Archive for the ‘Whisky News’ Category

Latest DISCUS Numbers Confirm Whiskey Growth Still Strong

Friday, February 6th, 2015

Author - Liza Weisstuch

Partisanship nearly defines America today. But on Tuesday morning, the Distilled Spirits Council of the US offered some information that all parties can applaud: the American whiskey can claim a banner year. Again. The total whiskey category was flat for years, then in 2011 it picked up steam and it hasn’t shown signs of flagging.

This year’s industry review, which the trade organization presents each February, revealed that the total supplier sales in the US were worth $23.1 billion. With American whiskey, it’s the same happy story: the category is booming and it’s the high-end and super premium brands that are driving the growth. Supplier sales of bourbon and Tennessee whiskey across price segments grew 7.4% over 2013 to approximately 19.4 million cases, a jump of 1.3 million cases. That increase accounts for a massive chunk of the 4.4 million cases by which the overall industry grew in 2014.

The revenue growth for American whiskey tells its own story. Last year, supplier sales rose 9.6% to $2.7 billion, up $230 million over 2013. Breaking it down by price segment proves DISCUS’s oft-repeated dogma: premiumization, which is shorthand for “people aren’t drinking more, they’re drinking better,” drives the industry. Revenue on value products ($12 or less at retail) grew a mere 5.5%, about $181 million on 3.1 million cases. Revenue on high-end ($18-$30 per bottle) products, were up 8.1% to $1.6 billion (yes, billion). But the truly jaw-dropping growth quotient comes in the realm of the super-premium brands ($30+/bottle). These sales leaped 19.2% to $325 million.
Combined whiskey sales growth is accelerating (numbers include imported and flavored whiskeys; CAGR = Compound Annual Growth Rate)

Whiskey category growth accelerates (totals include flavored and imported whiskeys; CAGR = Compound Annual Growth Rate)

Whiskey category growth accelerates (totals include flavored and imported whiskeys; CAGR = Compound Annual Growth Rate)

Flavored whiskey was a factor in the surge. Sales of an increasing selection of flavored American whiskey products grew by 140,000 cases. But a more significant is the thriving export market. Christine LoCascio, DISCUS senior vice president for international trade, apologized for being repetitive year after year as she reported more record-shattering stats: the $1.12 billion revenue that bourbon and Tennessee whiskey bring home to producers accounts for 70% of the $1.56 billion spirit exports market.

The top export markets are Canada—which, with $212.6 million of sales, marked a colossal growth of 111% over the past ten years—and the UK ($177.6 million). Germany and Australia pretty much tie with their spending of $136.7 million and $131.2 million, respectively. Then there’s the bureaucratic activity (or mumbo-jumbo, depending on your appetite for granular examination of international relations.) Trade agreements in recent years have reduced or eliminated tariffs in countries like Korea and Australia, which open up more export opportunities.

All this American whiskey talk, however, didn’t drown out the news about Scotch.

“When you listen to single malt Scotch drinkers talk, it’s almost like they’re having a religious experience,” said David Ozgo, DISCUS chief economist. He proceeded to explain that, as with bourbon, high-end and super premium brands are propelling the whole category. While revenues from “premium” single malts (the least expensive brands), fell by 13.4%, high-end and super premium rose by 6.8% and 6.3%. respectively. This came as little surprise just days after the Scotch Whisky Association announced that the Scotch industry is worth more than £5 billion in the UK, which outpaces two of the UK’s giant industries: computers, and iron and steel.

A small but increasing role is played by America’s boutique brands. In 2010, there were 109 independent distilleries operating; today there are more than 700. With sales of about 3.5 million cases last year, these producers account for 1.7% share of the spirits market’s volume. Ozgo noted that estimated supplier revenues was between $400 and $450 million, a sum he calculated based on data from the Alcohol and Tobacco Tax and Trade Bureau, which indicates taxes paid.

The information presented at the briefing skirted the ongoing debate around the increasingly contentious terms “craft” and “handcrafted,” which have generated class action lawsuits against false claims. DISCUS uses the term “small distillers,” which it defines as the 712 producers turning out less than 50,000 cases (the average in that group being an astonishingly small 3,000 cases). The data, however, also takes into account seventeen distilleries that produce an average of 80,000 cases.

When, after the presentation, this reporter asked about the “handcrafted” debate, Frank Coleman, DISCUS senior vice president of public affairs, noted, “Let them fight about it. Some of the finest craft products in the world are made by large companies. [Glenmorangie master distiller] Bill Lumsden is making handcrafted whisky.” It is a distinction almost unique to whisky that makes the category even more intriguing.

 

Beam Releasing New Bonded Bourbon

Friday, January 16th, 2015

Author - Lew BrysonWe just learned that Beam Suntory is releasing a new bourbon — another one! — and while it’s very affordable at $24 the bottle, it’s also pretty special. Jim Beam Bonded is the first new bottled in bond bourbon (that I know of) that’s been released in years. It’s good to see Beam’s keeping this new bonded in the general price range, too.

