Each year at about this time, the Distilled Spirits Council of the United States (DISCUS) takes over the New York Yacht Club in Manhattan for its annual state of the industry presentation.
DISCUS is a trade association. Its members are most of the major distilled spirits companies that do business in the United States. DISCUS does those things the industry needs to do, and is allowed to do, collectively; such as lobbying and promotion, both here and in foreign markets.
The ‘news’ announced on this occasion is widely reported in the business and general media.
Here at The Chuck Cowdery Blog, we mostly care about the whiskey parts.
In the United States, Bourbon and Tennessee Whiskey (BTW) continued to be the best-selling whiskey category, outpacing other domestic whiskeys, as well as imported whiskeys by category.
BTW logged almost 17 million cases in 2012, edging out Canadian whisky at 16 million. The BTW category was up 5.2% from 2011.
Sales of the two higher-priced segments of BTW, representing bottles (750ml) that sell for more than $18 at retail, were about 54% of the total.
It’s a sign of robust good health when most of your sales come from your most profitable lines.
The highest price segment, super-premiums (>$30/bottle), was up 12.4%.
As good as the super-premium BTW segment looks, compare it to single malt scotch, up 13%; and Irish whiskey, up 22.5%.
Exports were another bright spot. The 2012 value of distilled spirits exports set a new record, at $1.5 billion, led by American whiskey (68% of export volume).
The top three export markets are the other three English-speakers; Canada, Australia, and the United Kingdom. The value of US spirits exports to Canada, our best customer, grew 212% last year.
Most of the rest goes to the EU, starting with Germany. Japan comes in sixth, Mexico comes in ninth, but grew by 358% last year.
New trade agreements account for much of the growth.
Finally, the growth of craft distilleries in the US was cited as a trend. The number of distilled spirits plants bottling fewer than 100 thousand gallons annually more than doubled between 2010 and 2012; as did their sales volume, from 700 thousand cases to 1.2 million.
That's about 1/2 of 1% of total US spirits sales.
Showing posts with label American whiskey exports. Show all posts
Showing posts with label American whiskey exports. Show all posts
Friday, February 8, 2013
Monday, June 7, 2010
Tuthilltown's Hudson Whiskey Is Not Whiskey In Europe.
Now that William Grant & Sons has decided to take Hudson Whiskeys worldwide, perhaps someone will address the elephant in the room. None of Tuthilltown Distillery's Hudson Whiskey products may be legally sold as 'whiskey' in the European Union (EU) or many other parts of the world that have modeled their own rules on Europe's.
That's because, unlike the United States, the European Union defines 'whiskey' as "a spirit drink produced by the distillation of a mash of cereals...matured for at least three years in wooden casks." The Hudson line's flagship, Hudson Baby Bourbon Whiskey, is three months old, 33 months shy of the minimum.
What is whiskey? Depending on where you sit, there is more than one correct answer. Hudson Baby Bourbon, whiskey in the United States, is not whiskey in Europe.
There was a show on Discovery Channel last night called "How Whiskey Made America." As far-fetched as their stories were, they were only fetched at all if you consider 'whiskey' and 'alcohol' synonyms.
They most emphatically are not.
After the Civil War, the growth of railroads and introduction of the column still transformed distilling from an extension of agriculture into a fully commercialized industry. Trains gave distillers a national market, which allowed them to grow big. At the same time, the new technology of the column still made it possible for the first time to produce a colorless, odorless, and tasteless distillate, which they called 'grain alcohol,' that was virtually pure ethanol.
Terminology was pretty simple then. If it was made from grain it was whiskey, just like it was rum if made from molasses and brandy if made from grapes.
People who took the newly-available grain alcohol (what we call vodka) and flavored it with tea, prune juice, tobacco, and other ingredients to make it resemble aged whiskey felt entitled to call their product whiskey too, since it was made from grain.
But the people who carefully crafted a rich, low-proof spirit and flavored it with nothing but oak felt they had the sole right to use the word. The grain alcohol flavorers, known as "rectifiers," were by far the larger block. The forces for "pure whiskey" were concentrated in Kentucky and Tennessee.
