Wednesday, September 28, 2016

Let's Demystify Label Age Statements

Everybody knows what age statements are, but many don't understand what age statements really mean. So, some facts about age statements.

For whiskey, in the U.S., an age statement is required if the whiskey is less than four years old. After four years, age statements are voluntary. In Europe, an age statement is never required but a grain distillate must be aged at least three years to be called 'whiskey.' The U.S. has no minimum age requirement. It has the age statement requirement instead.

Although age statements are voluntary, they must be true. For the statement to be true, it must give the age of the youngest whiskey in the mix. Only if a product is single barrel or bottled-in-bond will it all be the same age.

In practice, an age-stated product will mostly contain whiskey at or just over the stated age, with a little bit of older whiskey, but you never know unless the distiller tells you. That too is voluntary and typically changes over time.

As a distillery's inventory changes, along with changes in sales and product mix, the age statement once seen as a marketing advantage can handcuff the producer, preventing it from using whiskey that has the right taste because it doesn't have the minimum calendar age.

Since most age statements are voluntary, they are used only when the brand feels an age statement will help sales without hamstringing the production side. When an age statement becomes too restrictive, it is changed or, more often, dropped. This is nothing new. Wild Turkey lost its 8-year-old age statement more than 20 years ago.

Knob Creek was created 25 years ago. It was very small at first and the industry was awash with aged whiskey due to overproduction in the 70s. The Small Batch Collection of which it was part was an experiment. No one knew if there was enough demand for super-premium bourbon. They were unknown, unproven, and needed every advantage they could get. All of the Small Batch brands had age statements.

Of the four, Knob Creek was the oldest, cheapest, and most successful. Today Knob is a substantial and well-established brand. With inventories tight industry-wide due to booming sales, the Knob age statement became expendable.

The use or non-use of a voluntary age statement is always a marketing decision. When most bourbon sold was barely 4-years-old and not age-stated, a few brands decided to go with a modest statement, like Very Old Barton at 6, or Evan Williams at 7, to differentiate themselves from the NAS (non-age stated) products in the same price segment.

That was easy to do 40-50 years ago. Today it's a problem. If you have an age-stated product and more demand for it than your inventory can support, you have three choices. (1) Keep the age statement and start allocating the brand, keeping your sales and profits flat. (2) Keep the age statement and raise the price enough to raise profits despite flat sales. (3) Lose the age statement, keep the price more-or-less the same, and increase profits by producing enough (using some younger whiskey) to meet growing demand.

In the old days, brand loyalty was all. Today many bourbonistas like to drink around but brand loyalty is still very important. Producers know from experience that most loyalists have a good taste memory. They know how their regular brand tastes and you tamper with that at your peril. A price increase is the second worst thing you can do. If a price increase is modest and there are no viable alternatives, people will accept a price increase. But if the flavor changes, the people who were your best customers will abandon you in droves. Lose the age statement and, while there may be some carping, sales won't be affected.

The reassuring thing is this. Since changing the flavor is the deadliest sin, the producer will do everything it can to keep the flavor the same. That is their highest priority. Their business depends on it. So it is preposterous to suppose that the disappearance of an age statement will mean an immediate or even long term debasement of the product. The truth is exactly the opposite. The age statement was sacrificed to protect the flavor.

Businesses, more even than humans, tend to be rational animals. They act in what they perceive to be the best interest of the business. You can count on it. When that interest coincides with your interest, you have nothing to worry about.


Cranecreek said...

With due respect-the paragraphs on ages (4 years-youngest etc.) only apply to spirits that are labeled as "straight" If not labeled as "straight" there are no minimum age requirements. These are great subjects you are bringing up for education and discussion.

Chuck Cowdery said...

Not quite. 'Whiskey' and 'bourbon whiskey' must be aged but there is no minimum age. To be called 'straight' it must be at least 2. If it is less than 4 an age statement is required.

5.22(b)(1)(iii) Whiskies conforming to the standards prescribed in paragraphs (b)(1)(i) and (ii) of this section, which have been stored in the type of oak containers prescribed, for a period of 2 years or more shall be further designated as "straight."

5.40 (a) In the case of straight whisky bottled in conformity with the bottled in bond labeling
requirements and of domestic or foreign whisky, whether or not mixed or blended, all of which is 4 years old or more, statements of age and
percentage are optional.

