When Japanese whisky company Nikka announced it was discontinuing all its age statement whiskies and replacing them with just two expressions, both without an age on the label, the collective groan from the rest of the whisky industry was practically palpable.

For years the main producers of Japanese whisky – Suntory and Nikka – have been wrongly and unfairly accused of trying to copy a scotch whisky blueprint. And here was another example, said critics, and an unfortunate one, because having established a reputation for outstanding quality, Nikka was heading down the route of offering younger, inferior malt whisky at an eye-wateringly high price.

On this occasion, however, the critics couldn’t have been more wrong. Leaving aside the misguided view that Japanese whisky is little more than scotch lite, Nikka’s decision to go down the non-age statement route was for a reason far removed from the exploitation and greedy motives of at least some scotch whisky producers.

In the first place, Nikka has a history of producing high-quality whiskies without age statements and bringing them to the market at accessible price points. And a taste of the two new single malts, one from each of the company’s two distilleries, provided ample evidence that there was to be no dumbing down this time, either.

But the releases were launched with a frank and stark statement from the company itself: it was necessary to discontinue the age statement expressions, it said, because if it didn’t it would run out of stock and be forced to shut its doors.

Never has the expression ‘victim of its own success’ been more pointed or telling. Nikka’s buoyant sales had crippled it, and with Suntory’s whiskies becoming increasingly hard to find, and the price of both companies’ top-end expressions spiralling out of control, it might seem the brief golden age for Japanese whisky has come to an abrupt halt.

So is this the beginning of the end for Japanese whisky’s reign at the top of the spirits world?

TOP AWARDS

Many commentators date the recent fascination with Japanese whisky back to the start of the millennium, when Japanese whiskies picked up a couple of top awards in the west, and English whisky writers started to take notice of them. According to Tokyo-based travel and hospitality writer Nicholas Coldicott, though, 2001 was something of a false dawn.

“People talk about 2001 because it was the first time a Japanese whisky won a major international award, but for years after that there was barely a twinkle of interest,” he says.  “In 2008 you could stroll into a liquor store and find a selection of Ichiro’s Malt card series bottles for ¥10,000-15,000 each. And they weren’t selling fast. I should have bought the lot.

“So it was more a slow trickle and then a tidal wave. There were a lot of people promoting Japanese whisky before it became fashionable. Atsushi Horigami was running the Zoetrope bar, the Number One Drinks people were giving away bottles of whisky from the Karuizawa distillery, and Ichiro Akuto was releasing his card series bottles. All that helped people with an interest in whisky see the quality of the local product.”

This is a view shared by Stefan Van Eycken, editor of Japanese website Nonjatta and an eye witness to the country’s whisky boom.

“Hardly anyone in Japan was interested in Karuizawa whiskies when they were in plentiful supply,” he says. “You could even mail-order a bottle of your preferred vintage directly from the distillery, which the staff would tap from the cask, stick a label on and send to you. It wasn’t until people abroad were starting to drop sums on them previously reserved for old Macallans that whisky fans in Japan were starting to get out their wallets. The irony is that – at that point – it was already too late for whisky fans in Japan to follow suit, as the stock had been bought up by Number One Drinks and largely split between the three foreign distributors involved.

“Until five years ago, you could pick up a single cask Hakushu or Yamazaki any day of the week. A major Japanese electronics store – with branches all over the country – had a dozen or more different single casks available at any of their outlets. They had them for years and years… Now people would camp in front of the store if they knew a single cask bottling was coming out.”

Coldicott says the main driving factor was Suntory’s decision to promote the Highball – a mixture of whisky and sparkling water in a high glass and with a stylish ice ball – to a trendy, younger audience, bringing Japanese whisky back into favour in fashionable city bars.

DRAMA AND INTENSITY

When the flood came, though, it did so with a drama and intensity that has rarely been seen in the drinks industry. It started with the price of old and rare bottlings quite literally doubling overnight. And it seems to have ended with a Suntory whisky being picked as the world’s best whisky by the influential Whisky Bible, and the company’s marketing people having to buy shots of it from a London fashion bar because they didn’t have any stock to give to national newspaper writers keen to find out what the fuss was all about.

The whiskies have created the perfect storm by maxing out on the three key demand generators: people want to drink them, people want to collect them, and people want to invest in them. It means Japanese whisky has become extremely hard to get hold of in many territories, and even ‘standard’ bottles are commanding high prices.

