I'm Not the Bad Guy Here

A few days ago, The Daily Beast published an article entitled "Your Craft Whiskey Is Probably from a Factory Distillery in Indiana," by Eric Felten.

Felten is not some general assignment reporter stumbling through his first whiskey story. He is the James Beard Award-winning author of How’s Your Drink? Cocktails, Culture, and the Art of Drinking Well. He understands this issue, as do most of the folks who read this blog regularly. I am one of the people Felten interviewed. It's a good article.

The Daily Beast is a popular general interest site so a lot of the people reading Felten's article are those who need to receive its message. Craft whiskey is a cool, new thing. There are many cool, creative people doing amazing things with whiskey and other spirits. They are bold, adventurous, talented, sometimes kookie. It's a fascinating new trend.

So, naturally, there also are a lot of slicksters out there trying to rip it off, trying to get consumers to think they are artisans when they're really just scammy marketers. They copy the trappings of craft distilling. They jabber on about craft and care and expensive ingredients and handmade this and that when all they did was buy a 500 gallon tote of aged whiskey and bottle it.

Except for true craft distillers, whose output is very small, all of the bourbon made in America is made at one of 13 distilleries owned by eight companies. For rye you can add one or two big Canadian distilleries to that list.

It's true that some of the scammers sell some pretty good whiskey. In fact, the saddest thing about this whole story may be that many of the scammers are selling a better product than the real craft distillers. How's that? Making good whiskey is hard and many of the true craft whiskeys are works in progress, bottled way too young. Others are deliberately going for unique and unfamiliar flavors. Some of it is tough to drink.

That, however, is not the point. The point is that if you want to buy a whiskey made by a craft distillery, you should be able to do so without a bunch of poseurs blocking your way. That's why I write about non-distiller producers and Potemkin distilleries, and why writers like Felten pick up on the story and report it for a general audience.

None of which explains the headline of this post. To understand that you need to scan the comments to Felten's article. You'll find things like this:

"Apparently Mr. Felton believes that only the super-rich should be allowed to start up distilleries. It takes approximately $10M to start up and fund a distillery for the 5-10 years he demands before the distillery is even allowed to sell its first bottle. Talk about snobbery."

"What does it matter if it actually tastes good and is well distilled and refined? It is a bit misleading to imply craft whiskey is 'probably' made at that distillery in Indiana."

"What does it matter? The company who is lying about their product is making a hell of a lot more money by pricing it as if they made it. A good fake Chinese Rolex looks just like a real one, why pay for a real one? However if the fake cost as much, would that be okay?"

"I think actually if the feds were less involved then small distilleries could spend more time and effort on their craft instead of paperwork and red tape. Does the gov stop your supermarket from selling store brand corn flakes made by another company?"

"When you can't sell your spirit on its own qualitative merits, talk about the big, bad things the other guys are doing. Give me a break."

Often it gets much uglier than the samples above. Very often, people who have been suckered by a Potemkin attack the messenger instead of the actual liar. Once a guy in a bar was ready to punch me because I told him that not one drop of Templeton Rye was distilled in Templeton, Iowa. He only stopped when he noticed how huge I am. Breckenridge is another Potemkin with a very loyal and belligerent following. Nobody has any contrary facts, just a lot of passion.

I've been accused of being a toady for Big Whiskey, and much worse. It's a bit nuts but once again, for everyone who has missed the point, there is nothing wrong with buying and bottling whiskey bought from a real distiller, if you tell the truth about it. If you're lying instead, or not lying but feverishly obfuscating, you better make your money fast because you won't get away with it for long.

Chris Fletcher, Asst. Master Distiller at Jack Daniel's, Is a Good Righthand Man with a Good Right Arm

As Assistant Master Distiller at Jack Daniel's, Chris Fletcher is Master Distiller Jeff Arnett's righthand man. His right arm is pretty good too, as he demonstrated Thursday at Wrigley Field in Chicago, throwing out one of the ceremonial first pitches before the Cubs-Padres game.

Tottenham Hotspur striker Harry Kane's pitch was better, but he is a professional athlete, and his whole team was watching. (They played a friendly with the Chicago Fire last night.) Fletcher's throw was at least as good as that of Pearl Jam frontman Eddie Vedder.

Fletcher's job as part of the distilling team at Jack Daniel's, involving as it does public relations appearances like the one Thursday, is very different from that of his grandfather, legendary Jack Daniel's Master Distiller Frank Bobo (1968-1988). “My first memory of the distillery is watching my grandfather make sour mash and operating the stills,” said Fletcher, who was born and raised in Lynchburg, Tennessee.

In Bobo's day, the bosses didn't like the distiller to leave town, ever. Today, public appearance demands are one of the reasons Arnett needs an assistant. That and the fact that Daniel's now sells about 15 million cases of its iconic whiskey a year.

After working as a tour guide at the distillery during college, Fletcher finished his chemistry degree and joined Daniel's parent company Brown-Forman full-time. He left there to work at other distilleries including Buffalo Trace in Frankfort, where he succeeded Truman Cox as Lead Chemist in 2011. He took the Assistant Master Distiller position at Jack Daniel's earlier this year.

With American whiskey currently experiencing such a renaissance, the 32 year-old Fletcher is an ideal fit for Jack Daniel's. He has the heritage and authenticity of Jack as his birthright, but also brings a fresh approach to product innovation. As his grandfather often reminds him, the incredible growth Jack Daniel’s has experienced since his days at the distillery is a result of the process and quality controls established by its founder. Now it’s Fletcher’s job to help ensure that the craft of making great whiskey remains true to Mr. Jack’s mantra of “Everyday we make it, we’ll make it the best we can.”

