MGPI to Close Founding Plant, Become Different Company

 

MGPI, Atchison, Kansas.

If you noticed in the news that MGPI will close its grain neutral spirits distillery in Atchison, Kansas, you may have thought, "Ho hum, one less industrial alcohol distillery. So what?"

The straightforward press release from MGPI soft-pedals the significance of this announcement. It contains all the information investors and other industry participants care about. The news is all there, accurately reported, with all necessary disclaimers, but there is much more to the story.

First, the business angle. MGPI is exiting the business that sustained it for most of its 82 years, the manufacturing of ethanol from corn. It's a different company now, especially since the acquisition of Luxco two-and-a-half years ago. It has other businesses but is now primarily a distilled spirits producer, leading with American whiskey.

Second, the history angle. This distillery in Atchison is where it all began for MGPI in 1941. It is the distillery Cloud Cray bought and expanded to make ethanol for the WWII war industries. He called it Midwest Grain Processors, later abbreviated to MGP. The "I" was added to represent 'ingredients.' 

The company's Ingredient Solutions business will continue to operate in Atchison. It processes corn, wheat, and other grains into fiber, protein, and starch for use in a variety of foods.

This move isn't entirely unexpected. They started on this path in 2011, when they bought the former Seagram's distillery in Lawrenceburg, Indiana, now called Ross & Squibb.

MGPI is public but still tightly controlled by its founding Cray family. Cloud Cray’s son, Bud, who succeeded him, passed away in 2020 at age 96. Bud's daughter, Karen Seaberg, chairs MGPI’s board today. 

MGPI has an image problem, in that they don't seem to know what they want their image to be. Two-and-a-half years into the Luxco acquisition, they haven't integrated well. They can't even settle on a corporate name. It is MGP in some places, MGPI in others, and MGP Ingredients, Inc. in still others. 

Their Luxco business still does business as Luxco.

Perhaps this plant closure is what they've been waiting for. Although they still make ethanol at Ross & Squibb in Indiana, it's probably not enough to support their internal need for neutral spirit for their vodka, gin, blended whiskey, and cordials products. By exiting the unprofitable grain neutral spirits and industrial alcohol business, they have a chance to stamp the company with a new identity. They need to take it.

Maybe they'll go on a history binge when the place actually closes next year.

Should Your Favorite Whiskey Always Taste the Same?

 

Big whiskey companies are serious about consistency.

John Lunn, before he took the position of master distiller at George Dickel, got to meet Ralph Dupps, who built the Tullahoma distillery for Schenley in the 1950s. "Don't change a damn thing," was Ralph's only advice.

There is nothing the biggest whiskey companies take more seriously than consistency.

For some craft distillers, consistency is anathema and good for them. They want to be consistent only up to a point, then they want each release to be its own experience. 

That isn't how the majors see it. Their best customers are the 20 percent of drinkers who consume 80 percent of volume, 'heavy users,' with all the implications of that descriptor. They are brand loyalists. They drink every day and always drink the same thing the same way. Bitter experience has taught the big companies that they change a whiskey's flavor at their peril. Those precious heavy users will notice and they will not approve. 

They won't write blog posts about it. They'll just find a new favorite whiskey. 

Changing how a whiskey tastes is an even worse sin than raising the price. Some insiders attributed the rapid demise of Old Crow Bourbon to a small, unintended flavor change that occurred because of a distillery expansion in the 1960s.

This respect for brand-loyal customers who prize consistency made it hard for many companies to learn how to appeal to a new generation of whiskey enthusiasts whose values are different.

How do big distilleries ensure consistency? This post from 2022 asked the question, "Are Basil Hayden and Old Grand-Dad the Same?" That led to an explanation of flavor profiles and the way producers maintain them to ensure product consistency. A long explanation is there, but the short version is this:

When barrels are dumped for bottling, often hundreds at a time, their contents are mixed together in a big tank. 

Enough room is left in the tank for additional barrels to be added if necessary to adjust the product's flavor.

Samples from this new batch are then compared to a standard, "what it tasted like last time." This is done by the distillery's tasting panel. The master distiller has final say. They will tweak the blend until it's right.

Many distilleries have rooms full of plain, glass flasks (typically 500ml) labeled as to contents and when each was filled, shelf after shelf of them, a liquid archive. Quality control personnel can compare a current batch to not only the most recent batch, but to just about any batch of any brand the company has ever produced.

How many craft distilleries do this or anything like it? 

