Wednesday, July 13, 2016

Will Cars of the Future Run on Distillery Waste?

A good, science-y picture from a different UK CAER project.
The University of Kentucky has a fascinating story out today about using stillage to make batteries and other useful products. It is in the experimental stage now, but the University of Kentucky Center for Applied Energy Research has partnered with Danville's Wilderness Trail Distillery to test the viability of the idea.

Stillage is a by-product of the distillation process. Unlike scotch, American whiskey is usually distilled from a mash, not a wash. In Scotland, Ireland, Japan, and most other places that make whiskey, solids and liquids are separated after all of the soluble starch in the grain has been liquefied. The liquid portion, known as the wash, goes forward into fermentation and distillation. The moist solids are considered waste and either used as animal feed or simply discarded.

In North America (U.S. and Canada) it is a little different because although the soluble starch is liquefied, just like in Scotland, the grain solids are not removed. Still known as mash it is a slurry, like a very thin oatmeal. It stays that way through fermentation and distillation. What comes out at the end of the process, after all of the alcohol has been removed through distillation, is stillage.

Keeping all of the solids adds flavor but American distillers do it mostly because they can. Since column stills are used for the first distillation instead of pot stills, the early removal of solids is unnecessary.

American distillers typically do separate their stillage into wet and dry components. It's a pretty simple process that leaves a few solids in the wet portion and a bit of moisture in the dry, but it is effective for its purpose. The wet portion is used as setback in the sour mash process. It is mixed with a new mash prior to fermentation. The wet stillage adds a little acid to the fresh mash, which the yeast likes, along with some yeast nutrients, which the yeast also likes.

Setback ratios vary but 1:3 is about the highest, so plenty of stillage is left over. The leftover wet stillage goes into the sewers. The dry portion (which is still pretty wet) goes to one of three places: (1) directly to farmers, who come and get it, for livestock feed; (2) processing that removes the rest of the moisture, which gives it a longer shelf life (it's still used as livestock feed); or (3) into the sewers.

The problem with stillage is that as a direct by-product of the process, the amount of stillage goes up as your production goes up. If there aren't enough nearby farmers willing to come and get it every day, option (1) isn't available. Although stillage is free to the farmer, the farmer has to pick it up and transport it. Even rural distilleries are having a hard time giving their stillage away under those terms, a problem that is compounded as the amount of stillage goes up.

Option (2) isn't great either because the processing (drying and other processes) needed to make the stillage something that can be packaged and stored is expensive. Although it's a good feed and does sell, as a product it barely breaks even, a situation that only gets worse as increased supply pushes the price still lower.

Option (3) is undesirable because not all municipal sewage systems can accept it and even when they can, it's adding to the waste stream when it could be used for something productive. If this project (which uses the wet portion) can find some new, value-added ways to use this material, that will be good for the whiskey industry and the environment.

Wilderness Trail Distillery is the natural partner for this project because it is a bourbon distillery run by scientists. The same folks own and operate Ferm Solutions, which supplies yeast and other products and services to distilleries in Kentucky and beyond. Formerly in downtown Danville, they have moved their operations to a new, much larger facility west of town. It is open to the public for tours.

That it is Wilderness Trail and not one of the majors involved in this is another example of how much the micro-distillery movement is contributing to the industry and to local communities.

Saturday, July 9, 2016

A Little Bit More About David Nicholson 1843

Thursday's post about the revival of David Nicholson 1843 was mostly based on information from Luxco, the brand's current owner, but the connection of the Van Winkle family's Stitzel-Weller Distillery to this small St. Louis brand seemed interesting, so I reached out to family members with direct knowledge for the rest of the story.

The first thing that struck everyone as wrong was the year Luxco acquired the brand. Luxco says it was 2000. The family says it was more like 1984 or 1985 when they sold the brand to the David Sherman Company. (The David Sherman Company was renamed Luxco in 2006).

They also explained that while Nicholson may have started out as a grocery store in 1843, it eventually became a large grocery products wholesaler whose lines included whiskey. They were a major outfitter for the wagon trains heading west from St. Louis. As the advertisement above shows, they also did business in the east, including in New York City.

The St. Louis distributor of the David Nicholson 1843 bourbon brand was the Peter Hauptmann Company, whose chief executive was Roger Anderson. Initially, there was a different distributor in Illinois and, in fact, the brand did a lot of its business on the Illinois side of the river.