The battle between these two groups raged until 1909 and the Taft Decision, which represented a victory for the Taylors, Browns, Motlows, Samuels, Beams, Dants, Wathens, Medleys and other whiskey-making families.
The Taft Decision codified the definitions of "whiskey," "straight whiskey," and "blended whiskey" as we know them today. Since then it has been the case that although "storage in oak containers" is required, no minimum aging duration has ever been specified.
As recently as 1968 a group of producers argued for the adoption of a three- or four-year minimum, but the U.S. Treasury Department's Alcohol and Tobacco Tax Division (predecessor of today's Tax and Trade Bureau) rejected the proposal. The agency concluded that "it is preferable to permit the consumer an adequate basis for the selection of whiskies (even immature ones) than to limit his choice by banning them from the market. The mere desire to conform American regulations to those applicable in foreign countries is not sufficient justification for imposing the proposed limitation." (Industry Circular 68-03)
Therefore, on behalf of producers such as Tuthilltown, the American trade representative should argue that the United States is a major whiskey-producing country, has been for hundreds of years, and has a whiskey-making heritage that developed independently of other whiskey-making traditions. Current American rules are consistent with that tradition.
It is not in the spirit of fair trade to expect American producers to change their authentic and long-held practices in favor of European ones. Nor is it in the interest of European consumers, who want access to authentic American products, not proxies reformulated to pass muster with regulators in Brussels.
However, American producers need to be very careful about seeming to support changing the U.S. rules to eliminate the aging requirement altogether (the 'white whiskey' debate) while simultaneously arguing that the EU should recognize American rules that require aging but conspicuously do not require a minimum aging duration. It would, however, be appropriate to argue that corn whiskey should be exempt from any aging requirement.
It is absurd that while the EU recognizes "Bourbon Whiskey" as a distinctive product of the United States, it doesn't accept the American definition of Bourbon Whiskey.
An acceptable compromise would be to allow that, in the EU, any product to be labeled "whiskey/whisky" only, with no modifier, must be at least three years old, but products labeled "American Whiskey," "American Blended Whiskey," "Bourbon Whiskey," "Rye Whiskey," "Corn Whiskey," etc., would only have to meet the requirements for use of those terms in the United States.
William Grant & Sons bought a brand called "Hudson Whiskey." It's hard to see how that brand is worth very much if the word "whiskey" can't be used anywhere except the U.S.
That's because, unlike the United States, the European Union defines 'whiskey' as "a spirit drink produced by the distillation of a mash of cereals...matured for at least three years in wooden casks." The Hudson line's flagship, Hudson Baby Bourbon Whiskey, is three months old, 33 months shy of the minimum.
What is whiskey? Depending on where you sit, there is more than one correct answer. Hudson Baby Bourbon, whiskey in the United States, is not whiskey in Europe.
There was a show on Discovery Channel last night called "How Whiskey Made America." As far-fetched as their stories were, they were only fetched at all if you consider 'whiskey' and 'alcohol' synonyms.
They most emphatically are not.
After the Civil War, the growth of railroads and introduction of the column still transformed distilling from an extension of agriculture into a fully commercialized industry. Trains gave distillers a national market, which allowed them to grow big. At the same time, the new technology of the column still made it possible for the first time to produce a colorless, odorless, and tasteless distillate, which they called 'grain alcohol,' that was virtually pure ethanol.
Terminology was pretty simple then. If it was made from grain it was whiskey, just like it was rum if made from molasses and brandy if made from grapes.
People who took the newly-available grain alcohol (what we call vodka) and flavored it with tea, prune juice, tobacco, and other ingredients to make it resemble aged whiskey felt entitled to call their product whiskey too, since it was made from grain.
But the people who carefully crafted a rich, low-proof spirit and flavored it with nothing but oak felt they had the sole right to use the word. The grain alcohol flavorers, known as "rectifiers," were by far the larger block. The forces for "pure whiskey" were concentrated in Kentucky and Tennessee.
