Whisky mak­ers warmed by Brexit boon

In pro-EU Scot­land, weak pound has gen­er­ated bump in ex­ports but long-term fu­ture is cloudy

China Daily (Canada) - - WORLD - By AGENCE FRANCEPRESSE in Glas­gow

While most of Scot­land voted against leav­ing the Euro­peanUnion, whisky mak­ers have qui­etly been rais­ing a wee­dramto a side-ef­fect of the Brexit vote — a plunge in the value of the pound.

The cur­rency de­val­u­a­tion has made ex­ports cheaper, gen­er­at­ing a bump since 90 per­cent of Scotch whisky is sold out­side Bri­tain, al­though the in­dus­try­warn­s­th­e­longer-term out­look is far more cloudy.

David Wil­liamson, com­mu­ni­ca­tions di­rec­tor for the Scotch Whisky As­so­ci­a­tion, said: “Be­cause of the rel­a­tive strength of the pound we’re cer­tainly get­ting anec­do­tal re­ports back from our mem­ber com­pa­nies that has helped to boost ex­ports.”

And Tony Ree­man-Clark, who runs the Strat­hearn Dis­tillery in Perthshire — a rel­a­tive new­comer to the mar­ket — said: “I have been talk­ing to peo­ple from big­ger dis­til­leries who said there has been a lot of in­ter­est, and a lot of sales, be­cause of the weak pound.”

Ree­man-Clark, who is also the founder of the Scot­tish Craft Dis­tillers As­so­ci­a­tion, said Strat­hearn be­gan pro­duc­ing whisky three years ago and its first 100 bot­tles were auc­tioned off on Dec 1.

The first sold for 4,150 pounds ($5,100) to an Ital­ian buyer, far ex­ceed­ing Ree­manClark’s ex­pec­ta­tions.

He said he had re­ceived bids from as far away as “Auck­land, Bei­jing, Hong Kong, Is­rael, Ger­many, Amer­ica, all over the world”.

Since theshock­Junevote the pound has tum­bled about 15 per­cent against the green­back and Gra­ham Hutcheon, the oper­a­tions di­rec­tor of dis­tiller Edring­ton, said the in­dus­try was hav­ing a “jam­boree time”.

How­ever, he urged the gov­ern­ment to pro­vide clar­ity on Brexit, Bloomberg news agency re­ported.

“We don’t know the ques­tions to ask, let alone an­swer,” said Hutcheon, whose com­pany makes whiskies such as Ma­callan and Fa­mous Grouse.

More than 10,000 peo­ple are now di­rectly em­ployed in the in­dus­try— up 6 per­cent in the past three years — while a fur­ther 30,000 peo­ple are em­ployed in its sup­ply chain from bot­tling to dis­tri­bu­tion.

The main mar­kets in the first half of this year were the United States (57.4 mil­lion), France (93.1 mil­lion) and Sin­ga­pore (9.6 mil­lion), with to­tal ex­ports equiv­a­lent to 533 mil­lion bot­tles of whisky.

More than 500 mil­lion bot­tles worth around 1.7 bil­lion pounds are ex­ported from Bri­tain ev­ery year.

The full im­pact of Brexit is not ex­pected to be re­vealed un­til dis­tillers com­plete their an­nual returns in early 2017.

Spiros Ma­lan­drakis, se­nior al­co­holic drinks an­a­lyst at Euromon­i­tor In­ter­na­tional, said: “We are go­ing to have a short-term spike, that we are al­ready prob­a­bly go­ing through and wit­ness­ing.”

But he said this would be fol­lowed by “medium to longterm un­cer­tainty that could po­ten­tially prove to be quite dam­ag­ing.

“Brexit has def­i­nitely cre­ated a cer­tain boost, pri­mar­ily from tourists vis­it­ing the UK and buy­ing from here,” he said.

An­other un­known is whether Scot­land will de­cide to go its own way by mak­ing an­other bid for in­de­pen­dence as Bri­tain leaves the EU.

“That might take away some bar­ri­ers from Europe but then it could cre­ate bar­ri­ers on the side of the UK,” he said.

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