After Prohibition, Hauptmann was owned by McKesson. Roger Anderson served in the 82nd Airborne Division of the U.S. Army in World War II, then went to work for McKesson in sales. In 1968 he became General Manager of McKesson's Peter Hauptmann wholesale liquor division in St. Louis. He retired from that position in 1993 or 1994 and died in 2013.

Until 1967, the Hauptmann company owned the David Nicholson 1843 bourbon brand. In that year, Foremost Dairies acquired McKesson-Robbins and the Hauptmann division was forced to sell the Nicholson brand due to cross-ownership rules. Separate from their ownership of Stitzel-Weller, the Van Winkle/McClure family acquired it.

It was a somewhat complicated relationship. The family owned the label and leased the '1843' name and label design (Gold '1843' and green thistle design) back to Hauptmann so they could continue to sell it as one of their 'premium in-house brands.' It was popular in St. Louis, MO; East St. Louis, IL; and Alton, IL. Hauptmann bought the whiskey from Stitzel-Weller and paid Stitzel-Weller to warehouse and bottle it. When the whiskey was shipped, the Van Winkle/McClure family was paid a royalty for use of the brand on a per-case basis.

The contract had an annual renewal but since it was a seven-year-old product, that meant there would be seven more years of agreement so there would be seven more years of whisky in the warehouses at Stitzel-Weller. If it was not renewed, then the contract would actually terminate after six years.

In the 1970s, they introduced a 'Black Label 1843' that was down-proofed to 92° to reach a lower price point. This was the period when bourbon, especially premium bourbon, was dying all over the country.

This arrangement continued after 1972, when the Van Winkle/McClure family sold the Stitzel-Weller Distillery and most of its brands to Norton-Simon. Old Fitzgerald was the distillery's leading brand so Norton-Simon changed the distillery's name to the Old Fitzgerald Distillery. That distillery stopped producing in 1992 and production of its wheated bourbon was shifted to the new Bernheim Distillery. When United Distillers (which became Diageo) sold Bernheim and the Old Fitzgerald brand to Heaven Hill in 1999, it retained the then-mothballed Old Fitzgerald Distillery, which became known as Stitzel-Weller again.

Although it never distilled again after 1992, Old Fitzgerald/Stitzel-Weller remained active as a maturation and bottling facility. Eventually the bottling house was closed and bottling was transferred to Owensboro and a large, modern bottling house United Distillers acquired when it bought Glenmore, also in 1992. The Owensboro facility, which also includes maturation warehouses, was sold to Barton and later acquired by Sazerac, which owns it today.

In the Glenmore acquisition, United Distillers also got the Medley Distillery, on the other side of Owensboro. When New Bernheim opened they stopped distilling at Medley too and sold the facility to its last Master Distiller, Charles Medley, who never reopened it. Last year, Terressentia bought that distillery and renamed it O. Z. Tyler.

Diageo stills owns the Stitzel-Weller facility, which it uses for maturation and blending, and as a 'homeplace' for its Bulleit Bourbon brand.

At its peak, David Nicholson 1843 sold about 40,000 cases a year. When the David Sherman Company bought it in 1984-85, volume had declined to about 6,500 cases a year. In 1999-2000, the David Sherman Company acquired the Rebel Yell brand and Heaven Hill bought the Bernheim Distillery, which is probably when Heaven Hill became supplier of the whiskey. (Which no one, of course, will confirm.)

Apparently, the David Sherman Company bought Hauptman about the time of Roger Anderson's retirement in 93-94. Anderson remained active in the business until his death and was the St. Louis broker for J. P. Van Winkle and Son.

This is all very inside, of interest to only a few people, but we work hard to get this stuff right and appreciate everyone who generously helps.

Thursday, July 7, 2016

New Look, Life for David Nicholson 1843

St. Louis-based Luxco has been upping its bourbon game by launching new brands, refreshing and extending existing brands, and even building a Kentucky distillery that is scheduled to open next year. Two years ago, Luxco acquired a half-interest in Kentucky craft distillery Limestone Branch and transferred to Limestone its ownership of Yellowstone Bourbon, an historic bourbon brand associated with the family of Limestone's owners. 

Now it is the turn of David Nicholson, a bourbon sold primarily in and around St. Louis. The story is that David Nicholson was a St. Louis grocer who started to make bourbon and sell it in his store on North 6th Street in 1843. He probably wasn't a distiller but may have been a blender.  

David Nicholson 1843 was always a regional product and after Prohibition it was made by Stitzel-Weller for the Peter Hauptmann Company, or so said the label. Hauptmann was primarily known as a seller of tobacco products and he died in 1904. There is evidence that the company was in business until at least 1921, but nothing post-Prohibition. It is possible "Peter Hauptmann Co, St. Louis, MO" was just a Stitzel-Weller DBA, validated as a 'real' address via a P.O. box.