Some do, some don't. Some, like the majors, save not just samples of bottling batches but also samples of new distillate, distillate after one year in wood, etc. Even if you preserve just one sample from every bottling batch, sample bottles can add up quickly. Many craft distilleries start out cramped for space. Do most even have room for a liquid archive? 

Even if you're not trying to exactly match a profile with every batch, there are good reasons to keep a liquid record. When a problem arises, the first thing distillers do is go back to their archive to see if they can tell when the trouble started.

So, the headline above asks, "Should your favorite whiskey always taste the same?" Should it? That's entirely up to you. If you value consistency, the majors have you covered. If you believe variety is the spice of life, that's all right there for you too.

Lost Lantern Celebrates "Summer of Bourbon"

 

Lost Lantern's 2023 Summer of Bourbon Collection.

The 21st century has witnessed two dramatic changes in the distilled spirits landscape. First is the revival of American straight whiskey, especially bourbon and rye. Second is the explosion of craft distilling.

Because of both trends bourbon, until recently produced almost exclusively in Kentucky, is now made across the United States, "from Nevada's arid deserts to Texas' sprawling plains, from the snowbelt of Ohio, to the rugged mountains of Colorado," according to the folks at Lost Lantern, the independent bottler of American Whiskey founded by Nora Ganley-Roper and Adam Polonski, who have declared this "The Summer of Bourbon."

"We have never devoted such a large release entirely to one single style of whiskey," commented Polonski. "We want to showcase the incredible quality and ingenuity coming from all over the country."

Lost Lantern’s Summer of Bourbon collection features eight bourbons across three product lines: the Blend Series (blends of whiskeys from multiple distilleries), the Single Distillery Series (blends of multiple casks from a single distillery that showcase a unique side of that distillery), and the Single Cask Series (whiskeys from a single barrel from a single distillery).

The blend is called Far-Flung Bourbon (582 Bottles | 136.8 Proof) SRP: $110

The single distillery bourbon is Soaring Spice Frey Ranch Distillery Nevada Straight Bourbon Whiskey (900 Btls | 127.6 Proof) SRP: $100

The bourbons from the single cask series are: 

Frey Ranch Distillery Nevada Straight Bourbon Single Cask (217 Btls | 137.2 Proof) SRP: $110

Boulder Spirits Colorado Straight Bourbon Single Cask (151 Btls | 142.6 Proof) SRP: $120

Ironroot Republic Texas Straight Bourbon Single Cask (167 Btls | 137.3 Proof) SRP: $120

Still Austin Texas Straight Bourbon Single Cask (167 Btls | 103.8 Proof) SRP: $80

Tom's Foolery Ohio Straight Bourbon Single Cask (171 Btls | 113.8 Proof) SRP: $120

New Riff Kentucky Straight Bourbon Single Cask (214 Btls | 114.2 Proof) SRP: $90

The Summer of Bourbon releases are non-chill-filtered, bottled at natural cask strength, and transparently labeled with the source distillery or distilleries on the label.

On the subject of dramatic changes in the American distilled spirits landscape, the recent emergence of independent blender-bottlers such as Lost Lantern is another one. You pay for curation, of course, but with nearly 3,000 distilleries operating in the USA right now, it's hard to know what to try. A curator can help. They research and taste a lot of stuff so you don't have to.

“The Summer of Bourbon shows that great bourbon can take many different forms,” says Ganley-Roper. “It can be made in many different ways in climates and aging conditions that are utterly different from each other, having a huge impact on flavor. This incredible diversity of styles and flavors is part of what makes the bourbon world so exciting.” 

In the United States, We Take Our Whiskey Personally

"A conversation with Mr. Van Winkle."

The question was one of those clickbait things on social media. "To whom do you turn when the going gets rough?" More than one person answered, "Jack Daniel's."

Americans like that about our whiskey. In Scotland and Ireland, whiskies are named after places, with a few notable exceptions. (Yes, Mr. Walker. We see you.) In the U.S., the most popular whiskeys are mostly named after people.

We have Jack and Jim, of course, Elijah, Ezra, Evan, Elmer, Issac, Jimmy, Parker, George, Abraham, Augustus, Cyrus, and Pappy. I'm sure I missed a couple. Back in 1989, George Jones sang, "Last night, I broke the seal on a Jim Beam decanter that looks like Elvis. I soaked the label off a Flintstone Jelly Bean jar." I worked on the Jim Beam account at the time. Beam never made an Elvis decanter (that was McCormick), but the folks at Beam sure did love that song.

