21 Feb Single malt Scotch whisky exports top £1bn for first time

Single malt Scotch whisky topped £1bn worth of exports for the first time in 2016.

The milestone reflects a return to growth for exports of Scotch more widely, with nearly £4bn of overseas sales in total.

Exports account for around 93% of production.

That follows a dip in 2014 and 2015, when a rapid increase in previous growth was checked by disrupted overseas markets.

Chinese officialdom cracked down on lavish hospitality, while key growth markets in Venezuela and Brazil hit serious economic difficulties.

British exports of gin, meanwhile, rose by 13% last year, as it enjoyed a boom in variety and interest, rising to £474m worth.

The return to growth for Scotch whisky has been driven by the success of single malts appealing to luxury and prestige markets.

New features

These have to be made at one distillery, from malted barley, and matured for at least three years in traditional casks.

They are led by brands including Glenfiddich, Glenlivet, the Macallan, Jura, Laphroaig, Talisker and Highland Park.

Figures issued this month by HM Revenue and Customs trade shows the amount of pure spirit exported as single malt in 2016 was equivalent to 113m standard bottles at 40% strength.

That did not rise as fast from 2015 as the value placed on single malts, as distillers find new expressions and add new features with which to add super-premium value.

These include longer maturation, stronger, cask-strength versions, and different types of cask flavouring.

The total value of single malt exports reached £1.02bn, up from £914m in 2015.

It now represents nearly 10% of the volume of Scotch exported, and more than 25% of its value.

whisky bottles Image copyright SWA

The total value of Scotch whisky exported from the UK last year reached £3.999bn. That was a rise from £3.845bn in 2015. The previous three years were above £4bn, peaking in 2012 at £4.283bn.

The USA remained the biggest market for the value of sales, rising from £749m to £854m.

France remained the biggest importer of Scotch by volume, with 189m bottles. The value of sales in France was £424m, of which single malts made up £153m.

High trade barriers

Other major markets for Scotch include India. It has high trade barriers to bottled Scotch, but the country’s distillers import large quantities in bulk, for mixing with “Indian-made foreign liquor”.

The value of exports to India was up from £85m in 2015 to £96m last year.

Singapore is a distribution centre for south-east Asia and one indicator of the strength of the Chinese market for Scotch. Sales there were £224m, up from £210m in 2015 and £200m the previous year.

Single malt sales have been an important part of the success of whisky in China. Although the value of the premium brands fell from £52m to £46m, the volume sold went up to 9.6m bottles.

Further analysis of the figures by Leon Kuebler, head of research at WhiskyInvestDirect, an online marketplace, showed the impact of the weaker pound helped the value of sales accelerate.

In the first half of 2016, the value of exports was down 1% while volumes increased. But after the European referendum and the slump in the value of sterling, the value of sales rose nearly 7%, and faster than volume increases.

That research also noted the rise in exports to Spain, which was a big consumer of Scotch until the financial crash. The value has returned to its highest level since 2007.

Source: http://www.bbc.com/news/uk-scotland-scotland-business-39022740



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