In modern times, the David Nicholson 1843 brand was notorious within the small circle of hard-core bourbon enthusiasts for showing its distillery as DSP-16 (i.e., Stitzel-Weller) long after the supply of Stitzel-Weller whiskey was effectively exhausted. Luxco claims the error was a simple oversight, they just kept re-printing the label as it was. This is plausible since only bottled-in-bond (BIB) products must show the producing distillery on their label, and BIBs are a very small segment of the market. Likewise, David Nicholson 1843 has always been a very small brand, even for Luxco.

As a Stitzel-Weller product, David Nicholson 1843 was a wheated bourbon, the same basic liquid as Old Fitzgerald, W. L. Weller, Cabin Still and the rest of the line, including Rebel Yell which Luxco also now owns. It continued as a wheater even after the source of the whiskey changed. The re-launched version is still a wheater and still 100° proof, although it is no longer BIB. Suggested retail is $29.99 to $34.99.

New to the Nicholson line is David Nicholson Reserve, a rye recipe bourbon, also 100° proof and also not BIB. Suggested retail is $34.99-$39.99.

Both bottles have cork tops. Neither has an age statement.

Part of the pitch for David Nicholson is that since 95 percent of brand volume comes from Missouri and Illinois, it has huge growth potential in new markets. Luxco reports that David Nicholson 1843 was up 11 percent in 2014 vs. the previous year.

Although Luxco is building a distillery in Bardstown, it is currently a non-distiller producer. Luxco used to disclose that it got most of its bourbon from Heaven Hill. These days they won't say but will say that their whiskey comes from more than one source.

Luxco was founded in St. Louis in 1958. Its portfolio includes Juarez Tequila & Triple Sec, Pearl Vodka, Everclear Grain Alcohol, Arrow Cordials, El Mayor Tequila, Ezra Brooks Bourbon, Lord Calvert Canadian Whisky, St. Brendan’s Irish Cream, Salvador’s Cocktails, and Yago Sant’ gria.

Tuesday, July 5, 2016

Kentucky Keeps Getting Wetter

As the Lexington Herald-Leader reported Sunday, the Commonwealth of Kentucky used to prohibit alcohol sales in most of its 120 counties, but that has changed. The recently-compiled map shown above is already out-of-date. In elections last week, voters approved legal alcohol sales in Cumberland and Metcalfe counties, while Williamsburg and Mayfield residents voted for expanded sales.

Although Kentucky is the country's leading whiskey producer, the state tends to be very conservative and has had a fraught relationship with its signature industry. Unlike California, which keeps its state alcohol taxes relatively low to encourage its wine industry, Kentucky has some of the highest retail alcohol taxes in the country.

It is no coincidence that the counties and cities with large Catholic populations make most of the bourbon and are solidly wet. Alcohol-phobia is an affliction that mostly affects Protestant Evangelicals.

The engine driving legalization is primarily economic. In even the driest counties it is legal to possess and consume alcohol, only sales are prohibited, so drinkers simply make their alcohol purchases in the nearest wet jurisdiction. Dry counties lose that business and the associated tax revenue. Restaurants struggle to survive in places where alcohol sales are not allowed as that business also goes elsewhere. Tourism, Kentucky's third-largest industry, suffers where alcohol cannot be sold.

On the map, you will notice that there are three main classifications, not two. The third is 'moist' counties. A 'moist' county may be dry but with one or more cities within its borders that are wet. Kentucky law also allows counties to authorize sales in certain restaurants and other venues, such as country clubs. This ability to authorize limited sales in restaurants without allowing bars or package stores became law in 2000. It dealt with the 'not-in-my-backyard' issue for many.

(Go here for a county-by-county list describing the moisture level in each.)

One of the allowed exceptions has been sales at wineries. Kentucky's rapidly growing craft distillery industry is looking for the same consideration, although currently most distilleries are in areas that are already wet.

Limited sales have limited benefits in terms of economic development, so the trend to full legalization has also picked up steam in recent years.

Carol Beth Martin, malt beverage administrator for the state, said this to the Herald-Leader. “In my opinion, as places nearby go wet, people are able to see that, if regulated appropriately, alcohol sales can be a benefit for a community as opposed to a nuisance,” said Martin. “Alcohol sales oftentimes bring increased economic development to the community as well as provide an increase in tax revenue addressing quality of life issues in their community.”

