Irish Grain Whiskey is generally great quality and delicious. Why then is such a fantastic spirit managing to slip underneath the radar? Certainly Irish whiskey is undergoing a renaissance right now. Very soon the number of distilleries will rise from 13 to 35. In 1987, there were only four when the Cooley distillery opened its doors for the first time. The interest in Irish Pot Still and Blended whiskey is reaching stratospheric proportions. Quite rightly winning plaudits left right and centre. Partly thanks to our American cousins, who cant drink enough of the Irish liquid gold. There is a real shortage in aged stock. This is being reflected in rapidly rising prices.
For Grain whiskey, yes some brands have come on to the market. If you look around you’ll find a very small handful of expressions from Teeling, Kilbeggan & Midleton. However all the whiskey is quite young and clearly only small quantities have been released. Cooley for example did release a 15yr & 18yr under their Greenore brand. (And it actually won a lot of awards). Although it was soon discontinued as only 5,000 and 4,000 bottles were available. Why is so little of this whiskey available? Is it any good? As an investor why should I get excited about this? Well we’re going to laydown why Irish Grain Whiskey could be a very savvy investment and addition to any portfolio.
Irish Grain Whiskey is of course a very important component of any Irish Blended Whiskey. Until recently most of it was made by the Midleton distillery down in Cork for their very successful Jameson brand. Very little grain whiskey was aged anything more than a few years. Recently the demand for Jameson and other Irish blends has skyrocketed. Jameson alone has gone from 500,000 cases to 7.5m in just 25 years! What has also caught Irish distillers by surprise is the increasing demand for blended whiskey. They are desperately short of both older Malt & Grain casks. With all these shortages it means that very little Grain Whiskey has ever been released.
Is there even a market for Irish Grain Whiskey? The simple answer is absolutely, especially if you have older aged casks. At the moment you can only find younger expressions on the market. This is because most of the older casks are being tipped into blends. Recently we acquired some Cooley 2009 & 2010 Grain Whiskey casks and these are a great investment. Right now it tastes amazing so imagine how its is going to be in 10 years! These casks are certainly undervalued because there is very little older Irish grain whiskey lying in warehouses anywhere. Secondly it was distilled by Cooley. Their award winning Greenore 15yr & 18yr expressions prove how fantastic the whiskey is. Thirdly the age of the whiskey is 11 & 12 years old respectively. It is already at those magic numbers which are very appealing to consumers and thus Independent Bottlers.
This investment could be kept for a short while until it was 15 years old. Or, wait until it was either 18 or 21 years. This is when the value should’ve accelerated upwards even further. Our suggestion for your exit strategy is to put these casks up for auction with our ‘Auction Your Cask’ facility (with a reserve of-course). And see where the value goes. You could be very very pleasantly surprised.
Today the global marketplace is dominated by Scotch Whisky. Powerhouse blends like Johnnie Walker, Chivas Regal & Ballantine’s can be found widely distributed in every country in the world. Even where it is highly illegal to drink alcohol! Single Malt whisky sales are in a steep trajectory upwards which is sure to continue when the pandemic is over. However, it wasn’t always this way. In this article, I’m going to explore the past and present to help give you investors a clear vision of the future and what my advice would be moving forward.
EARLY TURBULENT BEGINNINGS LEADING TO THE FIRST GOLDEN AGE
Where to start? Well both the Scots & Irish lay claim to be the first to distil whisk(e)y. There is actually evidence on both sides. Ergo, this Englishman is not going to get involved in that particular war of words. I’ll leave the Celtic cousins to it. However, it is very clear that by the 1500s both countries were involved in widespread illegal home distilling. The fiery liquid being produced was being drunk neat and unaged. Over in Ireland which was under British rule new laws were passed. This made it illegal to distil any spirit without a license.
Most Irish laughed at this because beyond the large ditch (known as The Pale) which surrounds the land around Dublin these laws were ignored. This is where the famous saying ‘beyond the pale’ comes from! The British though continued to pass their laws as they gained more firm control over the country.
In 1661 the first heavy taxation was imposed on Irish whiskey. However, despite this production continued to expand, most of which was illegal. It wasn’t until the late 1700s that things really started to move in a positive direction in terms of quality. The invention of the steam engine and the industrial revolution really transformed the industry. But just when the future was looking bright, heavy taxation stopped it in its tracks and drove production underground again.
However, in 1823 in both Scotland & Ireland, the tax laws were changed for the better. Fed up with the huge amounts of tax-free illegal distilling occurring, and the cost of having an army of excise men to track them down, one of our most enlightened Chancellors of the Exchequer (it’s a very short list!) transformed the distilling industry for the better. Step forward Sir Robert Peel who did something truly remarkable… He massively lowered the tax on distilling to encourage the industry to go legal and to ultimately raise a lot more revenue! (Try explaining that to any politician today and they won’t understand)! This is exactly what happened as in just 12 years legal distilleries in Ireland went from 32 to 93.