The battle between these two groups raged until 1909 and the Taft Decision, which represented a victory for the Taylors, Browns, Motlows, Samuels, Beams, Dants, Wathens, Medleys and other whiskey-making families.
The Taft Decision codified the definitions of "whiskey," "straight whiskey," and "blended whiskey" as we know them today. Since then it has been the case that although "storage in oak containers" is required, no minimum aging duration has ever been specified.
As recently as 1968 a group of producers argued for the adoption of a three- or four-year minimum, but the U.S. Treasury Department's Alcohol and Tobacco Tax Division (predecessor of today's Tax and Trade Bureau) rejected the proposal. The agency concluded that "it is preferable to permit the consumer an adequate basis for the selection of whiskies (even immature ones) than to limit his choice by banning them from the market. The mere desire to conform American regulations to those applicable in foreign countries is not sufficient justification for imposing the proposed limitation." (Industry Circular 68-03)
Therefore, on behalf of producers such as Tuthilltown, the American trade representative should argue that the United States is a major whiskey-producing country, has been for hundreds of years, and has a whiskey-making heritage that developed independently of other whiskey-making traditions. Current American rules are consistent with that tradition.
It is not in the spirit of fair trade to expect American producers to change their authentic and long-held practices in favor of European ones. Nor is it in the interest of European consumers, who want access to authentic American products, not proxies reformulated to pass muster with regulators in Brussels.
However, American producers need to be very careful about seeming to support changing the U.S. rules to eliminate the aging requirement altogether (the 'white whiskey' debate) while simultaneously arguing that the EU should recognize American rules that require aging but conspicuously do not require a minimum aging duration. It would, however, be appropriate to argue that corn whiskey should be exempt from any aging requirement.
It is absurd that while the EU recognizes "Bourbon Whiskey" as a distinctive product of the United States, it doesn't accept the American definition of Bourbon Whiskey.
An acceptable compromise would be to allow that, in the EU, any product to be labeled "whiskey/whisky" only, with no modifier, must be at least three years old, but products labeled "American Whiskey," "American Blended Whiskey," "Bourbon Whiskey," "Rye Whiskey," "Corn Whiskey," etc., would only have to meet the requirements for use of those terms in the United States.
William Grant & Sons bought a brand called "Hudson Whiskey." It's hard to see how that brand is worth very much if the word "whiskey" can't be used anywhere except the U.S.
Thursday, August 7, 2008
America's Whiskey Makers Are Cautiously Optimistic.
An Associated Press article from about a month ago just came to my attention. I wrote essentially the same story for WHISKY Magazine, but you can't access mine online like you can this one (as it appeared in the San Francisco Chronicle).
As Bruce Schreiner writes, "distillers are expanding their bourbon production and storage, and dispatching sales teams around the world, bullish for a traditionally Southern beverage gaining popularity worldwide. Surging exports, the weak U.S. dollar and rising popularity among younger Americans are driving the boom."
Virtually every producer is increasing capacity. Jim Beam, Wild Turkey, Maker's Mark, Jack Daniel's and Heaven Hill are all adding production capacity.
This expansion is literally unprecedented. The last time the industry grew like this is when it was getting back on its feet after World War II. The same sort of expansion is going on in Scotland. Whiskey is notoriously hard to forecast because of the long aging cycle, so at best people are cautiously optimistic.
As Bruce Schreiner writes, "distillers are expanding their bourbon production and storage, and dispatching sales teams around the world, bullish for a traditionally Southern beverage gaining popularity worldwide. Surging exports, the weak U.S. dollar and rising popularity among younger Americans are driving the boom."
Virtually every producer is increasing capacity. Jim Beam, Wild Turkey, Maker's Mark, Jack Daniel's and Heaven Hill are all adding production capacity.
This expansion is literally unprecedented. The last time the industry grew like this is when it was getting back on its feet after World War II. The same sort of expansion is going on in Scotland. Whiskey is notoriously hard to forecast because of the long aging cycle, so at best people are cautiously optimistic.
Wednesday, June 4, 2008
Charles and Camilla Visit Laphroaig.