One aspect not often discussed is bootlegging. Every dry area has them. Bootleggers are people who buy alcohol legally in wet locations, transport it into dry ones, and sell it illegally at a considerable markup. Bootleggers, of course, do not bother with laws. They are always open and will sell to anyone, including underage drinkers. Bootleggers tend to be behind-the-scenes supporters of the status quo in dry counties.

Although it has made progress, Kentucky still has a long way to go, but after 80+ years the long shadow of Prohibition continues to recede.

Friday, July 1, 2016

Another Take on Jack Daniel's 150th Anniversary

A few days ago, we posted about Jack Daniel's phony 150th anniversary. Our good friend Down Under, Chris Middleton, the former Global Brand Director for Jack Daniel’s, contributed the following.

There may prove to be a grain of truth in the Jack Daniel’s claim of 150 years distilling at the Cave Spring, thereby probably being the oldest registered whiskey distillery in continuous operation, excluding periods of State and Federal Prohibition.

Jack Daniel may have only started distilling at the Cave Spring in 1884, but the distillery may have older antecedents.

This story begins with Joseph Hiles and William Berry who allegedly purchased the land surrounding the Cave Spring in 1817, and erected a grain mill. At some point they built a still house, the exact date is not known. Some books credit Wilburn Hiles and William Berry as the original owners; however, Wilburn was only born in 1826 and William Berry in 1776. Whether it was Berry’s son inherited or later bought this land and then partnered with Joseph Hiles’ son Wilburn (born 1826) or Walton (born 1831); I have been unable to verify. 

Regardless of both genealogical lines, Hiles & Berry were operating a distillery at the Cave Spring soon after the Civil War ended. They had allegedly ceased distilling before they put the Cave Spring property on the market. Hiles & Berry distilled 44 bushels or 110 gallons a day by 1877. This was the 142 acres Jack Daniel purchased from them June 14, 1884, for $2,180.40. Daniel & Call distillery (1876 – 1882), down the creek was five bushels a day less than the Hiles & Berry. 

In all likelihood, the Hiles & Berry families operated a still at the Cave Spring site possibly before, but certainly immediately after the Civil War. Tennessee was granted readmission to the Union on July 24, 1866, so it came under the jurisdiction of the U.S. Government’s July 1, 1862 regulation registering still and boiler capacities. Any distillery operating in Tennessee was required to be registered and a Treasury gauger appointed to monitor daily production, e.g. assistant deputy tax collector J W Bryant supervised Lynchburg’s half dozen distilleries in 1877. 

This line of inquiry would indicate that a still house had operated at the Cave Spring site since the introduction of still registrations in Tennessee from late 1866. If Jack Daniel had been able to transfer the distillery registration to himself as part of the Hiles & Berry deal, then the distillery claim may prove true. If not, they are celebrating 132 years.

In close pursuit, subject to how you define ‘continuous’ distillery operations at the same location, Ripy brother’s Tyrone distillery at Lawrenceburg Kentucky (now Wild Turkey) is the closest contender for a distillery consistently operating at the same site since 1869, and very likely registered.  Woodford Reserve distillery was a rebuild on the Old Oscar Pepper distillery site of 1790. Then there’s Laird & Co in New Jersey, which preceded the formulation of US Government of 1789 when New Jersey became an independent colony and first taxed distilleries in 1777.

Saturday, June 25, 2016

Kentucky Mist Case Not Exactly What It Seems

There is something wrong with the way the Kentucky Mist v. University of Kentucky (UK) case is being reported and it is embodied in these two photographs from the Lexington Herald Leader (Kentucky's best news source, by the way). 

From most of the reports about this case it is easy to arrive at the following conclusions: (1) Kentucky Mist is a tiny, fledgling company being stomped on by a giant university. (2) UK wants to 'own' the word 'Kentucky' and prevent anyone else from using it. (3) The U.S. District Court for the Eastern District of Kentucky has sided with the big, bad university.

The proof that things are not exactly as they seem is in these pictures. The sign on the building says 'Kentucky Mist Moonshine.' The hats and other apparel they sell inside say 'Kentucky Mist Moonshine.' The name 'Kentucky Mist Moonshine' appears on all of the company's products.

Has UK made any effort to stop Kentucky Mist from using the name for any of those purposes? The evidence shows that it has not. UK merely objected to Kentucky Mist's effort to trademark its name for purposes such as use on apparel. The University of Kentucky already has a trademark for those purposes. UK is not objecting to Kentucky Mist trademarking its name for distilled spirits products and no one is objecting to Kentucky Mist actually using the name on apparel.

