The Whisky Industry in 2022: Regional Update

The Whisky Industry in 2022: Regional Update

Scotland

The outlook for Scotch exports has improved considerably over the past couple of years as suppliers adapt to post-Brexit requirements and supply chain issues as well as the removal of US tariffs. 2021 also saw the UK-Australia Free Trade Agreement which removed Australia’s 5% tariff on Scotch whisky.

“The Scotch Whisky industry seeks to trade on a level playing field around the world – and that is what the UK-Australia trade deal delivers,” commented Scotch Whisky Association International Director Ian McKendrick. “The elimination of the 5% tariff on Scotch Whisky in the Agreement will help the industry continue to expand exports to Australia, which have almost doubled over the last decade.”

Trade talks are also underway between the UK and India, with the Scotch whisky lobby keen to reduce the country’s hefty 150% import tariff on Scotch whisky. The SWA’s Chief Executive, Mark Kent, has expressed hope that a successful outcome could help increase Scotch exports to India by
£1 billion over the next five years.

Ireland

Irish whiskey has been experiencing something of a renaissance in recent years, with growth of 14% per annum since 2015 in the US market. Global Irish whiskey sales reached an all-time high in 2021 according to the Irish Whiskey Association, with a double-digit percentage rebound.

Growth has been particularly strong in India where sales rose 106% in the first 10 months of 2021 compared to all of 2020. Other growth drivers include the elimination of tariffs on Irish whisky exports to the USA as well as the lifting of tariffs in Nigeria which is currently the fastest-growing market for Irish whiskey.

USA

American consumers continue to embrace luxury whiskies, with sales of premium Bourbon, Tennessee whiskey, rye and American Single Malts increasing annually by 41% between 2015 and 2020. In the summer of 2021 a new record was set for the most expensive single barrel of Bourbon ever sold, a barrel of 10 Year Kentucky Straight from Michter’s Distillery in Louisville which fetched £166,000.

Going hand in hand with this trend are efforts to legally define the American Single Malt category. The Tobacco Tax and Trade Bureau (TTB) is expected to announce a new rule that would set out the key characteristics of whiskies labelled under this term. The criteria for this new legal definition are expected to be:

  • Made from 100% malted barley
  • Mashed, distilled and matured in the US
  • Matured in oak casks of a capacity not exceeding 700 litres
  • Distilled to no more than 80% abv [160 ̊ proof ]
  • Bottled at 40% abv [80 ̊proof ] or more

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