If you’re not clear on what makes a bourbon “bottled in bond,” here’s a quick rundown. As well as conforming to all the regular rules for bourbon, all the spirit in the bottle must have been distilled at one distillery, under supervision of the same master distiller, in one season. It must be at least 4 years old. It must be bottled at 100 proof/50% ABV. Most of the remaining bonded bourbons are inexpensive, because they don’t get much promotion or advertising spent on them.

But the most noticeable thing about bottled in bond bourbons is that there aren’t many of them, and most of them are ‘heritage’ brands, ones that were bought up as distilleries failed. Heaven Hill is unusual in that they have two bonded bourbons under their own name, plus the Evan Williams bonded, the Rittenhouse bonded, and a couple others. Beam, of course, has the Old Grand-Dad bonded, which has been a staple at my house since I discovered it two decades ago.

jbbSo the very first question I asked Fred Noe today was “Why?!” Why bring out a new bonded bourbon now, when it seems clear that they’d seen their day, despite the efforts of folks like me, and Chuck Cowdery, and Heaven Hill spokesman Bernie Lubbers to revive them.

“It came from bartenders wanting bottled in bond, people digging up old recipes calling for bottled in bond,” Fred said. “Hell, that’s an easy hit for us; just do what we used to do. It’s not that hard to develop: 4 years old, one season, one distillery, 100 proof. We age pretty much everything 4 years already, just a matter of designing the package. It’s been well-received, they’re excited to get hold of it.”

The package design is a bit of a throwback as well. The old Jim Beam Bonded had a gold label as well. Fred said he used to carry a bottle around with him, the strip stamp was dated 1957, the year he was born. “My daddy (Booker Noe) gave it to me because of that,” he said. “I used to use it to show people what an old bottle of bourbon looked like.”

Fred explained why they were putting another bourbon in the same general price category as Jim Beam White, the 7 year old, Jacob’s Ghost, and Red Stag. “We’re always looking for new ideas,” he said. “But instead of coming up with new stuff, we can go back to the old stuff. We made good stuff back then! Like Old Tub, that’s what my daddy drank. We brought that back just to sell at the visitor’s center. And people buy it! People want the full-flavored bourbons.”

Yes, yes we do. I know I’m ready to get a bottle of this stuff and pour it over a big chunk of ice and take it for a ride. I never thought I’d see the day. First rye comes back, now maybe it’s the return of bonded bourbon. We live in interesting times.

Canada Joins the Show: single barrel Crown Royal at 51.5%

Tuesday, January 6th, 2015

Single malt producers do it routinely and so do America’s bourbon makers. Until now, however, no major Canadian whisky distillery has ever released a single barrel whisky. Finally, as 2014 drew to a close, Crown Royal became Canada’s first major brand to do so. To top that, each hand-selected barrel is bottled at a healthy 51.5% ABV. A whisky year already brimming with encouraging developments in the Great White North concludes with the Canadian whisky story of the year.

Crown Royal Single Barrel Whisky is more than simply a high-strength rendition of the standard bottling we are all familiar with. About 50 different mature whiskies are used to create that blend. One of these is the ultra-flavorful “Coffey Rye,” and it is this Coffey Rye that the brand has chosen to bottle for its single barrel program.

The liquid itself is everything you’d expect from hand-selected barrels, though at first sip you’ll not recognize it as Crown Royal. Still, if you have tried Crown Royal Monarch you already have an inkling of what Coffey Rye tastes like. It is the heart of that 75th anniversary blend.

Since it was first created in 1939, the secret of Crown Royal’s success has been the meticulous mingling of several dozen individual whiskies produced at the distillery. Each makes its own contribution to what many consider the most complex, balanced, and smoothest of Canadian whiskies. If Crown Royal De Luxe displays the elegance of a prima ballerina, Coffey Rye is its muscular NHL-enforcer cousin.

The distillery at Gimli under the blue Manitoba sky

Unlike most Canadian whisky, Coffey Rye begins with a high-rye mash bill rather than a single grain. It is distilled to low ABV in an ancient copper Coffey still that was brought in from the defunct Waterloo distillery. Winters are long and cold in Gimli, Manitoba, where Crown Royal is made, so master blender Andrew MacKay leaves the Coffey Rye spirit in virgin oak bourbon barrels for seven years where it slowly absorbs their lusty flavors. On a recent visit to the distillery I tasted whisky from three of these barrels, and the differences among them were remarkable, varying from succulent butterscotch, through spices, to hard, brittle rye.

Rollout began in late November, in Texas, where liquor stores snapped up the first 519 barrels. Each barrel is exclusive to a single retailer. While there are no barrel numbers on the labels, if you are looking for a particular batch, a medallion around the neck of each bottle notes the retail outlet it was bottled for. Distribution will expand to include fourteen states beginning in February. But Canada’s reputation for keeping its best whisky at home has been dashed: it’s still fingers crossed that Crown Royal Single Barrel will be released in Canada at all.

