It’s all but impossible to pinpoint exactly when Japanese whisky turned from being an ugly duckling into a glorious whisky swan – but a wet and windy Wednesday afternoon at a whisky shop in Norwich, England, about a decade ago is as good a date as any.

Back then Japanese single malt was enigmatic but not much loved. No samples were available for curious customers to try, and the relatively hefty price tag ensured that the vast majority of visitors to the shop steered well clear and aged bottles were left gathering dust on many a shelf.

But on that Wednesday afternoon a man entered the shop in Norwich and asked how many bottles of Yamazaki 18 Year Old it had. He took all four, paying £75 for each of them.

That was good business for a small shop on a wet Wednesday and the staff were pleased with themselves. That’s until about an hour later, when the phone rang and a person from head office instructed them to double the price of Yamazaki 18 Year Old to £150 with immediate effect.

We’ll never know whether that incident was the result of a remarkable coincidence or whether the purchaser knew something nobody else did, but you could say that moment symbolically marked the point when Japanese began its stellar rise in popularity, with demand constantly outstripping supply, and the ever-escalating price tags unable to calm an insatiable thirst for the whiskies produced by the likes of Suntory, Nikka and Chichibu.

COLLECTORS’ ITEMS

Meanwhile rare whiskies from closed distilleries such as Karuizawa and Hanyu have come to epitomise the term ‘collectors’ items’, their prices rising rapidly in to the tens of thousands of pounds. Buoyed by a perfect storm of outstanding reviews, rock-solid investment potential, a favourable zeitgeist, a passion for all things Japanese and extreme rarity, the sector has taken on an almost mythological status.

“Interest in Japanese whisky has been so avid that a misconception has arisen that anything Japanese is top notch,” says Number One Drinks Company’s Marcin Miller. “Sadly, this isn’t always the case. And this may result in some disappointed consumers.”

Japanese whisky is dominated by two companies: Suntory, which is by far and away the biggest producer, and Nikka. In export markets they dominate the category, with small and independent distiller Chichibu occupying a special niche status in the same way as Scottish distiller Kilchoman does. There are a smattering of other distillers in Japan, but their export status has traditionally been patchy. That may be set to change, however.

The demand for pretty much anything from Nikka and Suntory has become so great that both companies have taken steps to preserve their future. Nikka in particular was facing the realistic prospect of running out of whisky and has launched two ‘non-age statement’ whiskies – whiskies with no minimum age on the label. These are presumably bottled at a younger age, to bring them to market more quickly than waiting 10 or 12 years. That has provided a partial solution to the supply issue, but Nikka warns that shortages could persist for another decade.

By nature both companies play their cards close to their chest, and are not forthcoming when it comes to providing details on whether they are increasing production and how quickly drinkers will see more bottles on the shelves.

PEAK PRICES?

In the meantime, though, surely prices are set to peak and the Japanese whisky bubble will burst? Seems not.

“Japanese whisky has now established itself as a credible force within the whisky category,” says Jane Ashley, Suntory brand manager for Maxxium UK. “In 2017, Suntory will continue to focus on the luxury end of the market, prioritising key cities internationally, such as London, Singapore and Paris. Expect to see new and exciting launches in the international regions and in global travel retail later this year.”

David Robertson, a director for Rare Whisky 101, argues that prices will stay high both at retail and in the secondary auction market.

“Japanese whiskies are able to create demand ahead of supply,” he says. “They are now, rightly, highly sought after and, led by Karuizawa and the Number One Drinks team and some of the excellent work by Suntory on Yamazaki, there has been a growing consumer appetite.

“While quality and rarity remain solid, prices have risen so much on the secondary market that they now influence all new product releases resulting in buyers (collectors and investors) seeing less immediate value. The third (and most important) buyer group – the drinker/connoisseur – will continue to weigh up what he or she can get for the same money across the whisk(e)y category – Scotch, Irish, American, Japanese and New World whiskies.”

So does that mean your chances of enjoying a Japanese whisky without taking out a mortgage are all but non-existent? Not quite. Hombo has plans for extensive export growth for whisky from its Mars Distillery and opened a second distillery in November.

The non-age statement whiskies from both Suntory and Nikka are outstanding and are becoming increasingly available.

“Suntory will see an increase in the non-age statement whiskies, particularly Yamazaki Distiller’s Reserve and Hibiki Japanese Harmony,” says Maxxium’s Ashley. “While the aged statements are more limited, there will be a small increase in allocation of Yamazaki 12 Year Old and we are prioritising stock for key on-trade accounts.”

The ability of the main suppliers to export Japanese single malt across the world is made more complex by the fact that it has become fashionable within Japan itself. For long periods domestic Japanese whisky was consumed by ‘salary men’ and was largely regarded as of indifferent quality. It was shunned by fashionable younger drinkers, who sought out the finest scotch whisky in what is largely considered the most diverse and dynamic country in the world for alcoholic drinks.

INTELLIGENT MARKETING

But a combination of countless awards worldwide and intelligent marketing by has resulted in a renewed interest in home-produced malt. And a new generation of drinkers, particularly women, have been attracted to the Mizuwari Highball serve, with Yamazaki mixed with soda water served over ice.

So much so that stock was withdrawn from some export markets to meet internal demand. It may be, then, that in the short or medium term, the place to go to drink Japanese whisky is Japan. Certainly Number One Drinks Company’s Miller would agree.

“When I first went to Japan it was unusual and exotic,” he says. “Now it is very much on everyone’s radar. Liquor store owners and duty free operators will be rubbing their hands in anticipation.”

With the Rugby World Cup coming to Japan in two years and the prospect of a Japanese-staged Olympics the year after, all Japan’s whisky producers are determined to have significant amounts of whisky available.

“Both events will be hugely important,” says Miller. “If I recall correctly, the target for tourists to Japan for 2020 was 20 million but this has been amended (in view of 19 million visitors to the country last year) to 40 million.”

Maxxium’s Ashley agrees, and adds that there is a worldwide objective too. “There is a huge opportunity to bring Japanese whisky to the global audience with these key events,” she says.

“As we saw with cachaça and the Rio Olympics, the world is drawn not only to the events themselves but to the culture of the hosting country.

“As Japanese whisky continues to make its mark on Japanese culture, people desire to invest their interest in the phenomenon. London particularly shares a great fascination with Japanese culture and 10% of restaurant openings in 2015-2016 were Japanese. This interest in Japanese food and drink is set to grow.”

So as we enter 2017, it’s as it was for Japanese whisky. The big question, though, is can it retain its reputation and popularity indefinitely when much remains out of the reach of most whisky drinkers, particularly in light of the increasing flow of New World whiskies?

Only time will tell.