Although again just when it looked like it was coming up Irish, there were huge problems with the potato famine. Additionally, there was a lot of fraud, counterfeit whiskey, and a severe lack of regulation hurting progress. Another surprising twist in the fortunes of Irish Whiskey occurred in the late 1870/80s. The phylloxera epidemic wiped out the French vineyards. Consequently, the dominant spirit of French Brandy was almost impossible to find, but the people had to drink something. Irish whiskey stepped forward and in a short space of time production quadrupled.
This was a true golden era for Irish whiskey as it totally dominated the global market. It was also helped by the invention of the railways and the huge expansion of the British Empire. Plus, fuelled by the quickly expanding US market. Luck was well and truly smiling on the Irish and the number of distilleries ballooned to over 200! Although it couldn’t last…
By 1914 it was all starting to unravel. World War 1 had just started and grain was being diverted for food production. This happened just as the German submarines had surrounded the British Isles. Then in 1916, the Irish started their war of independence which whilst ultimately successful, meant that Irish whiskey was effectively cut off from the very profitable British Empire market. If that wasn’t enough our American cousins introduced prohibition in 1919 (what were they thinking?!). The canny Scots immediately started to facilitate a huge smuggling operation through the British colonies of Canada. This also included the Bahamas, in order for the whisky to reach American consumers.
The Irish were blocked from this route. To make matters even worse, the illegal bathtub distillers started to make fake rotgut whiskey. They called it Irish for the simple reason that Irish whiskey used to sell for a higher price than Scotch. This though absolutely ruined the reputation of Irish whiskey whilst Scotch whiskey was being enhanced. It got worse…
In the Irish home market, the abstinence movement was gaining great traction through the Church. Many Irish were encouraged to ‘take the pledge’ and give up alcohol. Therefore in a few short years, Irish whiskey lost the US market, the British Empire market, and their own domestic market. The number of distilleries quickly went from 200 down to three! Things remained bleak for many years. Even when prohibition was finally over in 1933 the world then fell into a huge global depression. This was then followed by World War II. It wasn’t until 1966 when the first seeds of recovery started to occur.
In 1966 the three surviving distilleries (Jameson, Powers, Cork) in the South decided to pool resources and form the company Irish Distillers Ltd. A few years later they were joined by the only distillery in the North (Bushmills). However, the new company wasn’t that successful. They were eventually taken over by the French group Pernod Ricard with Bushmills going to British company Diageo in 2005. The huge global reach and marketing resources of these two companies then started the recovery. The main driving force has been the Jameson brand. By the mid-1990s sales globally had reached a very impressive 500,000 cases.
Today this has risen to 7.5 million! The interest in Irish whiskey has just exploded and with that more and more premium, older expressions have been released. The Irish Pot Still whiskies are now seen in terms of quality as the equivalent of Scottish Single Malt. The success of Redbreast, Midleton, The Spot Whiskies, Powers John’s Lane, Bushmills, Tullamore Dew, Teeling, Writer’s Tears, Connemara, West Cork… the list goes on.
For investors, this is a very exciting time to look at getting into Irish Whiskey. These are the reasons why the future looks very bright….
History/Heritage – Irish Whiskey has an abundance of this (as you’ve just read) which today’s consumers hold great importance to. It’s also a marketeers’ dream to have something genuine to promote.
Quality – All the raw ingredients, distilling knowledge, and climatic conditions which make Scotch Whisky so special are also equally present in Ireland. The whiskey the Irish are making is very, very good.
Investment – Huge telephone numbers of investment are going into building new distilleries, upgrading facilities and the promotion of various brands. This doesn’t happen if all these very successful companies are not confident of future opportunities. Currently, there are four large established distilleries, nine new ones up and running with a further 22 being built.
Shortages – Demand is outstripping supply with aged whisky. Independent bottlings are still relatively thin on the ground so with 1500 Independent Bottling companies desperate for good quality Irish whiskey there will always be an exit strategy for any investor.
The US Advantage – The Americans love Scotch Whisky but they are almost obsessed with Irish Whiskey. Starved of supply and quality for close to 100 years our American friends cannot buy enough Irish Whiskey it seems. This is certainly fuelled by the huge Irish American population and the US is by far the most important spirits market in the world.
Global Trends – Irish Whiskey is very strong in the US and a few other markets but there is so much untapped potential around the world especially in Asia and South America. There is no reason why Irish whiskey can’t carve out its own chunk of every market where Scotch whisky does well.