There’s more. Interest in Crown Royal and Canadian whisky in general has grown to the point where something else that just a few years ago would have seemed impossible is about to become reality. Work is well underway on a visitor’s center, which will open later this winter at the Gimli distillery. Along with production overviews and a history of the brand itself, the center illustrates the story of the Coffey still and its inventor, Aeneas Coffey, and ends in the still house. Visits must be booked in advance and are restricted to groups. Details of minimum group size and how to arrange a tour will be announced once the center opens.

Rye whisky lovers have something very special to look forward to on that tour. Manager Dwayne Koslowski tells you that chocolate bananas are the signature aromas of Coffey Rye, then takes you inside where the first thing you notice is those very smells. Then, as you walk past the large column stills toward the glistening Coffey still at the far end, the scents of cloves and typical rye spices waft in. “We try to keep as much of these aromas as possible in the spirit,” says Koslowski, clearly enjoying the fragrance as much as his visitors.

Suggested retail price for Crown Royal Single Barrel Whisky (the label says “Hand Selected Barrel”) is $55.00.

Disclosure: Davin de Kergommeaux was invited to Gimli to select a barrel of Coffey Rye. He did not receive any compensation for this opinion.

Orphan Barrel Whiskey Release #4: Lost Prophet

Thursday, November 13th, 2014

john hansellI wrote about Diageo’s first three Orphan Barrel (OB) whiskeys here back in January. The whiskeys in these bottlings are from either the old or new Bernheim distilleries. As I noted in that post, they vary in taste, from the easy-drinking, gently sweet, and uncomplicated Barterhouse to the dry, spicy, and oak-driven Old Blowhard. Rhetoric, the third release, is somewhere in between those two flavor profiles, but leaning more towards Old Blowhard.

While all three releases are certainly interesting to taste and diverse in flavor profile, I feel that they never quite lived up to their potential. To me, the optimal whiskey is some blend of these three whiskeys, with Barterhouse being the primary component.

Orphan Barrel_Lost Prophet Bottle Shot_Lo ResProving that they have other arrows in the quiver, Diageo’s newest OB release, Lost Prophet, is not from one of the Bernheim distilleries, but is rather a 22 year old whiskey distilled in 1991 from what was then the George T. Stagg distillery (now Buffalo Trace) in Frankfort, KY. Similar to the previous OB releases, this whiskey spent time maturing in the old Stitzel-Weller warehouses in Louisville, KY (since 2006 for Lost Prophet), and was bottled in Tullahoma, TN, at the George Dickel distillery.

The mashbill for Lost Prophet is 75-78% corn, 7-10% barley, and 15% rye. Serious whiskey enthusiasts will note that this is similar to the “high rye” #2 mashbill formula at Buffalo Trace—the mashbill similar to such brands as Ancient Age, Elmer T. Lee, and Blanton’s. It’s bottled at 90.1 proof (45.05% ABV) and will list for about $120. Similar to Old Blowhard, this will be a one-time release.

Most importantly, how does it taste? I’m happy to report that it’s the best of the four Orphan Barrel whiskeys released to date. It’s complex, balanced, easy to drink, and not over-oaked. Sure, the spice notes (clove, cinnamon), oak grip, and notes of leather are there (it is a 22 year old whiskey, after all), but there’s also a lovely lower layer of sweeter notes (honeyed fruit, soft vanilla, coconut custard) for balance, along with a nice creamy texture. It’s a complete package.

This is a 22 year old whiskey. If you don’t like well-aged whiskeys, you might want to try it before you buy it. But, when compared to other 20+ year old bourbons in this age range (Pappy Van Winkle 23 yr. old, Elijah Craig 23 yr. old, Old Blowhard 26 yr. old, etc.), this whiskey has them beat. And at $120, it’s a better value.

Balcones Founder Chip Tate Speaks Freely

Sunday, October 19th, 2014

Author - Fred MinnickFor the first time since the August 8 temporary restraining order, Balcones founder Chip Tate can talk about the legal battle with his investors. He’s been under a strict media gag order, while the 170th Texas State District Court sorts out the disagreement between Tate and his investors, who alleged Tate refused to attend board meetings and even threatened to shoot board chairman Greg Allen. Allen’s legal team changed the terms of the temporary restraining order, Tate says, and he spoke with Whisky Advocate writer Fred Minnick.

By now, you’ve likely seen Allen’s side of the story. The Waco Tribune, bloggers and other media outlets published court records. We wrote about it here on the Whisky Advocate blog.

Last year, Balcones announced expansion plans for its Waco, Texas, distillery, making it one of the most-promising craft distilleries with award-winning whiskey. Allen and Tate seemed to be off to a great start and the press release offered incredible optimism with Tate saying he was “proud” to call Allen a partner.

But other things happened in a short span of time, and this is Tate’s side of that story.

Minnick: What is going on?