ARBeck said...

That isn't correct. Straight whiskey must be 2 years old. Non straight whiskey can be any age. But the labelling requirements for less than 4 year old whiskey is the same for both. Some micros either are not aware of or don't care about the regulations, but they are there

Unknown said...

Chuck quotes CFR, I am impressed. And BTW Totally agree with you on age statements. Just as paint companies must "Match" Colors. Whiskey companies must 'match" taste. said...

That's a very nice riposte to the current trend of lamenting the NAS bottlings. It probably works, as you say, for established brands. The main problem are, at least for Scotch, NEW brands that pop up all the time. For these, you don't have a well-known flavor profile, and you don't know what kind of spirit you'll get there. I'm undecided - on one side, I'm sure that age does not equal quality or tastiness. On the other hand, I'm a proponent of transparency in spirits and like to know as much as possible (age of blend parts, sourcing, etc). I think dropping label information is not the best way to go for the future.

JCK said...

Nice breakdown, Chuck. It should be noted that although age statements are required by law for under 4 year whiskey, many small producers get away with ignoring that due to the lack of enforcement.

Doctor Tarr said...

You left out a fourth option: lower the proof so the same amount of whiskey fills more bottles.

This only works when the product starts at higher than 80 proof, so it's rarer these days.

Beam recently backed off when they announced it with Maker's, but Wild Turkey did it not long ago with their 86.8 and Russell's Reserve, and Jack Daniel's has done it at least once in my memory.

Mark said...

I've had a few current bourbons side by side with the old, age stated version. I can not agree with the sentiment that there is nothing to worry about. There are marked differences between the 7 year old Weller Antique and the 8 year Wild Turkey when compared with the NAS versions.

The change may take some time to be noticeable, but it will happen.

Chuck Cowdery said...

Dr. Tarr raises a good point. Obviously, Beam felt that maintaining the proof at 100° was more important to consumers than the age statement.

Greg said...

"The age statement was sacrificed to protect the flavor." This seems false; more like the age statement was sacrificed to protect availability and sales. Perhaps the flavor will stay the same but that's not what's spurring the label change.

Cranecreek said...

If any readers are still left wondering which interpretation of the labeling laws are correct, may I suggest you visit the site of the name "eCFR"-this is the electronic code of federal regulations. You want Title 27-chapter 1-subchapter A part 5. You have to jump around to different sections to get the whole story on any one spirit and the regulations for labeling them. But it is interesting and answers many questions as to labeling. it probably also creates just as many questions as to why they are written the way they are. It's not surprising that some producers have found loopholes in the laws and by no means are they necessarily smaller companies.

tms_508 said...

"many bourbonistas like to drink around" - wait, Chuck, are you implying bourbonistas are bourbon-slutty? And what'r "bourbonistas"? OMG! are you suggesting what I think you are? I'm... I'm a...I'm a bourbon-slut for not sticking to the one brand I should love and cherish always? Life's too short (to take seriously), and there are far too many pretty bottles to try!

Nice turn of words!

Erik Fish said...

"The main problem are, at least for Scotch, NEW brands that pop up all the time. For these, you don't have a well-known flavor profile, and you don't know what kind of spirit you'll get there."

It's actually instructive to look at scotch, since there the age statement issue is much more acute; much more than with bourbon, the age is part of the identity of the expression. So they've had to take a different tack, faced with the same problem: they're protecting their age-statement expressions by dumping substantially younger whisky on the market in new NAS expressions to divert demand, from Talisker Storm to Laphroig Quarter Cask to Bowmore Legend and such. I don't think as a strategy that would work here, although there may be a bit of that effect, with the NAS Knob Creek allowing the Knob Creek SB to keep the age statement.

Anonymous said...

I've got to agree with Mark above. Wild Turkey 8 year, OWA 7 year, VOB BIB 6 year, even Fighting Cock 8 and 6 year and Elijah Craig 12 year have all changed in flavor since losing the age statement. I can't think of a single bottle that lost the age statement but the taste remained constant afterwards. They may want us to believe it won't change but history seems to suggest it will

Unknown said...

