should Macallan raise prices to deter speculators?

In this week’s column, Ian Buxton looks at The Macallan Archival Series on which speculators are making a killing and ask whether the company is doing its duty to shareholders…

In this week’s column, Ian Buxton looks at The Macallan Archival Series on which speculators are making a killing and ask whether the company is doing its duty to shareholders by pricing the releases too low.

A free holiday with every bottle! 2,000 vacations must be won!

Chose from a week for two in Orlando (yours from just £413 per person) or, for under two grand you and a friend could jet off to Turkey and enjoy a fortnight’s all-inclusive stay in the Club Adakoy Marmaris. According to the Thomas Cook website it’s “designed for a new generation of travellers who want fun, lively holidays in hotels that have great design, casual but great quality dining, and a bar to match; surrounded by like-minded people and accompanied by the perfect soundtrack”. Sounds amazing.

And this fabulously generous offer comes courtesy of The Macallan Archival Series. Not familiar with this range? Well, it’s a somewhat self-congratulatory set of releases, which commemorate “the legendary Macallan advertising campaigns of the 1970s, 80s and 90s that took The Macallan name to a wider audience for the first time”.

There are four so far but a remarkable 24 are promised to complete the full set. Essentially, what you get is a slim but admittedly handsome hardback book containing old Macallan adverts; a USB stick (more ads) and a bottle of NAS Macallan, all packaged in a large presentation tin tricked up to look like a book. Almost any other brand (assuming it could bear to look back at its old ads) would produce a suitably lavish coffee-table volume but, being Macallan, they just had to be different.

The Macallan Archival Series

The Macallan The Archival Series – Folio 4

The Archival Series was first launched in 2015 and, according to the ever-reliable Andy Simpson of RareWhisky101, it was sold back then as being “for collectors”. At least, that’s what he says he was told. Each edition is limited to 2,000 bottles and you got one either by turning up at the distillery shop at just the right moment or being lucky in their email ballot. If you ‘won’ you had the right to buy a bottle.

And, at £195 plus shipping for the first three bottles (the fourth release is £250), the punters plunged right in. Those 2,000 bottles were gone before you could recite the sacred Six Pillars. And, big surprise, just as fast, lots of them were immediately flipped on the various whisky auction sites that now service the collector and investor market.

Though at first prices were slow to rise, the market soon cottoned on. If you lucked into a bottle and timed it right, there were big profits to be made – on just one site, for example, more than 650 bottles have been offered, with Folio 1 reaching £2,100 (all prices shown as hammer prices, i.e. before auction commission and charges); Folio 2 a slightly disappointing £1,300 (rather a lot of bottles offered all at once) but Folio 3 bouncing back to a handsome £1,900. That’s a cool £1,705 clear profit – far, far more than Macallan are making. Lanzarote here I come!

The Macallan Archival Series

Folio 3 fetched fees of £1,900 at auction.

Early sales of the current release, Folio 4, seem well set to smash the £1,000 mark – quite enough for a decent short break somewhere agreeable and, at risk of labouring the point, a considerable multiple on the distiller’s profit. Without, let’s not forget, the tedious bother of distilling, ageing and bottling the whisky; producing the book and tin; promoting the whole endeavour; dealing with lucky punters and disappointed fans and the sheer bother of packing and shipping bottles all around the world.

Now, back in 2012, when Diageo had woken up to much the same thing happening with its Port Ellen and Brora Special Releases, they simply hiked the price to something considerably closer to what the market was telling them the whisky was worth. If anyone was going to profit from their work, they reasoned, better it was them than some spivvy speculators. Cue predictable outrage on social media but Diageo stuck to its guns and doubtless, their shareholders were happy.

Now, this is where this gets interesting. What, we might inquire, do Macallan think they are doing? After all, there are 8,000 Archival bottles out there already and if very conservatively, we allow an average after-market bump of just £500 per bottle, that’s a secondary profit of at least £4 million that they seem content to hand over to whisky’s Arthur Daley types.

The Macallan Archival Series

The Macallan made its name through clever ad campaigns, something The Archival Series celebrates.

Macallan is part of the Edrington Group which, ultimately, is owned by a charitable body The Robertson Trust. This owes its existence to the remarkable foresight and altruism of the three last direct family owners, the Misses Robertson who, in 1961, transferred all their shares to a newly-established charitable trust in order that their family legacy would continue and ownership remain in Scotland. Today, The Robertson Trust aims to improve the quality of life and realise the potential of Scotland’s people and communities with a particular focus on health, social and educational inequalities. It’s important work and, with annual disbursements of more than £16 million, The Robertson Trust is Scotland’s largest independent funder.

I pause at this point to offer a self-congratulatory, virtue-signalling disclosure: I got a ballot bottle of Folio 3 which is now in the possession of an impecunious family member, to do with what he will. Charity, in this case, begins at home.

But I can’t ignore the fact that with another £4 million The Robertson Trust could increase their great and noble efforts by a quarter. I’ve emailed Macallan and requested their thoughts on the matter – if they reply, I’ll add to this post.

However, for the moment, ask yourself: would you pay more for an Archival bottle? Should you? Or where, I wonder, do you think the profit should go?

Though he has neither a beard nor any visible tattoos or piercings, Ian Buxton is well-placed to write about drinks.  A former Marketing Director of one of Scotland’s favourite single malts, his is a bitter-sweet love affair with Scotland’s national drink – not to mention gin and rum, or whatever the nearest PR is pouring. Once, apparently without noticing, he bought a derelict distillery. Follow his passionate, authentic hand-crafted artisanal journey on the Master of Malt blog.  Or just buy his books.  It’s what he really wants.

1 Comment on Should Macallan raise prices to deter speculators?

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