Gus Griffin, Formerly with Brown-Forman, Is New MGPI CEO

On Thursday, the Board of Directors of MGP Ingredients, Inc. (Nasdaq/MGPI) announced the appointment of beverage alcohol industry executive Gus Griffin as their new president and CEO.

MGPI is a company that makes beverage alcohol and other products from grain. Its distillery in Lawrenceburg, Indiana, which makes whiskey, has become a very important vendor to the non-distiller producer community.

Griffin also comes to MGPI after a period of heavy corporate turmoil, that culminated in the ouster of his predecessor seven months ago.

Encouraging for fans of MGP's whiskeys, Griffin is a marketing and management guy, formerly with Brown-Forman Corp., where he ultimately served as senior vice president and global managing director in charge of the company’s flagship Jack Daniel’s business.

“We are very pleased and excited to welcome Gus to our company in such an important capacity,” said MGP Board Chairman Cloud L. “Bud” Cray.

Griffin most recently spent a year as executive vice president of marketing for Next Level Spirits, a northern California-based producer, importer and distributor of premium wine and spirits brands. His responsibilities in that position included establishing strategic planning disciplines and spearheading all aspects of corporate, consumer and trade marketing. Just prior to that, between 2011 and 2013, Griffin served as brand and business consultant for Nelson’s Green Brier Distillery, Nashville, Tenn., where he performed a key advisory role in that company’s development and launch of Belle Meade Bourbon.

(Note: the whiskey in Belle Meade Bourbon is made by MGP of Indiana.)

“I am excited to join MGP and to have the opportunity to help shape the next stage of the company’s proud history,” Griffin said. “MGP has a rich heritage, a strong reputation for quality and innovation, and all areas of the business have significant growth potential.”

Griffin’s career with Brown-Forman, a leading global wine and spirits company with annual sales of approximately $4 billion, spanned 24 years. He joined that company, headquartered in Louisville, Ky., as a merchandising representative in 1987 and later moved into sales management. From 1990 to 1997, he advanced through a series of increasingly important brand management roles in Brown-Forman’s U.S. marketing organization. His brand assignments included Old Forester Bourbon, Southern Comfort Liqueur, Southern Comfort Cocktails, Jack Daniel’s Beer and Early Times Kentucky Whiskey.

In 1997, Griffin was named vice president and managing director of Brown-Forman’s Pacific Region, relocating to Sydney, Australia, to lead all aspects of this multi-million dollar operating unit. Chief among his responsibilities was driving profitable results through the oversight of marketing, sales, finance and production. He returned to the company’s headquarters in Louisville in 2001, assuming responsibility for the Jack Daniel’s brand for the Asia Pacific Region. Within a year, he was appointed to serve as vice president and managing director for West Main Interactive, a wholly-owned subsidiary of Brown-Forman in the digital and relationship marketing arena.

Griffin’s accomplishments led to his being named vice president and regional director for Brown-Forman’s Southern Europe operating unit that encompassed Spain, Portugal, France, Belgium, Italy and Greece. During his two years in this role, he led the successful turnaround of this business unit, significantly growing the region’s profitability.

With a promotion to senior vice president and global managing director for the company’s Southern Comfort brand in 2007, Griffin returned to Brown-Forman’s headquarters to lead a worldwide marketing team and ensure alignment between brand strategies and marketing practices. He transitioned to senior vice president and global managing director for the Jack Daniel’s brand franchise in 2008, leading all facets of building this brand worldwide over the following three years.

Griffin is a native of central Pennsylvania and was educated at the College of William and Mary, Williamsburg, Va., where he received a bachelor of arts degree in economics in 1982 and a master’s degree in business administration in 1987. He is a past board member of Hartmann Luggage, a former subsidiary of Brown-Forman.    

How to Become a TTB-Certified Chemist

The following information comes from the U. S. Treasury Department's Alcohol and Tobacco Tax and Trade Bureau, better known as TTB. TTB is the principal national regulator of beverage alcohol. This may be of interest if you are a producer and wish to sell your products outside the United States.
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Many foreign governments require a laboratory report of chemical analyses of exported wine, distilled spirits, and beer before the products enter their countries. Many importing countries require government laboratories of the exporting countries to perform these chemical analyses or certify that the analyses were performed.

We, at the Alcohol and Tobacco Tax and Trade Bureau (TTB) administer a program where chemists, enologists, and technicians in qualified U.S. laboratories in the private sector are certified to carry out these analyses for export purposes. TTB's Chemist Certification Program offers exporters of alcohol beverages the flexibility to perform specific analyses of their products either on-site or through a third-party TTB-certified qualified laboratory. This program ensures that chemists, enologists, and technicians are trained and can generate quality data for alcohol beverages. By using a TTB-certified chemist to do analysis, some exporters get the laboratory analysis completed more quickly thereby getting their product exported sooner.

Twice a year we share the list of certified chemists and qualified laboratories with foreign governments. We have recently updated this list.

Our Beverage Alcohol Laboratory at the TTB National Laboratory Center offers the Chemist Certification Program twice annually (spring and fall cycles). To participate in the program, applicants need to meet specific educational requirements, and must be able to analyze accurately the beverage alcohol samples (e.g., beer, distilled spirits) we send them. We will certify the applicant if a TTB chemist validates the applicant's report of analysis and the applicant meets all other requirements for certification. This certification is free of charge and is valid for two years; during this time, a TTB-certified chemist is authorized to perform specific tests and to generate reports of analysis to accompany alcohol beverage export shipments.

The Chemist Certification Program facilitates export of U.S. alcohol beverage products by allowing exporters to use a TTB-certified chemist to rapidly and efficiently perform required chemical analyses for the export market.