“The plaintiff here misstated UK’s intentions early on, attempting to create a controversy,” wrote Judge Danny Reeves in his decision. According to the New York Times, UK objected to Kentucky Mist's filing originally because they wanted to get an agreement from Kentucky Mist that it wouldn't use Royal Blue and White for its apparel, which are UK's colors. Instead of negotiating, Kentucky Mist filed suit. The result has been a lot of press coverage, millions of dollars worth of free publicity for Kentucky Mist.

So what about Kentucky Mist Moonshine itself? Well, 'moonshine,' first of all, is not a type of distilled spirit. It is any distilled spirit made illegally. So 'Legal Moonshine' is an oxymoron. Distillers and marketers use it to tap into the term's romantic outlaw connotations, especially in Kentucky's eastern mountain region where Kentucky Mist is located. Since moonshine isn't a type of distilled spirit, the product's actual type must be shown on the label. Kentucky Mist is 'spirits distilled from cane,' so sugar shine, a mash made from sugar (the same stuff you put in your coffee) that is fermented and distilled, at some alcohol concentration below neutrality (i.e., less than 95% ABV). 

That is pretty authentic. Table sugar is what most 'real' (i.e., illegal) moonshiners use because it is readily available, cheap, and easy to ferment. According to their web site, Kentucky Mist actually distills its product, unlike some well-known moonshine marketers who use commercially produced GNS. That's a good thing. Not so good is their attempt to link the founder's moonshining ancestor to Al Capone when both were in Atlanta Federal Prison. Capone was there only from 1932 until 1934 and already suffering from the syphilis that destroyed his mind. That the progenitor of Kentucky Mist "formed a good friendship" with Capone as claimed is highly unlikely.  

Legal alcohol producers should think twice before associating themselves with criminals and criminal activities.

The web site writer also doesn't understand the difference between a moonshiner (a maker of illegal spirits) and a bootlegger (a person who sells spirits illegally). 

Kentucky Mist seems to feel it has been done a great injustice but the facts say otherwise.

Tuesday, June 21, 2016

Today, Jack Daniel's Celebrates Its Fake 150th Anniversary

This morning, Brown-Forman celebrated the 150th anniversary of the Jack Daniel Distillery by ringing the opening bell at the New York Stock Exchange. They hung a huge banner on the outside and lined up all of their executives on the inside.

There is just one small problem with this celebration. It's a big fake.

The company has long claimed that “Mr. Jack Daniel was the first to register his distillery with the government in 1866, making it the oldest registered distillery in the United States of America.”

You would think that such a claim, involving registration with the federal government a mere 140 years ago, would be, well, on record somewhere and easy to check.

It isn’t.

Brand owner Brown-Forman says it has relied on information “passed down from generation to generation.” The available records, it says, are “inconclusive” due to the upheaval of the Civil War, Reconstruction, courthouse fires and Prohibition.

The ‘oldest registered distillery’ claim has been repeated so often, no one thinks to question it. Yet we are asked to believe that the federal government in 1866 decided to start registering distilleries for tax collection purposes and a 16-year-old boy in rural Tennessee was the first to comply.

Peter Krass, author of 2004’s Blood & Whiskey: The Life and Times of Jack Daniel, says Daniel's was not the first registered distillery in the country and never won a gold medal for world's best whiskey either. Krass says land and deed records show Daniel didn't even go into business until 1875, when he would have been a more realistic 25. Krass also says it's impossible that Daniel's was the first registered distillery because many Northern distilleries were registered long before 1866 to comply with revenue laws.

Depending on what you mean by ‘registered’ (which Jack Daniel's has never defined), the first ‘registered’ distilleries in the U.S. had to have been the ones that complied with the first federal liquor excise tax, levied on July 1, 1791.

The tax was on and off for about 30 years until it was abolished in 1818. Reimposed in 1862, it has been with us ever since. The rate was raised twice in 1864 and again in 1865. While the Civil War was underway, distilleries in areas not under control of the Union did not pay the tax, but plenty of distilleries in Union states got 'registered' and began to pay in 1862.

As consumer packaged goods go, whiskey was one of the earliest. Many claims were first made before anyone even conceived of ‘truth in advertising’ as a value. To some extent they were grandfathered in when the government began to police product claims in the early 20th century. No one means any harm. It has simply become part of the brand’s fabric, its background music.

No doubt this is not the first time a fiction has been trumpeted as fact at the NYSE and it surely won't be the last.