When the bourbon category was dying, it seemed like any brand with "Old" in its name was declining fastest, even though most of those were people's names too, e.g., Crow, Taylor, Fitzgerald, Weller, Pepper. If you had a round bottle with "Old" in the name, you were screwed. Square bottle with a full name on it, you were okay. I worked on Early Times. They couldn't change the name but did switch to a square bottle.

When sales are crashing, you try anything.

My dad, who enjoyed Van Winkle Rye, would say he looked forward to "a conversation with Mr. Van Winkle" after an especially taxing day.

Back then, it wasn't hard to get Van Winkle Rye, but it was one of the most expensive American whiskeys on the market. Dad and I would talk about whiskey from time to time and he said he remembered rye from his youth (the 1940s) tasting like rye bread, so I got in the habit of bringing him different ryes to try, to see if we could find one that scratched that itch for him.

I went through almost everything before I got to the Van Winkle, not so much because of the cost as because I thought it very bourbon-like, which was what I liked about it, but it certainly did not taste like a traditional rye. This was about 15 years ago, when there weren't as many ryes as there are now. After he'd had the Van Winkle a few times, he commented, "It doesn't taste like rye bread, but I sure do like it." 

That ended our quest for a rye-bread rye but I kept him supplied with Van Winkle Rye thereafter. When he died, there was about a third-of-a-bottle in his cabinet. I finished it for him.

Who Makes America's Whiskey Now?

 

A photo from the American Craft Spirits Association to represent craft spirits.

Seven years ago, it struck me that for all the sound and fury about new brands and new distilleries, things had not changed very much since I made a similar survey two years before. In my 2014 book, Bourbon, Strange, I wrote that just eight companies distilled all of America’s whiskey at just thirteen distilleries. Two years later, it was ten companies and fifteen distilleries. Today, well, it’s a lot more of both.

I was looking at it in 2016 because so many new distilleries were debuting later that year or in 2017. We had folks such as Angel’s Envy who were underway but still ramping up. This is always a moving target.

The ”all” in both statements is more properly “virtually all.” Of the 2,500 or so distilleries now operating in the U.S., most produce very little, a drop in the bucket of total U.S. whiskey production. Even all put together they don't amount to much. That’s not a knock, just a fact. As the American Craft Spirits Association (ACSA) puts it: 

“The U.S. craft spirits market is fairly concentrated with larger producers making up only 1.6% of the total number of craft producers, but are responsible for 56.6% of the cases sold. 90.1% of U.S. craft producers are classified as small producers. They are responsible for just 10.3% of the cases sold annually.” 

The ACSA does not even count producers who make more than 750,000 proof gallons annually. For my list, I put the cut-off a bit lower, at 500,000. If I hadn’t, the number would not have changed at all.

The ACSA figures are also for all spirits, they don’t break out whiskey. 

Overall, the data is not there for the picking. You have to suss it out. With whiskey, it’s hard to know what to count, since the product the companies are selling now was distilled four to ten years ago. Do you count how much they’re selling or how much they’re making? 

Neither number is readily available, but since distillery output is forward-looking, let’s stick with that. Only one of the four biggest companies, Brown-Forman, is public so they have to disclose that sort of thing. The other three—Beam Suntory, Sazerac, and Heaven Hill—only disclose what they want to disclose. So, the results of this exercise should be considered as falling somewhere between a rough estimate and an educated guess. Feel free to improve it if you can.

In 2016, the two companies not on the 2014 list were New Riff and Michter’s. For 2023, you can add Lux Row (now part of MGP), Bardstown Bourbon Company (including Green River), Wilderness Trail, Jackson Purchase, and Angel’s Envy, all in Kentucky. In Tennessee, there is Tennessee Distilling Group. In Texas, Firestone and Robertson. 

Meanwhile, the majors have all gotten bigger, both by adding distilleries and expanding their current ones. Brown-Forman and Sazerac each added one. Diageo added two. Four Roses essentially cloned itself, doubling capacity, but all at one location. The other majors from the original lists, Wild Turkey (Campari) and Ross & Squibb (MGP), have gotten bigger too. 

I'm not counting demonstration distilleries, like Michter's Fort Nelson and the Evan Williams Experience, as distilleries in these counts.

That brings us to 16 companies operating 28 distilleries of varying sizes. Most of the new guys are in the contract distilling and bulk whiskey business to a greater or lesser extent and are at the lower end of the volume scale, but the combine of Bardstown Bourbon and Green River is putting up some big numbers, as are Wilderness Trail and Tennessee Distilling Group.