For more information about the program, or to view a list of TTB-certified chemists, please visit our Chemist Certification Program Information page.

Bourbon Inventory Tops 7.5 Million Barrels for First Time in 40 Years

According to a press release yesterday from the Kentucky Distillers' Association (KDA), more than 5 million barrels of bourbon are aging in Kentucky warehouses. It's the first time bourbon stocks have reached that level since 1977.

Kentucky’s bourbon distilleries filled 1.2 million barrels last year, the most since 1970. Production has skyrocketed more than 150 percent in the last 15 years, resulting in 5,294,988 aging barrels at the end of 2013. Add to that 2.2 million barrels aging at Jack Daniel's in Tennessee, for a total of 7.5 million barrels.

Other key facts from KDA:

• Bourbon isn't the only spirit aging in barrels in Kentucky. When you include brandy and other whiskies (e.g., rye, wheat), the state’s total barrel inventory was 5.9 million at the end of 2013, the highest total since 1975.

• The tax-assessed value of barrels aging in Kentucky is $1.9 billion this year, an increase of $81 million from 2013. Since 2006, the value of barrels has nearly doubled ($1 billion to $1.9 billion). 

• Kentucky distilleries paid $15.2 million in ad valorem tax last year to the state and local communities. Ad valorem tax receipts (a tax on the value of whiskey in storage) have increased 52 percent since 2006. A new law enacted earlier this year gives distilleries a corporate income tax credit against the amount of ad valorem taxes paid, if they invest that money in their Kentucky operations. (Tennessee doesn't have an ad valorem tax.)

• The KDA’s Kentucky Bourbon Trail and Kentucky Bourbon Trail Craft Tour experiences logged more than 630,000 visits in 2013, a new record for the tours that showcase KDA-member distilleries. 

Hidden in the 1970, 1975, and 1977 dates is a cautionary tale. American whiskey sales began to trend down in the late 1960s after growing steadily since Prohibition's end. Although production began to decline after 1970, it didn't decline as much as sales, so inventories kept growing until 1977. This created a whiskey glut that lasted for approximately 20 years.

That was a painful experience producers would like to avoid this time around, so don't be surprised if the current ebullience is tempered with caution. Still, it's a great time to be a bourbon fan.

There Is a Difference Between 'Craft' and 'Crafty'

As reported by Amy Hopkins in The Spirits Business last week, Diageo North America president Larry Schwartz recently declared to investors at a conference: “We’re going to be the number one craft distiller in North American whiskey in the US. Why? Because we have the whiskies.”

Schwartz was talking about the Orphan Barrels program, which so far consists of three bourbons called Old Blowhard, Barterhouse, and Rhetoric. Diageo calls them 'craft.' Others have called them "an insult to American whiskeys and the people who drink them."

The person Hopkins calls "Ewan Moran" is probably Ewan Morgan, who takes the ball from Schwartz. "Craft is about artisanship, passion, experience, great liquid, great products," he says. Okay, except 'artisan' is just a synonym for 'craft,' while 'passion' and 'experience' sound nice but they're just vague platitudes. Even absent an agreed definition, 'craft' has to be more than a vague label you can stick on just about anything.

Or does it? For marketing purposes, words such as 'craft' are best left to the consumer's imagination, because like 'small batch' and 'produced by,' the consumer is likely to believe they mean more than they really do.

Morgan is absolutely right about one thing when he says, "not all small distilleries are craft."

The American Distilling Institute (ADI) begs to differ. It defines 'craft spirits' as "the products of an independently-owned distillery with maximum annual sales of 52,000 cases, where the product is physically distilled and bottled on site."

In other words, "not you, Diageo."

But 'craft' has to mean more than just 'small,' doesn't it? ADI's problem, of course, is that so many of its members are fakes. Take a look at its pathetic joke of a craft self-certification system. Diageo probably loves it since it's based on the principle of "It's craft because I say it is."

To muddy the waters further, a California company called Craft Distillers Inc. (CD), has trademarked the term 'Craft Distillers.' Earlier this year they filed a trademark infringement lawsuit against the young movement's other trade association, the American Craft Distillers Association (ACDA). ACDA put on its tough guy face at first, then became the ACSA (American Craft Spirits Association).

Can a large distiller be craft? Probably, but Orphan Barrels isn't because there is nothing even remotely craft about the offering.

Craft is about things made, not necessarily from scratch, but where an artisan affects some kind of transformation. For something to be 'craft,' an artisan must conceive and execute an idea, and it must be a production idea, not a marketing one. The 'craft' performed must directly impact the product, not merely the packaging and promotion of it. Orphan Barrels is a marketing idea, not a product idea. The product itself consists of nothing more than several large batches of leftovers.

Too harsh? Consider the facts. No one has claimed that United Distillers, the Diageo predecessor company that made all the whiskey, intended 26 or 20 years ago to make these products, nor that it did anything special then or along the way to the specific whiskey that became these products. It was standard production of the Bernheim Distillery, from before and after it was closed and rebuilt. It is simply whiskey they couldn't find any other use for until now.

There's a name for that -- 'Closeout' maybe? 'Bargain Bin'? 'Final Liquidation'? -- but it's definitely not 'craft.' Saying the Orphan Barrels aren't craft doesn't mean they're bad whiskey. They may be great whiskey, they're just not 'craft' if 'craft' is to be anything other than a meaningless marketing term du jour.

The producers most recognized for their craft whiskeys -- Balcones, Koval, Corsair, F.E.W., Leopold Bros., Dry Fly -- do it with innovation, originality, and creativity. They do things that haven't been done before and create products unlike anything you've ever tasted before. That's what the consumer wants from 'craft,' but perhaps Lance Winters (St. George) is right when he says, "putting a binding definition on what craft is, would be like putting a binding legal definition on what art is." Consumers have to stay skeptical and always ask producers who call their products 'craft,' "where's the craft?" It's a question we've been asking here since 2008.