Facepalm........Anonymous, All whiskeys are blended for taste. Except for single barrel. Ageing is NOT an exact science. An age statement only limits the barrels available to blend. An 8 YO statement limits blending to 8 yo or older. So if you can really tell the difference,all whiskeys taste different batch to batch. But 99.99% of the pallets in the world cannot tell the difference, You are either blessed or cursed. Take your pick.

Anonymous said...

Really Bill if you can't tell the difference between the old 8 year aged stated Wild Turkey and the WT of today I feel sorry for your palate. Same for the others

ARBeck said...

I'd be surprised if many of us would be able to tell the difference in a double blind triangle test. And if we could, it might not be because of the older whiskey. It might simply be because they've slowly changed the profile over the years to appeal to customers changing tastes.

Cranecreek said...

Have others seen TV ads proclaiming their bourbon is aged 4 long years! Or read that distilling is set to increase substantially in the coming years. Or maybe ads touting its the taste that counts with no mention of age. There is even a distillery being built around a process to more quickly age bourbon. None of these producers relish the idea of waiting 7 to 10 years before turning their inventory.
There is an entire generation of people eating and drinking products that are mere shadows of their former selves. If products are slowly changed and expectations are lowered gradually than most people over time will not notice.
I think our bourbon is at particular risk,first off demand is high and also because bourbon cannot be produced outside of the U.S. Fewer & bigger owners and increased production with high demand all point to a need for high sales now. Not that 7-10 years down the road.

Anonymous said...

To say that using younger whiskey in a batch will not affect the taste is either disingenuous or naïve. For gosh sakes, whiskey is an aged product that gets its very flavor from aging in wood casks. The age of whiskey is a key component that determines quality.

Unknown said...

Talk about naive,. Time is not the only variable on how whiskey tastes. Temperature is another variable in taste. I guess it is asking too much of some people to understand that ageing whiskey is NOT an exact science. That is why every one has people that taste and blend the product. It is a certain taste they strive to achieve. As has been said here ONLY 2 things spur mass desertion of a product. The lesser of 2 evils is increase price. The other is to change taste. Why is it so difficult to understand.
Variables, there are many in our lives, I made paint for 27+ years. NO 2 BATCHES WERE THE SAME. Every one needed a great human eye or a very expensive machine to tell the mixer what colors and how much of each needed to be added.
Smoking meats, a hobby of mine. We all know to look in a cookbook and see what temp. and how long to cook a piece of meat. Some comes out good, others no so good. The only way to to be consistently good is to use a thermometer. Know your target heat and hit it. No 2 peices of meat although the same weight are "done" in the same ammount of time. My .02

Anonymous said...

I believe in the prospect of the honey barrel(s).
For some reason, everything comes together, and that barrel(s) is just better then the others.
Maybe the shipment of grains where better, maybe the oak staves came from better trees. Who knows. And who cares.
I don't know how Beam picks the barrels for knob creek vs Jim Beam Black vs whatever.
Maybe they dedicate warehouses to each, or maybe they just take a sample out of the barrels every year. Some barrels taste like Beam Black or Knob Creek or Bakers. Again, whatever.
I expect Knob Creek to taste like Knob Creek. If adding 7-8 year old honey barrels to their 9 year old stock results in the Same Knob we would get with just 9 year old Barrels, why would I care.
The second I get a Knob Creek bottle that doesn't taste right, I will stop buying it.
I am no tasting expert, so if I can tell the difference, 90% of their customers can
Being a Knob purchaser, given the choice of, higher cost or drop the age statement, I say drop the age statement.
Beam knows their Knob customers will be trying real hard to tell the difference between the 9 y.o. and the new stuff. So I am sure their blenders are putting in the extra time to make sure the batches are just right.

Erik Fish said...

"Anonymous said...
To say that using younger whiskey in a batch will not affect the taste is either disingenuous or naïve. For gosh sakes, whiskey is an aged product that gets its very flavor from aging in wood casks. The age of whiskey is a key component that determines quality"

Actually, it's a bit simplistic to presume a linear link between age, taste, and quality, as you do. Bourbon is a beverage, no more, no less, so as long as customers cannot taste the difference, but need an age statement to tell them, the difference is more of an illusion. And as for example some of the Orphan Barrels have demonstrated, unless you're an oak junkie, age by itself is not necessarily a mark of quality. So even if the taste is ultimately affected, what matters to Beam's bottom line is whether the customers mind because they like it less. And since 9 years is toward the upper end of the bourbon "sweet spot", they've got a bit of room to maneuver.

