24 Feb Single Malt Scotch Whisky Hits $1.25 Billion Export Record
Amid the looming uncertainty of Brexit’s impact on the United Kingdom, at least one industry is celebrating: Scotch whisky.
Single malt Scotch whisky clocked a record year of export sales in 2016, topping £1 billion ($1.25 billion) for the first time. This achievement is being attributed to growth in sales among luxury and prestige markets.
Export sales are vital for Scotch whisky, accounting for 93% of total production in Scotland.
In 2015, export sales totaled £914 million. (Note that these figures cover the amount of whisky shipped overseas, not total bottles sold in shops).
The growth went beyond just the single malt market as overall export sales of Scotch whisky, including blends, reached nearly £4 billion, following three consecutive years of decline from a peak of £4.27 billion in 2012 to £3.85 billion in 2015.
While the single malt market totaled 25% of overall Scotch whisky exports, it accounted for only 10% of total production.
Despite my earlier post about post-Brexit uncertainty for the whisky industry, so far the advent of Britain’s exit from the European Union has actually boosted whisky exports. A weaker pound has translated into more competitive export pricing – and higher profits – as seen in a spike of Scotch whisky shipments in the second half of 2016 following the June 23rd Brexit referendum.
So which countries have been buying?
The U.S. market – the industry’s most lucrative – has been responsible for a large proportion of the increase. Bottles amounting to £855.6 million of Scotch whisky were sold in the U.S., up 14.2% from the year before.
The French came in a far second, at £416.2 million total sales, followed by Singapore, Taiwan, and Spain respectively. (While Singapore may seem like a surprising market, it actually serves as a distribution centre for southeast Asia and China as well.
Some significant gains were also made in countries specifically targeted by the British industry. India, for example, traditionally has been a tough market for Scotch whisky due to tough trade barriers. However, Indian distilleries buy in bulk for mixing with ‘Indian-made foreign liquor.’ Exports hit £96 million, up from £85 million last year.
In Japan, Scotch whisky also saw an increase of 8.4%, hitting £82.2 million as total exports from Scotland to Japan neared £100 million.
Poland, Latvia, and Australia are also showing significant promise, each with 10%-plus increases in sales over 2015.