Tate: They were trying to make my life exceedingly difficult for a long while. Ever since I gave them a sense of what the distillery expansion was going to cost, I got a weird vibe from them. These are the investors who were going to fund the expansion. That was the whole premise. So, when I got that weird vibe, I put the figures together … {showing} cost between now and 2022, which is a lot. They’ve been strategically trying to get me out of the business since that moment. They’ve tried different proposals and board action to take over the company.

What did they do specifically?

{They were} trying to make me do daily reports on daily things and busywork. The board meetings were supposed to be quarterly, and this idea of having board meetings every few days is nonsense in itself and is clearly to make my job {difficult}. They said, ‘we need to get multiple signatures on checks and put new policies on travel.’ I asked: ‘Is there a problem with travel?’ This was draconian control based on no particular complaint. I proposed to diligently come up with a plan to meet their concerns. The {board} said, ‘nah. Voted. Seconded. Boom, boom.’ At this moment, they weren’t even going through the motions anymore.

Chip Tate

Chip Tate

But in July 2013, the investors come in and have majority control. Don’t they have final say in what goes on at Balcones?

No. When you do an LLC, you have an operating agreement on how you’re going to conduct business. Basically, there was some explicit language in there. They can’t do certain things without my consent. They can’t financially reorganize the company, which they were trying to force.

They said you threatened to shoot an investor.

The whole thing was absurd. When it came to August 5, Greg Allen stormed into the distillery very abruptly with two sheriffs. They said they would give me a period of time to buy them out. … When I got the written leave agreement, I was to resign presidential powers during a 60 day period and thereafter. When they couldn’t coerce me… they made up a bunch of allegations. They said I wouldn’t give them the passwords they literally took at gunpoint. They said I kept coming to the distillery. And they said I threatened to shoot Greg Allen. The funny thing is they said they had me on tape, and I said, ‘great!’ because I know what I said. What I actually said was in reference to when Greg busted into the distillery, I was talking to one of the other investors and said ‘I could have shot the guy, but instead I greeted him, was friendly and talked to him even though he had two armed sheriffs standing next to him.’ If you listen to the whole conversation, I told {the investor}: ‘you better do something about Greg here. They keep flying off the handle and going crazy, and I try to keep calming everybody down and react reasonably, and we don’t get anywhere. Rinse and repeat. But this can’t go anywhere good, and it can go somewhere bad.’

Do you have plans to sue them for slander or damage to your reputation?

One of the fun things about the American justice system: as long it’s done in court filings, you can’t get libel or slander. … with a few exceptions. I’ve been waiting for the circus to settle down. They released me from the injunction. They’re more envious to strike a deal than originally. Leading up to all of this was me saying, ‘hey, I don’t think you guys are happy. If that’s the case, one of us needs to leave the business before this gets to a bad place. I’d really like to stay. I founded it. If you are amendable, let’s talk about that.’ They turned down one offer after another.

What’s the end result here? Somebody buys them out? You get bought out?

If there’s a future, any future for Balcones, one of us is leaving. That’s for sure…. We {both} have to accept what we planned to happen isn’t happening. We’re not going to live happily ever after. We need to act like grown ups. And what we need to do is basically not pull each other’s shit out in the front yard, light it on fire and have the cops call—that’s not the productive way to handle this. {Using a divorce analogy…} What we need to figure out if I’m going to keep the house or they’re going to. The relationship is over. Let’s be grownups and focus on how we’re going to move forward. Either they’re going to buy me out and let me have my freedom. Or they get bought out.

How much to buy you out? And how much to buy them out?

I can’t really talk about that because we’re about to go in mediation.

The consensus from many lawyers on social media is for you to not fight this and to start fresh when the non-compete ends. Why have you decided to make this your life’s fight?

This isn’t my life’s fight. It’s been going on for two months. Anybody who thinks this is World War III has never started a craft distillery. This is a major skirmish approaching a war.

You’ve had an overwhelming amount of support from colleagues. Somebody even started a crowdsourcing site to raise money for your legal fees. What has that meant to you?

That’s huge. I can’t say how much I appreciate it! The support has kept me going. But still, even for legal reasons, I can’t really spill the beans, but these guys have a lot stuff they don’t want me to say. They misunderstood how carefully I handled them for the last six months. I am not going to lay down for these guys and let them steal from me.

The charge of contempt of court…

That was partially a reporting error. The judge makes final decision, {saying} I’m going to hold you in contempt, but I have some real questions on the restraining order.

Speaking of the restraining order, the temporary injunction is on hold now. What does that mean?

Basically, I’m not allowed to lie, cheat and steal or knowingly hold property that belongs to them. I can’t call up the employees and can’t go to the distillery. They have changed their tune very notably. They ran a full-court press on me and now that they’re done, I’ve said, ‘Is that the best you got?’ Because when I start talking, I want to make sure everybody is listening.

Are you confident you’re going to win?

Yes. If the law works the way it should, we would come to some sort of resolution. I just want to make whiskey again.