Of course, everything comes down to price and value. Therefore look for a distillery that is already proven to make great quality whiskey, has established successful brands, but still has good value for investors – this would be the safe investment play here. One distillery springs to mind… Cooley (of which we have on our current stock list in the forms of Single Malt and Single Grain!).
For more info on the Irish Whiskey we have in stock and other casks on our stock list, click here (you must be registered on our website and logged into your account to view it).
The Irish weren’t very lucky when it came to whiskey in the early part of the 20th century. From having a dominant position over their Scottish cousins it all quickly unraveled thanks to US Prohibition. They gained independence but were then hit with huge tariffs for the British Empire market; the surprisingly very strong temperance movement in their own domestic market. In a short space of time, Ireland went from around 200 distilleries down to three. Finally, the comeback is well and truly on and Cooley Irish Whiskey can be proud of the part they played in this.
In 1985 John Teeling bought a state-owned potato schnapps (a joke here would just be too easy). He converted it into Ireland’s first new whiskey distillery in over 100 years. Early on they decided to innovate and break from the standard way of doing things. The release of a peated malt was actually quite controversial at the time as that was considered Scottish territory. However, Teeling said why shouldn’t we challenge the Scots on their own turf as clearly, peated whisky was very popular.
The distillery itself is located just south of the border in County Louth. They actually in effect have two distilleries in one as they also produce grain whiskey for their blends. Current production is up to around 650,000 litres for their Malt with two pot stills operating. Most of the aging’s done in first-fill bourbon casks but they do use sherry, port, and Madeira cask finishes. Some of Cooley’s current products are gaining in sales and very positive reviews. These include their Kilbeggan Blend, their Connemara Peated Malt, and of course the Tyrconnell Single Malt.
Recently they were bought by the Japanese company Suntory, which has seemingly only helped them go from strength to strength.
From an investor point of view, it is clear that Irish Whiskey is on a strong upward trajectory, and evidence of this is recent global sales and the number of new distilleries opening/being built. This is a very good time to add Cooley Irish Whiskey to your portfolio; with Cooley, you have a producer with an already very strong track record, with a loyal growing following (especially in the all-important US market) and who make great whiskey. We have Irish Whiskey on our current stock list so get in touch and let’s talk Whiskey!
Mackmyra is a relatively new distillery, having started distilling in 2002. The inspiration for the distillery started when a group of friends on a ski trip had brought with them a bottle of whisky for their host. The conversation then started about creating a high-quality Swedish whisky. Three years later their dream had become a reality and in 2006 they released their first expression. (It sold out quicker than Rolling Stones tickets!).
In 2011 Mackmyra opened up their ground-breakingly innovative Gravity Distillery. The seven-story building starts with the local malted Swedish barley going in on the top floor. Every floor down is another step in the process, with distillation occurring on the second floor. The new-make spirit then comes out on the ground floor. The distillery uses all the latest energy-efficient devices which makes Mackmyra one of the ‘greenest’ whiskies in the world.
Much of Mackmyra is aged in local Swedish oak. This is very different from your traditional American white oak as the trees grow much slower in the much colder climate. This imparts a spicier, fiery quality to the whisky, which is balanced by a vanilla sugar sweetness that is also prevalent. Mackmyra does also use American and Sherry casks in its aging, and these are also worth looking out for. Another innovative project that Mackmyra have started is finishing their whiskies in a whole range of casks. These include ones that have previously contained lingonberry wine, cloudberry wine, roasted coffee beans, cherry wine, beer & rum. Exciting times ahead.
For the future, we do believe that the reputation of Mackmyra is going to continue to grow. In the cool climate of Sweden, their whisky is only going to continue to improve with age and become highly collectible. If you have a couple of spare kronor, then you know what to do.
Paul John’s Single malt distillery is located in Goa and they make their whisky the Scottish way using a double distillation of malted barley. The wash comes in though at quite a low 5% ABV (rather than the usual 8%) and this gives a much sweeter taste. After distillation, the new-make spirit will go into the cask at 55% and after four/five years of aging in the tropical heat, the final product comes in at around 57% for their Single Casks. It’s worth pointing out that the tropical monsoon climate of Goa ages the whisky very fast as compared to Scotland and just four or five years in that climate could be argued to be the equivalent of 12-15yrs in the Highlands.
The Indian-made copper pot stills produce about two million litres of spirit per year and maturation actually takes place in underground cellars, which whilst cooler than the outside temperature, the angels share is very high, as temperatures regularly hit 35c+. Paul John uses a mixture of Bourbon & Sherry casks and interestingly makes some smoky batches using peat imported from Scotland.
Whisky aficionados in the know are getting more and more excited about this wonderful distillery. Recently Paul John was awarded one of the Top Three whiskies in the world in the 2020 World Whisky Awards and has a whole slew of gold medals from every award show imaginable. Make a note, Paul John is quickly rising in the whisky ranks.