Emerald Aisles

Irish whiskey is on a roll, reports Christian Davis, with increasing numbers of consumers discovering its charms worldwide

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IRISH WHISKEY HAS grown by almost 200% over the decade to 2014. This reflects an industry with ambition, a sense of mission and a deep understanding of individual markets. Irish whiskey brands now represent the fastest-growing premium spirit globally and, with investments of €1bn planned over a 10-year period, Irish whiskey and those who champion it will be well placed to generate growth, exports and jobs and a very special tourist offering celebrating an all-island heritage.”

These are the words of Simon Coveney, Ireland’s minister for agriculture, food & the marine. He goes on to say: “While unprecedented opportunities exist for growth and expansion in the Irish whiskey sector, their very scale is a challenge. A shared vision is, however, a powerful thing. It is good to see the sector encouraging and mentoring new entrants, funding global brand ambassadors and committing to sustainable growth. The sector has seen the immense opportunity that is Irish whiskey and I look forward to its contribution to the development of the 2025 Agri-Food Strategy process.” Fine words from a government minister who can see the tax receipts rolling in.

Bernard Walsh, of Walsh Whiskey, is also chairman of the Irish Whiskey Association. He says: “In the past decade, the category grew by almost 200%. In 2014, more than 6.7m 9-litre cases of Irish whiskey were exported to more than 100 countries around the world. This figure is set to exceed 12m cases by 2020 and 24m cases by 2030. Three years ago, the island of Ireland had four distilleries in operation – in the next three years that number will grow to over 15 if all the current projects move forward.

“The key to our success is to ensure that this growth is sustainable – economically and environmentally. To do this, we need a cohesive strategy, incorporating the industry, government and its agencies, to act as a ‘light hand on the tiller’ to reach our targets.”

Both look at Scotland and see the opportunity for Irish whiskey as massive. “We see the world-leading scotch industry exporting more than 90m 9-litre cases annually, with exports

of £4.3bn every year, gross value

added of £3bn to the Scottish economy,” says Walsh.

“There are more than 130 Scottish distilleries that bring investment and employment into rural areas. The UK is proud of scotch as one of its most successful exports. There is no reason that Ireland cannot achieve similar success.”

Commenting on a IWSR/Just Drinks report on Irish whiskey in April, Miriam Mooney, head of the Irish Whiskey Association, said: “Irish whiskey is reaching new consumers and new markets, with distinct and accessible products and strong brands. The existing players in the industry have driven a renaissance in the sector and Irish whiskey exports are set to double by 2020 and double again by 2030. In the past decade, the category grew by almost 200%.

“The potential is massive when we compare Ireland to Scotland, with more than 115 Scottish distilleries in operation, bringing investment and employment into rural areas. The industry will continue to work together to promote further growth.”

In June the IWSR’s 2016 US Beverage Alcohol Review, showed exports of Irish whiskey continuing to grow significantly in the US, increasing by 19% last year to surpass the 3m nine-litre-case mark.

Irish Distillers international marketing director Simon Fay tells Drinks International: “Looking at the category as a whole, all indicators are pointing to the continued growth of Irish whiskey. The arrival of new entrants will bring further competition to a budding category, but maintaining quality will be a key prerequisite to sustaining this growth. At Irish Distillers, we are committed to innovation and look forward to launching even more releases for whiskey fans to enjoy over the coming year.”

MOVEMENTS

In late 2011 Beam, now Beam Suntory, bought the Cooley distillery in Louth, controlled by the Teeling family in a deal estimated at $95m.

The brands included: Kilbeggan, Connemara, Tyrconnell and Greenore.

With their proceeds, the Teelings then bought an old brewery in Dundalk, retro fitted it as a distillery and have built a medium-sized distillery with pot stills in central Dublin.

Stephen Teeling of the Teeling Whiskey Company says: “What we are seeing is a new generation of whiskey drinkers. The 25 to 35-year-olds are not interested in what went before. The older generation are more traditional. Younger people are asking: ‘What are you doing now?’

“Scotch is for older people. We are finding younger people are coming to Irish whiskey, small-batch bourbon, Canadian and Japanese whisky,” he adds.

In September 2014, William Grant opened its €35m Tullamore distillery in County Offaly to produce 1.5m cases of Tullamore Dew. In November 2014, tequila producer Jose Cuervo took over Bushmills in a complicated deal with Diageo. In June 2015 Brown-Forman announced plans to produce whiskey at Slane Distillery. This May Pernod Ricard, owner of Irish Distillers, announced the sale of Paddy’s, the fourth largest Irish whiskey brand, to Sazerac.

In recent months, we have seen the opening of two more distilleries in Ireland: Echlinville in County Down and Walsh at Royal Oak in County Carlow. Echlinville becomes Northern Ireland’s second biggest spirits producer after Jose Cuervo’s Bushmills, with the capacity to produce approximately 15,000 bottles of whiskey, gin, vodka and poitín every week.

Walsh, with its strategic partner, Italian drinks producer Illva Saronno, will produce all three styles of Irish whiskey – pot still, grain and malt – using two distilling lines (pot still and column still). The distillery’s 650,000-case capacity (2.5m litres of pure alcohol or 8m bottles) is said to be equivalent to 10% of global Irish whiskey exports (2014). Walsh will use the additional capacity to bolster supplies to core markets (US, Russia and Europe) and target major Asian markets, including India and China from 2019, it says.

In terms of opportunities, Irish Distillers’ Fay says: “The US has clearly been a major engine of growth for the category, but markets such as South Africa, Russia and global travel retail represent significant markets for Irish Distillers. New growth markets in Canada and sub-Saharan Africa are particularly attractive, as are the mature European markets which are slowly emerging from the effects of the economic crash.”

NPD

Walsh tells DI: “The next phase for the Irish whiskey sector will see the category broaden and deepen with significant additional capacity from new and expanding distilleries (from 2018 onwards), as well as greater innovation through the areas of small-batch, terroir-based expressions and cask management programmes.

“At Walsh we have sourced a great variety of barrels and butts from both our own and our partner’s international contacts to create every taste and hue possible for whiskey drinkers to experience.

“These include bourbon barrels from Kentucky; rum barrels from Saint Lucia (Caribbean); marsala wine casks from Illva Saronno’s own Florio Marsala winery in Sicily and sherry butts from Jerez,” says Walsh.

Brendan Buckley, global innovation and prestige whiskeys director at Irish Distillers, says: “From an Irish Distillers point of view, recent trends have shown the premiumisation and diversification of the category as evidenced in the continued revival of single pot still Irish whiskey – a style unique to Ireland and which has been pioneered by Irish Distillers.

“We are also seeing a maturing of the whiskey palate with a growing appreciation of spicier styles of Irish whiskey, such as those found within the Powers range. At the same time, many of the other niche Irish whiskey producers are producing whiskeys at the higher end of the market, which is also helping to diversify and premiumise the category,” says Buckley.

Daniel Lundberg, brand director for Irish Distillers’ flagship Jameson, says: “Jameson recently restructured its entire family of Irish whiskeys, which marked the most significant move in our brand’s recent history.

“This is an exceptionally exciting development that positions Jameson at the forefront of innovation and advance within the Irish whiskey category.

“The new family, comprised of The Whiskey Makers Series, the range of heritage whiskeys and The Deconstructed Series is underpinned by the brand’s people and craft, heritage, taste and fearlessness. In short, the qualities for which Jameson is celebrated throughout the world,” extols Lundberg.