Curious About an Old Bottle? Try Whiskey ID

Hardly a day goes by that I don't receive an email from someone who has discovered an old bottle in an elderly relative's liquor cabinet, or some other scenario like that. Finding them inside walls while remodeling is my favorite.

They want to know how old it is, who made it, the story behind it, if any, and how much it's worth.

Now there's an app for that.

Well, not the last one (yet) but all the rest, at least the beginning of something that will do all of those things. It's called Whiskey ID. It includes tips on how to age bottles, photographs you can compare your bottle to, producer timelines, a glossary of abbreviations commonly used by whiskey enthusiasts, and other stuff.

Some of it is clearly lifted from straightbourbon.com and bourbonenthusiast.com, which is perfectly okay. That information was put up there for everybody to use and this format just makes it easier to access and thus a little more useful.

Most of all, it's easy to use. If researching your bottle on Whiskey ID is too much work for you then forget about it, because you don't really care.

It's also free.

Whiskey ID is not perfect by a long shot. It's clearly a work in progress but it's already a great resource for any American whiskey enthusiast.

Join Me for an Exclusive 3-Day Tour of Bourbon Country, October 15-17, 2014

Mid-October is a beautiful time to be in Kentucky. The heat and humidity of summer are gone, autumn’s leaves are in full flame, and Kentucky’s iconic distilleries are busy transforming fall’s grain harvest into new bourbon whiskey.

How would you like to share a few October days with me on an exclusive 3-day tour of Kentucky’s bourbon country? I promise you will love it. We’ll visit distilleries, and do a whole lot more. At the distilleries, we’ll have special behind-the-scenes access. We’ll also see bourbon barrels being made, and bourbon candy. It’s a memorable experience and a lot of fun.

We’ll leave every morning from Louisville. A terrific lunch each day is included. Where you stay and what you do in the evening is up to you, but our days will be jam-packed and I’ll be there the whole time, to share my knowledge and experience, and answer all of your questions as we explore some of my favorite places in the heartland of bourbon whiskey.

The dates are October 15-17, 2014. All of the details, including a complete itinerary, are here. The cost is $599 per person, which includes transportation, admissions, appetizers, lunches, a bourbon tasting with me, and an autographed book. For more information or to reserve your seat, call Mint Julep Tours at 502-583-1433 or email chasta@mintjuleptours.com.

We did a tour in March of this year and everyone loved it. The photograph above was taken during our visit to the grave of Dr. James C. Crow in Versailles. Everyone made new friends on the trip and got to know the real Kentucky. We were warmly received everywhere we went.

Mint Julep Tours does an outstanding job with the arrangements. They make sure we’re fed, watered, and on-schedule. Mint Julep is bourbon country’s premier tour company and I'm proud they're my partner in this endeavor.

There are only 20 spots available. It’s a little tricky, because we have to book all 20 to be able to do the tour, but people hesitate to sign up for something they know might be cancelled. That’s why we set a deadline of September 1, so you’ll know if the tour is on or not with plenty of time left to make your travel and lodging arrangements. (Mint Julep can get you deals on the lodging.)

Whether you’ve never been or can’t get enough, I promise you this will be a one-of-a-kind experience. I’m looking forward to meeting you and showing you around the Kentucky I love.

The Movement to Enforce 5.36(d) Is Growing

The Treasury Department's Alcohol Tax and Trade Bureau (TTB) puts out a series of informational brochures directed at the general public. This one, for instance, is entitled "What You Should Know About Distilled Spirits Labels."

On the back is a column of text that starts out, "How TTB Protects the Public." It says things like this: "TTB takes tremendous pride in its strategic mission to 'protect the public' which is designed to ensure the integrity of alcohol beverages in the marketplace, verify and substantiate industry member compliance with law and regulations, and to provide information to the public as a means of preventing consumer deception."

Recent examples of how TTB is failing at its mission can be read here and here. There are many others. The reality is so far from the brochure's claims, you have to laugh to keep from crying.

As citizens in a democracy, we can do something when our government fails us. We can complain to the agency in question, of course. We can also complain to our Congressional representatives. With so many fails we have to pick our fights and TTB Rule 5.36(d) is a good place to start. That was the subject of a post here two weeks ago.

One of the people who started this movement is Wade Woodard, who lives in Houston. His rep is Gene Green, who proudly represents the Texas 29th. Rep. Green responded quickly to Mr. Woodard's letter.

Although there are 5.36(d) violators all over the country, Texas is significant because there are several non-distiller producers (NDPs) there who try to create the illusion that their sourced whiskeys are made in Texas when they're not. Naturally, they don't comply with rule 5.36(d) which requires them to put "distilled in Indiana" or "distilled in Kentucky" on the label, which would destroy that illusion.

This doesn't sit well with Texans like Mr. Woodard. Rep. Green doesn't care for it either. He wrote, "As a proud Texan, I firmly oppose businesses importing goods and falsely labeling them as being made in our state." He has promised to write a letter to the Commissioner of the TTB about our allegations, and asking how they are enforcing the labeling requirements and investigating potential violations.

Good for Rep. Green. We need more like him.

To that end, here's what you need to do, all of you committed bourbon lovers out there. Do what Mr. Woodard did and write to your representative about 5.36(d). There's a sample letter here. By all means, personalize it. Tell your representative why this is important to you. Then send copies to the following.