Canadian Club releases an all-rye-grain whisky

Monday, October 6th, 2014

Author - Davin de KergommeauxIt was a secret mission. So secret, in fact, that even the operative did not know what it was about. I could name the operative but that would put them at risk. Let’s just say, for the moment, it’s a whisky-loving writer based in a friendly country not that far away. It was mid-April and he flew from somewhere in that country to Louisville to meet Beam Suntory marketing director, Kelly McGregor. Louisville isn’t the easiest city to fly to and it took a full day of travel to get there, another on the return. All that for a single day in Louisville.

When Kelly met him for breakfast she couldn’t help cracking a smile as she told him that a blindfold would not be required for the journey. She identified the destination: the Jim Beam distillery campus on Happy Hollow Road in Clermont. Happy Hollow has a nice backwoods ring to it, but when they arrived at their destination – the product development lab – they were surrounded by the essence of modern science, right down to omnipresent white lab coats.

Canadian Club Rye in rye field“We’re going to taste some whisky,” she finally told him. “We’d like to get your impressions.” So, they toured the lab before he sat down with five scientists and about a dozen glasses of whisky. Some, he reports, were good, some were great, and one was just so-so. All had the rich spiciness, dried fruitiness, subtle sourness, and refreshing bitterness of rye.

They worked in silence, writing their tasting notes, five whiskies at a time, and then, once they’d committed their thoughts to paper, they discussed them one by one. Not which ones they liked or why, just aromas, flavors, and impressions. After a couple more rounds, someone collected all the notes, and just like that, it was over. He still hadn’t a clue what was really going on and he doubted that his hurriedly dashed-off notes would be decipherable, let alone of any value.

Then late in August this year, Rob Tucker, Beam Suntory’s senior brand manager, sent him an e-mail. “I wanted to let you know about our new product launch in Canadian whisky. I cannot reveal it yet, but will be letting you know sometime in September. We were honored that you were able to join our team in Kentucky, and hopefully you got a taste of what I consider to be our obsession with moving the Canadian whisky category forward. This new product, and in particular because it comes from this brand, will open the eyes of many Canadians about Canadian whisky.”

Great news, Rob, but there’s an important detail that’s missing: WHICH BRAND????

In Louisville, his taste buds had told him it was rye, and he knew that Rob was the mastermind behind Dark Horse, one of his favorites. So, when he received an invitation to attend a product launch for a new whisky from Canadian Club, one sentence jumped out at him: “Join us as CC unveils the newest member of its portfolio, honoring the grain that is exciting bartenders and whisky lovers across the country.”

Let’s join the dots: Beam Suntory owns Canadian Club. Bingo! He had it. A new all-rye Canadian Club.

Rob Tucker, Beam Suntory

Rob Tucker, Beam Suntory

It was an educated guess, though Rob still was evading his questions. Then a week or so before the launch, a messenger arrived from Beam Suntory with a bottle. He ripped the package open and lo and behold: Canadian Club Chairman’s Select 100% rye whisky.

Rob finally let him in on the secret. The whisky, he explained, is distilled and aged for 7 years at Alberta Distillers, Beam Suntory’s western Canadian distillery in Calgary and then shipped east to Walkerville, Ontario, for bottling at 40% abv.

Wait a minute! Before fans of “more-is-better” begin to snipe that the whisky is bottled at a standard 40%, take a look at the price. This seven-year-old 100%-rye-grain whisky sells for about $1.50 more than regular Canadian Club Premium. “We could have priced it higher,” Rob concedes, “but we wanted to get it into the hands of 25 to 30 year olds and price is sill an important factor for them.”

A note, then, to US residents who love their rye: Get ready for your cross border shopping run. With just 70,000 cases in the pipeline each year, this new whisky, at least for now, is available in Canada only.

Canadian Club Chairman’s Select 100% Rye was unveiled at a launch held at Toronto’s Spoke Club on October 2 and will be appearing in Canadian liquor stores over then next few months.

And finally, I can reveal the identity of this whisky-loving operative. It’s… Wait! I hear footsteps…

Whisky Auctions to Return to U.S. in 2015

Tuesday, September 23rd, 2014

Jonny McCormickSkinner, Inc., of Boston will host dedicated whisky and rare spirits sales commencing in 2015. Joe Hyman has been appointed to the position of fine spirits consultant to oversee this venture, which is likely to be welcomed by whisky collectors in North America. One impetus to expand into this area was Bonhams’ exit from the whisky auction scene in New York this summer, leaving an absence of any specific auctions for vintage spirits in the calendar.

I caught up with Hyman to mull over his time as head of whisky and rare spirits at Bonhams, NY, to talk about his new endeavor, and to discuss his perspectives on the auction prospects for different categories of collectible whiskies. Straight off, he corroborated the reasons given to Whisky Advocate by Bonhams that the auction house pulled out of whisky auctions in New York for failing to meet their own financial targets.