Jim Laminack said...

The location of the warehouse (exposure to the sun - high on a hill or in a valley etc. ) and more importantly the location of the barrel in the warehouse share relevance with how long the whiskey is aged. 4 years in the rafters of warehouse A could deliver much the same results as 5 or 6 years in the lower level of warehouse B. Sometimes age is just a number to make us feel better about what we are drinking or what we are paying for what we are drinking. The important thing is that we enjoy what we are drinking and that it is a fair value. It seems to me that we Americans can get too hung up on the number. The Scotch industry is moving very quickly to NAS worldwide except in the USA. They are encountering too much resistance here. Consequently prices are skyrocketing. Check out the price of a 12 yr Macallan or Balvenie now versus 5 years ago. Personally I would hate for Bourbon prices to escalate that fast just to keep a number on the label. At the end of the day Supply and demand rule.

Tommy tom said...

Curious about "climate control" - does a warehouse that cycles twice in 24 hours simulate 4 years in 2 years?

Chuck Cowdery said...

Only a small number of distillers use climate control, and only in winter when the spirit is effectively dormant, i.e., not cycling. During winter, they gradually increase the warehouse temperature until it reaches about 85 degrees. Then they turn off the heat and let it return to ambient temperature before starting over. That cycle takes about two weeks.

Unknown said...

I am aware of the regulation in America stating that whisky must be at least four years old to exempt it from carrying an age statement
can anyone help me by letting me know when this regulation was first brought in

thanks Andy

Jim Laminack said...

I believe it was in 1964 when The Alcohol and Tobacco Tax and Trade Bureau setablished the standards of identity for bourbon governing the mash bill, distilling proof, barreling proof, bottle proof and aging standards

Unknown said...

According to CFR (Code of Federal Regulations), they do not need to do it: I don't see anything here that would confirm the statement of "For whiskey, in the U.S., an age statement is required if the whiskey is less than four years old".

DDCS said...

I'm really late answering here, but what the ... I feel the necessity to do it. Chuck is correct about the required age statements.

People who do not understand regulations should not comment on regulations.

No single section governs standards and aging.

The standard of identity for whiskey is in 27 CFR 5.22. It has it has to be aged, but there is no minimum period. To see how TTB arrived at that, look at the 1968 Treasury decision where they discuss how they arrived at the rules.

The definition of "age" is found in 5.11. It says that, for bourbon, rye, wheat and malt whiskey, age is gauged by the time spent in new charred oak barrels. Time spent in other barrels does not count.

5.40 has the statement requirements. Any whiskey aged less than four years must have an age statement. TTB has ruled that the age statement cannot be of the form, aged less than 4 years. It can be of the form, aged not less than 2 year. It can also be of the form, aged 2 months. For whiskey aged over four years an age statement is optional.

You can get around a lot of this by making a specialty product, which may not bear a statement of age - it is forbidden, see 5.23, 5.35 and 5.40 - by finishing bourbon, for example, in a port barrel, then using inventive line breaks on your label. Angel's envy is such a product.

I'm not putting Angel's Envy down. It is what it says it is. The label is transparent. As a consumer, I know what I have when I buy it. But until I taste it, as with all products, regardless of age, I don't know what it tastes like until I taste it. And, if you have my sort of unsophisticated taster, your likely to be able to say only "yum," "yuck" or "shrug."

Anonymous said...

When the producers decide to drop the Age St-t, why instead wouldn't they just REDUCE/LOWER BUT KEEP it, and thus still provide their consumers (us) a minimum assurance of the 'remaining quality' above the 4-year 'straight bourbon'? For example, the EC12YO would become EC8YO age-stated, Knob Creek 9YO would become say KC7YO, Fighting Cock 6YO would turn into 5YO, Jim Beam Black 8YO would become say 6YO, etc. etc. Your thoughts ?

Chuck Cowdery said...

All that matters is sales and the gamble with age statements seems to be paying off. In other words, no harm no foul. That's not seeing it from the consumer's perspective but companies mostly just pay lip service to that. From a profitability standpoint, dropping the age statements is the way to go.