SWA’s annual report is out: Checking the pulse on scotch whisky exports

The annual review and the scotch whisky statistical report from Scotch Whisky Association have recently been published – and I had a wee look.

Besides the usual jibber jabber about lobbying against various taxation, promoting responsible drinking and concerns about new more strict UK health guidelines plus a slightly funny incident of a Swiss ‘Highland’ whisky, let’s go straight for the exports.

Short-term: Exports continue to decline

Apparently exports declined slightly in 2015, but the rate of decline is slowing compared to 2014.

As for the reason, David Frost the SWA Chief Executive says:

Internationally, 2015 was a tricky year. Exports continued to fall though less rapidly than in 2014. This was largely because of international political and economic developments – stronger sterling in many markets, poor governance and economic decline in others, and the fall in the oil price affecting producer countries. It was not because of any reduction in the attractiveness of Scotch Whisky and indeed the sustained growth of Single Malts shows that Scotch remains as exciting and as aspirational as ever. (Annual Review 2015-16 SWA, 2017)

Long-term trend of exports show an continous increase

Although exports have fallen a bit the last couple of years, the trend is definitely showing an increase. When you look at the export development from 1984 –well, whisky exports have been going up a lot.

Source: Scotch Whisky Statistical Report 2015, www.scotch-whisky.org.uk, 17th February 2017

On the positive side: Malt production is following the increasing exports

So when exports are increasing, do we need to be concerned about prices rising? To answer that, let’s look at the production of single malts – which luckily are increasing as well. This doesn’t stop producers from raising the prices on the scarce amount of aged single malts. Something I speculate is highly sought after by an increasing amount of e.g. extremely wealthy Asians and Russians as it has happened in the wine industry.

Source: Scotch Whisky Statistical Report 2015, www.scotch-whisky.org.uk, 17th February 2017

Three new distilleries also opened in 2015.

Export markets

  • The EU is the main region for Scotch Whisky exports accounting for 37.6% of all exports in 2015.
  • Asia is the second largest region in volume terms with 20% of all Scotch Whisky exports.
  • North American exports increased by 7.8% and accounts for 16% of the volume of total Scotch Whisky experts and more than 24% of the value.

Global exports by category, volume and value

  • Single Malt: 9% | Value: 24%
  • Bottled Blended Malt: 1% | Value: 1%
  • Bulk Blended Malt: 7% | Value: 2%
  • Bottled Blended: 69% | Value: 69%
  • Bulk Blended: 11% | Value: 3%
  • Bottled Single/Blended Grain: 0% | Value: 0%

Here, it is obvious that even though the delicious single malts only are 9% of the market, they are taking the lead on bringing in a serious amount of bucks in exports.

Blended scotch exports

  • France 12% <–– (this is a pretty insane amount. In Europe, Germany is the second largest export market but France beats them by four times as much!)
  • USA 9%
  • UK 8%
  • Asia 12%
  • C&S America 11%
  • Africa 7%
  • Middle East 5%
  • Rest 36%

Single malt exports

  • USA 19%
  • France 15%
  • UK 11%
  • Singapore 8%
  • Taiwan 7%
  • Rest of EU 23%
  • Rest of World 17%

Anyone who can share why France is such a fan of scotch, would be greatly appreciated.

Sláinte!

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