Why couldn’t they make it work? “It’s different in the States compared to Europe because of all the regulations around alcohol,” explains Hyman. “All the interstate commerce rules, licensing and warehousing issues…everything here has to be under bonded, secure warehouse space, which costs a lot of money. There’s such a layered system that each layer cannot step on any other layer’s toes, so to speak. You’ve got your distributors, your retailers, the auction houses, and shipping agents, so there’s a whole complex web to deal with, that most people in the auction business don’t want to bother with. The big places with huge wine sales, they’ll take whisky if you have $10,000 bottles, but they don’t want to have to deal with it otherwise. I can understand the viewpoint but it’s at a point where it’s growing. I did what I could.”

Joe Hyman

Joe Hyman

Meanwhile, auction houses in Europe have been courting American collectors to consign with them, making offers to ship their whisky collections overseas. Previously, some well-known shipping companies would only insure consignments up to a value of $1,000, inadequate for the needs of collectors consigning dozens of rare bottles, which left U.S. auction houses rather hamstrung.

Hyman has been striving to offer solutions. “I’ve made inroads with the shipping companies and international freight companies that deal with alcohol,” he said. “We can have collections shipped to us to our licensed warehouse, here in Massachusetts. We’ll continue to do the traditional live auctions with phone and online bidding, but we’ll also mix it up with online auctions like the European model.”

“That way, we can handle not only the really cool, expensive items that people get excited over, but we can help people who are looking for old-style whiskies for head to head tasting comparisons,” he explains. Connoisseurs will pay a premium for 10 to 18 year old whiskies from 10 years ago over the ones being produced today, because the flavor profile has changed or the availability of specific wood has altered.

“That environment can create more of a secondary market that the U.S. hasn’t had until now,” Hyman hopes. “Until a couple of years ago, it was eBay, Facebook, or Craigslist, but there is no real go-to place for the secondary market here. We can develop something like that. The $100 bottles and upward are ideal for the online auction environment.”

Skinner held a successful Fine Ales and Spirits online auction last April that included rye, bourbon, scotch, and Canadian whiskies. Furthermore, around 100 bottles of quality whisky are expected to comprise a section of their forthcoming wine sale this fall, before a full whisky sale next year.

What is his assessment of the market potential for whiskey, bourbon, and rye? “It’s going to continue to rise. People have continued to discover bourbon and rye over the past decade. The gains in recent auctions have been outstripping the pace of scotch. A lot of the old bottles are surfacing out of peoples’ basements, closets, and out of walls from the Prohibition era. We’ve not had the same turmoil and looting of basements that there was in Europe during the World Wars. Every time a bottle of significance comes up, then more people go searching through their basements and come up with things.”

What else is hot? “You’ve got the closed distilleries of Japan which have become the Golden Fleece of whisky collecting right now; the Karuizawas and the Hanyus,” he says excitedly. “People can’t get enough of that stuff right now, and it’s escalating. They’re going up at an astronomical rate.”

Canadian whisky has yet to have its moment in the sun as a collectible, but Hyman believes this will change. “People are starting to rediscover Canadian whisky, so that could be the next thing to go up,” he says. “I have bought Canadian whiskies like Canadian Club and Seagram’s VO at auction and they don’t go for anywhere near the same amount of money. I’ve taken these things to whisky events and people are amazed about how good they are.”

What about scotch then? “Even Macallan with their M has become a collectible whisky,” says Hyman. “It’s NAS, but it’s Macallan; not everyone can do this. Your collectibles of tomorrow will be the bottlings with age and vintage statements today. That stuff won’t be available in the future.”

Finally, looking back over your time at Bonhams, what was your proudest moment? “The Cognac 1762 Gautier was the stand out bottle for me, just because of the rarity of it. It was the highest price paid for a Cognac at auction outside of Asia.” Hyman is referring to Lot 947 of the April 30th 2014 sale where the Cognac sold for a hammer price of $50,000. I wonder, does he still dream of a bottle that he would love to auction one day? “Ardbeg distilled in 1815 maybe!” he says with a chuckle. “As a whisky enthusiast, I think a Springbank 1919 would be pretty exciting.”

The Skinner Fine Wine sale will be held on October 28th/29th 2014 at 6pm ET

The New Diageo Special Releases

Monday, September 15th, 2014

Author - Ian BuxtonOnce again it’s time for the annual Special Releases series from Diageo – everyone’s pantomime villain that the collectors love to hate (while secretly rushing to buy the bottles).

This year, Whisky Advocate was granted a sneak advance tasting. All eleven of the whiskies will be available in the U.S., albeit in limited quantities, so I have listed them all in the table together (see below) with the essential information on age, pricing (in UK Pounds; no U.S. pricing available as yet), % ABV, and the number of bottles to be released. (Incidentally, if you’re perplexed on the apparently odd numbers, you’ll find they all divide neatly by 6, thus indicating the total number of 6-bottle cases that will be shipped.)

What do we observe from the list? The usual favorites are there: Port Ellen, Rosebank, Brora, Caol Ila, and Lagavulin all make an appearance. But there are one or two surprises, including a first ever Special Releases’ bottling of Strathmill, and a venerable Singleton of Glendullan, at 38 years old the grand-daddy of this group.