Rep. John Yarmuth
Co-Chair Congressional Bourbon Caucus
403 Cannon House Office Building
U. S. House of Representatives
Washington, DC 20515

Rep. Brett Guthrie

Co-Chair Congressional Bourbon Caucus

308 Cannon House Office Building

U. S. House of Representatives

Washington, DC 20515

Frank Coleman

SVP Distilled Spirits Council

1250 Eye Street, NW, Suite 400

Washington, D.C. 20005

Eric Gregory

President, Kentucky Distillers’ Association

614 Shelby Street

Frankfort KY 40601

Victoria I. McDowell

Executive Director

The Presidents' Forum of the Distilled Spirits Industry

4601 N. Park Ave., Suite 1721

Chevy Chase, Maryland 20815

And Then There Was a Van Winkle Bourbon Barrel Box and It Was the Best Box Ever Made

The video above is mostly just a well-made video you can enjoy for what it is. Heritage Handcrafted does interesting things with used bourbon barrels, including this project with the Van Winkles. Pappy & Company is an outfit run by Pappy Van Winkle's great-granddaughters, who happen to be triplets. It sells everything Van Winkle except the whiskey, which is still the province of their father and brother.

The distillery shown in the video is Buffalo Trace, of course. There is no Old Rip Van Winkle Distillery. The Van Winkle whiskeys are a collaboration between the Van Winkles and Buffalo Trace.

The phenomenon that is the Great American Whiskey Revival of the Early 21st Century has spawned many sub-phenomena, of which Van Winkle mania may be both the silliest and most profound. The Van Winkle whiskeys are very good but their supposed exceptionalism is exaggerated to an extreme. Still, with retailers and illegal resellers doubling and tripling (and more) the suggested retail price of the Van Winkle whiskeys, and acting like they're doing you a favor, at least this is the family trying to feed the beast in a tasteful way.

Credit where credit is due.

The other day, on a bourbon web site, a self-identified bourbon beginner was using a smart phone app that prompted him to ask a vague question about Pappy 23, like "is it really all that great?" How to answer? Bourbon should be enjoyed and people may enjoy it however they choose, but even if you can afford a Ferrari, you probably shouldn't take your driving lessons in one. "Why not start with the best?" is the usual counterargument, but if what you've learned so far about bourbon is that Pappy is the best, then what you've learned is not useful.

It's not that something else is the best, it is that the early lesson you should have received is that 'best' is a false and destructive standard. The essence of the bourbon hobby is experience. When you buy a new video game, do you also buy a cheat book so you can rush to the end? Maybe you do. In both cases, you've only cheated yourself.

The unintentional humor in the video is how everybody throws back Pappy 23 like it's an everyday thing, and I suppose if your name is Van Winkle it can be. Mazel tov. Just like how it's on offer at every dive bar in "Justified." It's an inside joke, but a bitter one for the average bourbon drinker who would just like to try the stuff. Here, though, the human brain is very accommodating. If you move heaven and earth to get a taste of Van Winkle, expecting it to be nectar of the gods, it probably will oblige.

To that end, every Wednesday at Twisted Spoke here in Chicago is Whiskey Wednesday, and all whiskey is half-price, including Van Winkle. (Note: at the moment, the Spoke's website is being renovated, so you might want to call first.)

The On-Again, Off-Again Battle Between Tennessee and Diageo Is On-Again

Alcoholic beverages are heavily regulated at the federal and state levels. At the state level, it's each state's Alcoholic Beverage Commission (ABC). Some have slightly different names, but every state has one. ABCs have enforcement authority. They have their own investigators and inspectors. Only in serious criminal cases will the state police also become involved.

We think of the feds as regulating production and the ABCs as regulating sales, but ABCs also license and regulate production when alcoholic beverages are made within their state's borders, such as in Kentucky and Tennessee.

Tennessee, for instance, has a law that says whiskey distilled in Tennessee must be aged in Tennessee, in the same county where it was made, or a county adjacent to that county. That's the law. The reason for it may be obscure but what it requires is clear.

Then why doesn't Keith Bell, the director of Tennessee's ABC, understand it? Why does he think it makes a difference how whiskey removed from Tennessee is going to be used? Sure, if the whiskey is being removed for immediate bottling out-of-state, then there is no violation. But if the whiskey is being removed for aging in another state, such as Kentucky, as 850,000 gallons were, then that company (Diageo-George Dickel) is in violation.

After five years of Diageo sending whiskey made at George Dickel in Tennessee to Stitzel-Weller in Louisville for aging, Tennessee's ABC finally decided to cite Diageo for a violation. Diageo sued in Federal court, saying essentially that it is a dumb law because it serves no purpose.

At a hearing in that case on June 10, George Dickel Master Distiller John Lunn testified that the whiskey stored in Kentucky would be blended with other Diageo spirits, and that no George Dickel Tennessee Whisky had left the state. He further testified that in 2009, Dickel's warehouses were effectively full, so they started to ship newly-made bourbon and wheat whiskey to Louisville, in the meantime making plans to build new warehouses in Tennessee. The alternative would have been to shutter the distillery until new warehouses could be built. Sixteen-thousand barrels of whiskey (about 850,000 gallons) were sent to Kentucky.

That seemed to satisfy ABC Director Bell because when Lunn finished testifying, Assistant Attorney General Kyle Hixson announced that the state would not pursue penalties against Diageo, though he declined to say why. "Then that's it," said Senior District Judge John T. Nixon, and adjourned the hearing.

By the way, the new warehouse at Dickel is open and the removals have stopped.

As is routine, Judge Nixon ordered the parties to write up an agreement for the court to bless, but they couldn't do it. Since the violations have stopped, Tennessee wanted Diageo to pledge never to sin again. Diageo refused. A hearing was ordered for yesterday, at which the judge told the ABC to provide its interpretation of the storage statute in ten days. The ABC objected. It doesn't think the Court has the authority to order that.