Beam Global Spirits & Wine Inc. today played host to The Prince of Wales and The Duchess of Cornwall -- known as The Duke and Duchess of Rothesay while traveling in Scotland -- at its Laphroaig distillery in Islay.
They were there to sign some barrels that will be auctioned off later, with the money donated to a charity to be named later.
Blah blah blah.
What caught my eye in the press release were these tidbits:
Laphroaig is running at full capacity 24 hours a day, seven days a week.
In 2007, Laphroaig achieved record production levels of 2.5 million litres of alcohol, up 6.5% from the previous record set in 1990.
Laphroaig is committed to continuing reduction in energy usage and to hand-cutting peat, which minimizes impact on the peat bog, as well as providing island employment.
We should never forget, as we note the ongoing bourbon boom, that internationally bourbon is just a small part (about 20%) of an overall whiskey boom, which is basically a scotch boom. It is, however, a rising tide that raises all ships.
And from now on, while traveling in Kentucky I will be known as Lord Yo Yo Ha Ha.
They were there to sign some barrels that will be auctioned off later, with the money donated to a charity to be named later.
Blah blah blah.
What caught my eye in the press release were these tidbits:
Laphroaig is running at full capacity 24 hours a day, seven days a week.
In 2007, Laphroaig achieved record production levels of 2.5 million litres of alcohol, up 6.5% from the previous record set in 1990.
Laphroaig is committed to continuing reduction in energy usage and to hand-cutting peat, which minimizes impact on the peat bog, as well as providing island employment.
We should never forget, as we note the ongoing bourbon boom, that internationally bourbon is just a small part (about 20%) of an overall whiskey boom, which is basically a scotch boom. It is, however, a rising tide that raises all ships.
And from now on, while traveling in Kentucky I will be known as Lord Yo Yo Ha Ha.
Friday, January 25, 2008
Industry Council Reports Rising Spirits Sales.
The Distilled Spirits Council (DISCUS) reported today that distilled spirits grew for the eighth straight year in 2007, with sales up 5.6 percent, to $18.2 billion, and volume up 2.4 percent, to 181.5 million cases. Despite a weakening economy, the Council predicts that growth will continue through 2008. They estimate a 4.6 percent increase in sales, to $19 billion, from 185 million cases (up 1.9 percent).
They attribute this growth to continuing interest in cocktail culture and to the “premiumization” of the entire drinks category. Both wine and spirits gained market share in 2007, at the expense of beer.
Whiskey (American, Canadian, Scotch and Irish) was the largest segment, representing 29 percent of industry sales. Whiskey sales grew 3.8 percent to $5.2 billion. The vodka segment was second, at 24 percent It grew 7.65 percent, to $4.3 billion.
The report did not break-out American-made whiskey’s share of the overall whiskey segment.
However, the Council did report on 2007 exports of spirits by U.S. makers, and most of that is American whiskey. For the first time, spirits exports topped $1 billion, a 15 percent increase over 2006.
American whiskey is now sold in more than 100 different countries. The leading markets are the United Kingdom, Canada, Germany, Australia and Japan. Key emerging markets are China, Vietnam, Brazil, Chile, Romania and Bulgaria.
They attribute this growth to continuing interest in cocktail culture and to the “premiumization” of the entire drinks category. Both wine and spirits gained market share in 2007, at the expense of beer.
Whiskey (American, Canadian, Scotch and Irish) was the largest segment, representing 29 percent of industry sales. Whiskey sales grew 3.8 percent to $5.2 billion. The vodka segment was second, at 24 percent It grew 7.65 percent, to $4.3 billion.
The report did not break-out American-made whiskey’s share of the overall whiskey segment.
However, the Council did report on 2007 exports of spirits by U.S. makers, and most of that is American whiskey. For the first time, spirits exports topped $1 billion, a 15 percent increase over 2006.
American whiskey is now sold in more than 100 different countries. The leading markets are the United Kingdom, Canada, Germany, Australia and Japan. Key emerging markets are China, Vietnam, Brazil, Chile, Romania and Bulgaria.
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