The pricing, as we’ve come to expect, doesn’t offer any bargains nor, I suspect, make it likely that anyone will make a toss-the-cork session with these bottles, no matter how good their friends. Diageo have long-since understood the reality of the secondary market and determined that they, not speculators, will profit from the demand to own these treasures. One might recoil in mock horror at some of the prices but it’s hard to blame Diageo for this trend. Having said that, the Unpeated Caol Ila (£75) and the 12 years old Lagavulin (£80) are both accessible and attainable to all but the most impecunious of enthusiasts. These, thank goodness, are whiskies for drinking.

6 bottle range

As the market for this style dictates all the bottles save one carry an age declaration. The odd man out is the Clynelish Select Reserve. Though I understand the youngest spirit in the vatting to be 16 years old, this whisky is a complex, rich and mature blend created by Diageo’s Dr. Jim Beveridge and, for me, one of the stand-out drams of the collection. It’s a great testament to the argument, increasingly advanced by the distilling industry, that skilled blending counts for more than age on its own. While there are certainly some older whiskies in here, the result is a beguiling, waxy, mouth-coating set of sensations that mix Clynelish’s signature ozone and brine notes with fresh and dried fruits, smoke, fudge, and menthol. This is a whisky that keeps on giving – at £500 a bottle you might expect something sensational and this does deliver.

Brora bottle&boxIt’s far from the most expensive, however. Both the Brora and the Port Ellen releases will break the bank for most of us, requiring £1,200 for the Brora and £2,200 for the 14th Release from the closed and now legendary Islay distillery. But, putting price to one side as we must, those lucky enough to acquire a bottle of either are in for something of a treat: fans of these celebrated distilleries will find much to enjoy. Both need a modest amount of water to fully reveal themselves (but go carefully, as only a few drops are required); both are packed with subtle and complex smoke notes; both need time and some care; both finish long, with pepper and spice (an unexpected ginger edge in the Port Ellen stands out) and the damp, smoldering embers of a wood fire on a beach with salt on the wind call to mind their ancestral homes.

There’s poetry too to be found in the offering from Rosebank; this a bittersweet elegy for another lost distillery. Diageo’s Maureen Robinson perplexed us with her initial comment that the nose carried the scent of “fresh air”, but likened it to the crisp, clean aroma of freshly laundered cotton sheets (a 1,000 thread count sateen if I’m any judge of bed linen). This I thought was the aperitif whisky of the session, a vibrant, zesty palate-teaser that zinged into action from the very first sip. It was young, yet knowing; fresh, yet deep; sweet on the nose, yet by turns clean and drying.

From all parts of Scotland they have come and I surely must mention the Speysiders in the company: The Singleton of Glendullan; Cragganmore; a meaty, big-bodied, blustering Benrinnes that threatened to steal the show (and repelled in equal measure some of the panel) and the debutant Strathmill, initially coy and enigmatic but full of mesmerizing charm – a wallflower that would soon waltz elegantly past a line of eager suitors.

But the finish! Almost all these whiskies left me struggling for descriptors that capture their complexity, charm, and character. Too literal a description scarcely does them justice; too poetic and the reader will be baffled and think the taster bewitched…

So let me finish with the two Special Releases that will be most widely seen, enjoyed and drunk: the 15 years old unpeated Caol Ila and Lagavulin, bottled at what is for this distillery at least an unusual 12 years of age. The result of this policy of the preferment of youth is that there will be plenty to go around, at prices that permit enjoyment without the rueful contemplation of one’s credit card statement.

The freshness and vibrancy of eager youth was evident in both. A hint of smoke could be detected in the Caol Ila, which was soft, generous and giving and packed with vanilla, where the Lagavulin was all pulled pork BBQ with smoky bacon topping and a peat sauce. But then rich fruit notes emerged from the misty smoke, an autumnal note crept forward and a tentative, delicate, fugitive sweetness offered up its still, small voice.

If you are sufficiently fortunate to come into possession of one of these whiskies – any one of them – then do not hoard them; do not place them on some remote, unattainable pedestal; do not venerate them, but share them freely (yet with appropriate discretion). Induct some neophyte into whisky’s riches or exchange a dram with another privileged connoisseur.

‘Special’ these releases may be, but I implore you to set them free. It is noble work, and you will be the better for it!