The ABC keeps talking about Tennessee whiskey and making sure George Dickel Tennessee Whiskey isn't being aged in Kentucky. Diageo says nothing in Kentucky is intended to be sold as George Dickel Tennessee Whiskey, but that's not the point. Whiskey made in Tennessee is being aged in Kentucky. That's what the law says you cannot do. Diageo is doing it. If the ABC isn't going to enforce the law, it needs to explain why.

So that is where we are. Diageo has 850,000 gallons of Tennessee-made whiskey slumbering in Kentucky, Tennessee ABC Director Bell is deeply confused, and there is nothing a smart company like Diageo likes better than a confused adversary. Surely there is more amusement to come.

To Call It 'Kentucky Bourbon,' You Have to Age It in Kentucky for at Least One Year

In the 18th episode of the second season of “The West Wing,” President Bartlet and Communications Director Ziegler share a bourbon, and Bartlet says, “To be called bourbon it has to come from Kentucky, otherwise it’s called sour mash.”

Wrong on both counts, Mr. Fictional President. According to U. S. law, bourbon must be made in the United States, but every state has an equal right to make it. It just so happens that almost all of it is made in Kentucky.

Sour mash, a production method used by all major bourbon distillers, has nothing to do with it. The problem, of course, is Jack Daniel’s, which plays up ‘sour mash’ on its label and calls the bourbon it sells Tennessee whiskey for marketing reasons.

It might not be so confusing if Jack Daniel's was just another whiskey but since its non-bourbon bourbon is the best-selling bourbon in the world, everything Jack does matters.

‘Bourbon’ is a term-of-art defined in U. S. law at 27 CFR 5.22(b)(1)(i). ‘Straight bourbon’ is bourbon that has been aged for two years or more.

But what about Kentucky straight bourbon whiskey, the four-word phrase you see repeated like a magical incantation on so many bourbon labels? What does it take, legally, to put ‘Kentucky’ there?

Obviously, it means distilled and aged in Kentucky. But this raises two questions. How long does it have to remain in Kentucky to put the name on the label? And who makes sure the rule is obeyed?

The federal regulator, TTB, says only that a place of origin statement must be true. Kentucky state law, however, says that any whiskey that wants to put ‘Kentucky’ on its label must be distilled in Kentucky and aged there for “not less than one (1) full year.” (It’s KRS 244.370, and it became effective July 15, 2010).

The rule applies to all whiskey distilled in Kentucky except corn whiskey, which need not be aged at all. There is also an exception for just listing the address of the distillery as Kentucky.

Since Kentucky law only applies inside Kentucky, how they can enforce their rule?

Kentucky law can be enforced against anyone who has property or does business in the state and the penalty for violating this law is severe. Any Kentucky distillery that violates the rule can have their license revoked. The law even seems to say that if a Kentucky distillery merely sells whiskey that is less than one-year-old to someone who wrongly puts ‘Kentucky’ on the label, the distillery could face revocation. It doesn’t say for how long, it just says “the department shall revoke the permit of the licensee.” If imposed, it’s a death sentence. A bottler who is not the distiller is subject to the same penalty for merely bottling an offending product.

This is another reason why the TTB needs to go back to requiring a true age statement on all whiskeys less than four years old, instead of allowing the catch-all, “This whiskey is less than 4-years old.”

Presumably, if a whiskey is neither distilled nor aged in Kentucky, TTB will take care of that, but these days you can’t be sure. I don’t know of Kentucky’s Alcoholic Beverage Control agency (Kentucky ABC) ever coming down on anyone for this. It hasn’t been a problem but these days, with so many new bourbons and other whiskeys hitting the market, including some by producers who deliberately mislead consumers, and TTB in a coma, you can’t be too careful.

The New Bourbon Country Reader Will be in the Mail Shortly

The latest issue of The Bourbon Country Reader is at the printer now and will be mailed in a few days.

This time, it's just two long pieces. In the main one, Limestone Branch Distillery in Lebanon is the jumping-off place for a long examination of the history of the Pottingers, Dants, and a few Beams, all crucial to the earliest development of whiskey-making in southern Nelson County and western Marion County, with key appearances by the L & N Railroad and American industrialist Armand Hammer. Limestone's Steve Beam, who helped, said it was complicated and he was right, but this sorts it out pretty well.

Prohibition cost us so much of our bourbon heritage.

In the other piece, size is the subject; still size, that is. Distilleries are being built right now at a pace not seen in the United States for generations. What can still sizes tell us about where the industry is heading? We look at a few new and proposed distilleries, and some of the established ones, to see what's really going on.

This is Volume 16, Number 2 of The Bourbon Country Reader, and if you are a regular visitor to this blog, it's time to pull the trigger and get a subscription. Happily, a subscription to The Bourbon Country Reader is still just $20 per year (six issues) for addresses in the USA, $25 for everyone else. The Bourbon Country Reader is always independent and idiosyncratic and has no distillery affiliation. It is published six times a year, or thereabouts.

Click here to subscribe with PayPal or any major credit card, or for more information. Click here for a free sample issue (in PDF format). Click here to open or download the free PDF document, "The Bourbon Country Reader Issue Contents in Chronological Order." (It's like an index.)

If you prefer to pay by check, make it payable to Made and Bottled in Kentucky, and mail it to Made and Bottled in Kentucky, 3712 N. Broadway, PMB 298, Chicago, IL 60613-4198. Checks drawn on U.S. banks only, please.

A Few Clues About Early Wood Stills

(More fascinating stuff from Chris Middleton about wood stills.)