A strong ‘secondary market’ at auction and through private sales has grown up, and the rarest whiskies from distilleries such as Karuizawa and Hanyu command prices which run into thousands of pounds and stand comparison with the  very rarest Scottish single malts.

What stock that does become available is snapped up, irrespective of price. Just this February, for instance, Suntory released 2,000 bottles of Yamazaki Sherry Cask at £200 a bottle. It barely touched the shelves.

Van Eycken says such a situation is unsustainable. “Obviously, producers will charge what the market will bear,” he says. “There are enough people now willing to part with their hard-earned cash to get their mitts on a bottle that ‘everybody wants’, but there’s a limit not to how far people are willing to go, that much is clear from auctions, but to how far they can go… given the fact that the credit card bill has to be paid at some point.

“Also, at some point, people are going to realise that there’s only so much alcohol one can drink. I know people now who have more Japanese whisky at home than their whole family would be able to drink, even if they polished off a bottle a day. I think that, yes, people are mesmerised by this thing called whisky, but reality does have a habit of sneaking up on us sooner or later… and the reality is it’s a drink, and it only acquires meaning in the process of its consumption, that is to say, its disappearance.”

Andy Simpson, founder of whisky investment broker Rare Whisky 101, agrees, and urges caution. “The demand for Japanese whisky for a while was almost like panic buying,”  he says. “We’re talking mainly about Karuizawa and for a while it was going up at ridiculous rates. There was a time in the middle of 2015 when prices may have peaked. The truth is, when you get to a certain price it becomes unsustainable and Japanese whisky may be in that category. You can’t charge people hundreds of dollars a dram. If you came to me with thousands of dollars to buy Japanese whisky I would argue that it might not be the best idea.”

So is it the beginning of the end of Japanese whisky’s brief reign at the top of the spirits world? Almost certainly not. True, the golden period of widely available high-quality aged Japanese whiskies is in the past. But that said, undoubtedly Suntory and Nikka are working flat out making new whisky spirit, the country’s whisky makers have a reputation for thoroughness and innovation, and there are some signs of new distilleries emerging, though it is notoriously difficult to set up a distilling venture in Japan.

One person who has overcome the barriers is Ichiro Akuto, founder of the Chichibu Distillery. The distillery’s whiskies are still very young, but they are widely respected for their high quality. He hopes others will follow.

“New distilleries are a good thing,” he says. “It’s great that so many people started having an interest in whisky and we hope it goes well so can all build a strong Japanese brand.

“What we are hoping for from the new distilleries is quality. Because of that, we are happy to help them. We have to ensure the Japanese brand is a quality brand. I believe the future is bright. The reputation of Japanese whisky is good now but it doesn’t mean we should stop our search for better quality. We are still working hard for the future generations – that’s how the whisky business should be.”

Most people associated with Japanese whisky agree that while the golden period has passed, a new chapter is just starting. But nobody’s quite sure what will happen next.

“I have given up trying to predict the future of Japanese whisky,” says Van Eycken. “To anyone who does I say ‘where was your crystal ball when you could drive a van to Karuizawa distillery and buy cases and cases of vintage whisky for peanuts?’”

SIGNIFICANT EXPORT

Chris Bunting, author of Drinking Japan, is optimistic about the future. “One hopelessly vague prediction I would hazard is that at the same point in the short to medium future we are going to see a quantity and quality of Japanese whisky that will finally establish it as a significant export product,” he says. “Those whiskies are being matured now by highly sophisticated companies that are capable of seeing a major commercial opportunity, and have clearly demonstrated their ability to make world-class whiskies.”

Shinji Fukuyo, master blender for Japan’s biggest whisky producer Suntory agrees, and argues that Japanese whisky has come too far not to take advantage of its world-wide reputation. “For many years we’ve worked to improve the quality of our products for Japanese consumers, and now feel that those results are being recognised around the world,” he says.

“Hibiki Japanese Harmony was released to help satisfy the global thirst for Japanese whisky, now and in the future. It was well received and its popularity continues to grow. We are determined to continue innovating in the whisky world, developing great-tasting expressions.

“I believe the increase in the number of distilleries in Japan can only be a good thing. I hope that through friendly rivalry we can produce high-quality whiskies that promote a reputation of Japanese whisky.”