And we’re not finished. If we double the threshold, to one million proof gallons per year, we can probably stop here, and maybe even lose one or two. But if we keep the cut-off where it was in 2016, at 500,000 gallons, we have a few more names to add: Willett, Castle & Key, Rabbit Hole, and Sagamore Spirits all appear to be in that range. They are all about the same size and have a few years under their belts. I may be missing a couple of others.

Then there are the folks just getting started, such as Log Still in Kentucky and Nearest Green in Tennessee. Nearest has an 18-inch column still. So do Driftless Glenn and Dancing Goat (Wisconsin), Wyoming Whiskey, and Southern Distilling (North Carolina), and probably a bunch more I don’t know about. Still size tells us maximum capacity, they have to tell us how much they're actually producing.

So, yeah, the needle has moved, bigly. It's hard to keep up. And there are more coming.

The big four are still the big four, by the way, and if the newcomers have made a dent in their combined 75 percent share of overall capacity, it isn't by much. Maybe now it's more like 70 percent. 

What does it all mean? That's a question for another time.

UPDATE: (10/16/23) I just ran the numbers. The big four's share of industry production capacity, with all known current and scheduled new capacity factored in, is 65 percent.

Do Taylor Swift Fans Appreciate Having Their Own Cocktails?

 

Bad Blood Sangria, Starlight Pear Lemonade, and French 1989.

Kristen wrote: "Hi Charles K., Taylor Swift is taking the world by storm, and plenty of Swifites (sic), including the staff at Omni Boston Hotel at the Seaport, are drawing inspiration from her record-breaking Era’s tour! Below are some cocktail recipes Omni Boston Hotel at the Seaport’s rooftop restaurant Lifted, is serving from May 19-21 in honor of Taylor’s Boston shows that can also be enjoyed at home!"

This caught my eye because I like being called "Charles K." Looking further, the whole package (an email press release I received because I'm apparently on some lists) fascinated me from a pop culture perspective. I confess that while I am aware of Taylor Swift, I am not a participant, so I genuinely don't know what to make of any of this. I suspect most of you, dear readers, are in the same boat. I present it for our mutual cultural edification.

Although American whiskey, like Taylor Swift, is taking the world by storm, none of these drinks contain whiskey. 

Here are the recipes:

Bad Blood Sangria. Combine 4 oz Pinot Noir, 1 oz Blood Orange Purée, 1 oz Orange Juice, and 0.75 oz Lemon Juice. Shake and strain into a wine glass. Top with 1 oz Sprite.  

French 1989. Combine 2 oz Bombay Sapphire Gin, 1 oz Lemon Juice, and 1 oz Strawberry Rose Syrup with ice. Shake and strain into a coupe. Top with 2 oz Prosecco.  

Starlight Pear Lemonade. Combine 2 oz Malfi Lemon Gin, 1 oz Lemon Juice, 0.5 oz Lavender Syrup, and 0.75 oz Desert Pear Syrup with ice. Shake and strain into a rocks glass. Top with a splash of club soda.

Green River, the Whiskey Without Regrets, Launches Flagship Bourbons

 

A maturation warehouse at Green River Distillery in Owensboro, Kentucky.

Green River is just a name. But, oh, what a name.

As for the river itself, there is a Green River in just about every U.S. state, and elsewhere, but the one in Kentucky is the Green River John Prine sings about in his song, “Paradise.” Three-hundred-eighty-four miles long, all of it in Kentucky, the Green flows through Muhlenberg County and is still an important waterway for coal and aluminum producers in Western Kentucky.

The Green enters the Ohio between Owensboro and Henderson. In 1885, John W. McCulloch bought a small distillery on the Green called Green River. A few years later, he took the name and built a new distillery in Owensboro, along a rail line. His original slogan, “The Whiskey Without a Headache,” was banned by government regulators. He changed it to, “The Whiskey Without Regrets.” It was a huge success.

After Prohibition, the Green River Distillery became Medley Brothers. No one picked up the brand. Medley stopped distilling in 1992. Revived in 2016, it was rechristened Green River in 2020 with the McCulloch family’s involvement. About this time last year, Green River was acquired by Bardstown Bourbon Company. Both are now owned by Chicago's Pritzker Group.

We review all that history, and Green River’s recently-released flagship bourbons, in the new issue of The Bourbon Country Reader.

Other headlines in this issue: “Wyoming Whiskey Releases 10-Year Anniversary Edition Bourbon,” “Jeptha Creed, Kentucky Farmer-Distillers for the 21st Century,” “MGP/Luxco Acquires Penelope Bourbon Brand for $105M,” and we remember the late distiller, John Lunn.

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