Scant records reveal there were no standard or systemic designs for wood stills throughout 19th century America, just many interpretations and adaptations in design format, construction and materials.

Since 1795 in Philadelphia when Anderson started manufacturing the first steam stills in ‘closed wooden vessels,’ efficiencies and volumes in daily production would begin to make larger, commercial distilleries and rectifiers financially feasible. It would have also taken time for the ideas, engineering skills and investment to diffuse such experimental stills from the Middle States out to the south and westward.

St Marc’s 1824 Belmont distillery London,
potato distillation 

As the earlier post explained, the cost and availability of copper was a manufacturing barrier for early still makers and distillers. So the use of wet coopered wood meant distillers could easily erect large capacity distilling vessels from cheap materials.

By 1820 we learn a distiller in Ohio, Embree, was using red cedar for his still construction made with 8 foot by 10 inch staves to hold 700 gallons of wash, based on the Richmond still design. The compartments (chambers) were separated by thick wood planks with holes drilled through to permit the steam to strip the charge as the vapours were sent from the singling still to the doubler, also made of wood.

He did admit the wood steam works ‘not as good a whiskey as copper works’. He recommended remedying this deficiency by rectification. There is evidence some wood stills had quality control issues in the early years.

1827 gin still at Nicholson distillery London

By 1834 a version of the St Marc still described as ‘tubes and caps throughout the series of chambers, and the addition of the first goose neck condenser appeared in Philadelphia. It heralds the introduction of a prototype bubble and cap valves construction connecting the column chambers.

Jean-Jacque Saintmarc was a French veterinarian who moved to London to work in developing potato distilling in the early 1820s. His early continuous still designs (copper) were also used in Belfast from 1824 to make some of the first Irish grain whiskey. Initially the spirit was regarded as ‘too pure.’ Ideas were immigrating to the east coast of America from the distillers of grape, grain (especially gin), molasses and tubers, and then acclimatized to meet the conditions of the emergent American whiskey industry

MGP Adds Wheat Whiskey to Its Portfolio

MGP of Indiana has added another whiskey to its expanding portfolio: wheat whiskey. The mash bill is 95 percent wheat, 5 percent barley malt. This parallels the company's popular 95 percent rye whiskey. The grain is non-GMO. The oldest wheat whiskey they have available for sale is one-year old.

MGP's wheat whiskey is “exceptionally smooth and possesses lightly floral and sweet taste characteristics with good barrel notes and nice balance,” according to David Dykstra, MGP's vice president of alcohol sales and marketing.

MGP is primarily a distiller of neutral spirits, including wheat vodka. “The popularity of wheat-based spirits has increased in recent years,” said Dykstra. “With rising demand in this area of the market, the addition of wheat whiskey to our product portfolio provides MGP’s customers another excellent opportunity to grow their brand presence,” he added.

MGP is well-versed in wheat science and processing technologies, as it is the largest U.S. producer of specialty wheat proteins and starches.

About ten years ago, Heaven Hill Distilleries introduced the first wheat whiskey from a major distiller in the modern era, Bernheim Original Wheat Whiskey. Its mash bill is 51 percent wheat, 39 percent corn, and 10 percent barley malt, so very different from the MGP product. Several micro-distilleries, such as Dry Fly in Washington, also make wheat whiskey.

MGP sells no brands of its own. It sell its spirits to non-distiller producers, who take the products to market.

Wheat whiskey should not be confused with wheated bourbon such as Maker's Mark. A wheated bourbon substitutes wheat for rye, and typically contains 12 to 15 percent wheat. Bourbons always contain a 'flavor grain,' usually rye but sometimes wheat, because corn has so little flavor itself. A wheat whiskey mash bill must contain at least 51 percent wheat.

MGP is based in Atchison, Kansas. Its whiskey distillery is in Lawrenceburg, Indiana.

Urge Your Congressional Representative to Push the TTB on 5.36(d)

In mid-May the following headline appeared in this space. "TTB May Crack Down on Section 5.36(d) Violations." That was, to some extent, wishful thinking. TTB was happy to accept from me a list of approximately 30 known 5.36(d) violations compiled by Wade Woodard and others, but that's about as far as it went. The rest of the story is here.

Although 5.36(d) is the focus, there have been many problems lately with TTB seemingly not doing its job. Yes, they are buried with new product applications, but that's no excuse. Part of their job is to ensure that all alcoholic beverage product labels are accurate and in compliance with all of the bureau's rules. If that job is important then they have to find a way to do it successfully, no excuses. If it's not important then abolish it and save some money. Doing a half-assed job benefits no one.

Part of the problem is that TTB is not transparent, as explained below. It might make their job a little easier if they just did a better job of letting producers know what's expected of them.

I have communicated about this with TTB often and have decided to escalate matters by writing to my congressional representative, Jan Schakowsky (D, IL 9th). I'm also sending a version to the co-chairs of the Congressional Bourbon Caucus, Democrat John Yarmuth and Republican Brett Guthrie, both of Kentucky. I am also sending a version to Frank Coleman, SVP of the Distilled Spirits Council; and Eric Gregory, President of the Kentucky Distillers' Association. I urge you to do the same. Here is my letter to Representatives Yarmuth and Guthrie. Feel free to copy it.

I am writing to you in your capacity as co-chair of the Congressional Bourbon Caucus.

As I’m sure you know, the main federal agency that regulates beverage alcohol is the Treasury Department’s Alcohol and Tobacco Tax and Trade Bureau (TTB). They do this primarily through label approvals. They have many rules about the labeling of alcoholic beverages. Right now I’m only concerned with one, 27 CFR 5.36(d), which requires that "the State of distillation shall be shown on the label of any whisky produced in the United States if the whisky is not distilled in the State given in the address on the brand label."

The address on the brand label can be anywhere the producer has a place of business, or a post office box, but if that address is in a state other than the state of distillation, then the state of distillation must be disclosed separately.

This rule is widely violated, especially by small producers who don’t distill but buy whiskey from actual distillers or intermediaries. Violations are easy to spot because all of the distilleries that sell whiskey to these producers are in Kentucky, Tennessee, or Indiana. If a producer uses an address not in one of those three states it is almost certainly in violation of rule 5.36(d).

This issue has become a ‘cause’ among hardcore bourbon enthusiasts. Thomas Hogue, TTB’s press and congressional liaison, has confirmed to me that the rule means exactly what it says. He asked for and I provided him with a list of approximately 30 companies whose product labels are in violation. I have talked to some of the companies, who claim to be unaware of the rule.

When I communicate with Mr. Hogue and others at TTB, they are always very nice and respectful. The problem is that their policy is to discuss matters like this with the affected ‘industry members’ (i.e., the producers) and not with the public (i.e., me). I don’t expect to suddenly see labels change. What I’d like is an acknowledgement that many violations of 5.36(d) have occurred and TTB is taking steps to ensure that all industry members are aware of their duty to comply with it. I would like to know that TTB is being more diligent about enforcing this rule, perhaps by issuing a pointed reminder to all American whiskey producers. Maybe TTB should direct distilleries who sell bulk whiskey to inform their customers of this requirement.

That sort of thing.

TTB essentially operates on an honor system. It doesn’t investigate label claims. It only finds out about violations if someone, usually a competing ‘industry member,’ tells them. If TTB was a bit more transparent, they might have better compliance. At least producers couldn’t claim not to know about rules such as 5.36(d).

This particular rule is important in its own right, but also because if people feel they can’t count on TTB to do its job in one area, how can we trust them to do anything right?

Part of good government is government that simply does the day-to-day things it is supposed to do capably. That’s ultimately what this is about. I hope you will look into it.

Sincerely,
Charles K. Cowdery
Author of Bourbon, Straight: the Uncut and Unfiltered Story of American Whiskey

Label Changes Can be a Good Thing

Virtually every distillery has a story about an old Master Distiller telling his young successor, "don't change a damn thing." Apparently, the industry's Master Marketers have a different philosophy. They love to change things and inevitably enrage the enthusiast community whenever they do. Enthusiasts hate change, mostly because they distrust it. Every change, they fear, heralds a degradation of the product, probably with a price increase.

Lately the target of their ire has been voluntary age statements and their disappearance. An age statement on the label tells you the age of the youngest whiskey in the bottle. Age statements for American whiskey are supposed to be mandatory for any product that contains whiskey less than four years old, but the regulators have begun to accept "this whiskey is less than 4 years old" in lieu of an actual age. If the whiskey is all more than four years old, age statements are voluntary. They just have to be truthful.

During the glut years (1980-2000), many producers put much older whiskey into their non-age-stated (NAS) products. Some also tried to get a slightly higher price by actually stating the age, so there were quite a few 8- to 12-year-old bourbons out there at very reasonable prices. This was usually done with line extensions, not the main brand, because they didn't know how long the glut would last. (Answer: much longer than anyone imagined it would.) Remember, though, during this period nothing was selling very well.

Which brings us to Eagle Rare. Eagle Rare was created by Charlie Beam for Seagram's in the early 1970s, or thereabouts. It was one of the last new bourbon brands created until Booker's and Blanton's came along in the late 1980s. Charlie finished his career at what is now Four Roses, which was owned by Seagram's at the time. He was inducted into the Kentucky Bourbon Hall of Fame in 2010, posthumously.

Charlie's Eagle Rare was a Wild Turkey knock-off, hence the bird theme and 101 proof, but 10-years-old rather than Wild Turkey's 8. (Wild Turkey lost its age statement 20 years ago.)

Sazerac acquired Eagle Rare and Benchmark from Seagram's in 1989. That was the beginning of Sazerac's bourbon program, which has since grown to more than 30 brands. Eagle Rare at the time was in a barrel-shaped bottle. It was 10-years-old and 101 proof. It was not single barrel. Sazerac left it alone for a few years but eventually gave it a classier bottle and a label printed on the glass rather than paper. They kept it at 10-years, lowered the proof to 90° and made it single barrel.

Enthusiasts are still complaining about the proof cut.

After a recent change, Eagle Rare is no longer single barrel and the age statement has been moved to the back of the bottle, which enthusiasts fear is in preparation for its elimination. For a detailed explanation of the changes and Sazerac's reasons for them, read Clay Risen's interview with Mark Brown.

Here is why this is a good thing or, at least, not such a bad thing. Eagle Rare competes in a segment led by Bulleit Bourbon, Woodford Reserve, and Knob Creek. None of them are single barrel and only Knob has an age statement (9 years). Knob has a single-barrel line extension and Bulleit has a 10-year-old line extension, but the flagships are as described.

Eagle Rare is obviously doing well against that competition because Sazerac is increasing production and putting it on a high-speed bottling line to do so. Sazerac has a lot of small brands, none of which are leaders in their market segment. A couple have a shot at achieving that. Weller is one, Buffalo Trace is another, and Eagle Rare is the third. In its segment, Eagle Rare has parity with the leaders on every characteristic except age, where it has a one-year advantage.

Eagle Rare is a very fine whiskey at a good price ($25-$30/750 ml). It's usually a few dollars below Bulleit, Woodford, and Knob. It's a good, patriotic choice for the Fourth of July. If more people discover Eagle Rare because it is more available that is good for them, good for Sazerac, and good for bourbon in general.