DISTILLERY AGE AT BOTTLING YEAR DISTILLED UK RRSP % ABV NUMBER OF BOTTLES
THE SINGLETON OF GLENDULLAN 38 1975 £750 59.8% 3,756
CAOL ILA – UNPEATED 15 1998 £75 60.39% 10,668
CAOL ILA 30 1983 £425 55.1% 7,638
CLYNELISH SELECT RESERVE 1999 £500 54.9% 2,964
CRAGGANMORE 25 1988 £299 51.4% 3,372
LAGAVULIN 12 2002 £80 54.4% 31,428
PORT ELLEN 35 1978 £2,200 56.5% 2,964
ROSEBANK 21 1992 £300 55.3% 4,530
BENRINNES 21 1992 £240 56.9% 2,892
BRORA 35 1978 £1,200 48.6% 2,964
STRATHMILL 25 1988 £275 52.4% 2,700

The Balcones Controversy

Thursday, September 11th, 2014

Author - Dave BroomThe extraordinary reports coming out of the Balcones distillery in Waco, Texas may yet be seen as the first of many such scenarios as venture capitalists set their sights on the craft distilling industry. The distillery founder, Chip Tate, has refused to attend board meetings with the venture capital group that owns a majority stake in the company; the VC group has, in turn, accused him of what amount to terroristic threats. Whiskey-lovers are up in arms, fearing the outcome for this iconic craft distillery; the Twitter hashtag #nochipnobalcones is spreading.

Here’s what’s happened. The distillery was established — indeed, was literally built — by president and head distiller Chip Tate in 2008 and has subsequently become one of the flagships of the U.S. craft scene internationally. With demand for the Balcones range rising, Tate needed to increase capacity and in, 2013, he and second round investor Michael Rockafellow accepted a substantial offer from a group headed by Greg Allen, along with a number of smaller investors, which bought out Stephen Germer (Balcones’ initial investor), giving them a majority stake in the company.

Allen’s background is with his family’s food processing business. Prior to that he worked in Goldman Sachs’ mergers and acquisitions department and as an attorney specializing in venture capital financing and emerging growth companies.

Chip Tate

Chip Tate

It appears that a combination of differing philosophies as to future strategy, a clash of personalities, and concerns over the rising costs of the distillery expansion has resulted in a deterioration in relations between Tate and the new board, with them moving to significantly reduce his role within the company he founded. As a result of this, Tate refused to attend board meetings.

On August 22nd, the boardroom battle ended up in court, where judge Gary Coley granted a temporary restraining order enforcing a 90-day suspension on Tate. According to the board, his “unconscionable and reprehensible” behavior could delay the $10 million distillery expansion project. They also alleged that Tate had threatened the life of chairman Greg Allen and suggested he would rather see the distillery burn than have it wrested from his control, claims which most commentators feel were made in the heat of the moment and are hardly credible.

While Allen has made some documentation available to the court, the restraining order has gagged Tate, preventing his side of the story to be heard. (For the record, we have not attempted to speak to him, nor have we received any communication from him.) A hearing in the case is set for Sept. 18.

It leaves a number of questions. The extreme reaction of the board to the apparent rise in costs of the new facility (inevitable in any distillery build) has raised questions as to the financial stability of Allen’s investment group, and makes some analysts wonder whether the Allen-led consortium was investing in Balcones with the intention of selling it at a profit soon after the expanded plant was in production.

If so, this will not be the last time we will see this happen. Investors unfamiliar with the long-term nature of the whisky business are liable to only see potential profit, with no great understanding of the deep pockets required to invest in plant, warehousing, and inventory. What further complicates matters where craft distilleries are concerned is that they are not just buying into a brand, but a highly personalized vision. Without Chip Tate, is there — can there be — a Balcones?

Photo: darkrye.com

Happy 60th anniversary, Jimmy Russell!

Wednesday, September 10th, 2014
Young Jimmy Russell: all-Kentucky basketball player

Young James Cassidy Russell: all-Kentucky basketball player

Sixty years ago today, in 1954…

 

Jimmy Russell started working at the Wild Turkey distillery, at the age of 18.

We at Whisky Advocate, from founder John Hansell on down, our entire staff, would like to say: Well done, Jimmy!

We’ve talked to Jimmy over the years. Here’s some of his story, as we’ve reported it in previous issues.

“Really, my wife, Joretta, was working here before I was,” Jimmy recalls, “and my dad worked at the Old Joe distillery here in town. There were four distilleries here at that time. It was us, then where Four Roses is now was known as Old Prentice, the Hoffman distilling company, and Old Joe distilling, where my dad was. I was fortunate enough to get on here and haven’t been able to get away yet.

“This is really the only full-time job I’ve ever had,” he says. “It wasn’t hardly the same as it is now. They called it ‘Quality Control.’ Now you do Quality Control and people bring you samples and you sit there and run them. Back then, you went and got your own samples, and then you might be unloading a truck of grain after you run them. Unloading it with a shovel!”

Jimmy learned distilling from Mr. Bill Hughes (that’s how Jimmy always refers to him). “Mister Bill was a seven-day man,” as Jimmy puts it. “He lived up on top of the hill, and he was here seven days a week. He’d worked before Prohibition, here at this distillery.”

Real Wild Turkeys, real Jimmy Russell

Real Wild Turkeys, real Jimmy Russell

“When I started, about all bourbons were bottled at 100 proof, bottled in bond,” Jimmy notes. “But theirs had to be at 101, and it stuck, because that’s what they liked on this turkey hunt.”

The turkey hunt is the origin of the Wild Turkey name, enshrined in the brand’s back-story. The McCarthy family owned the distillery in the first half of the 20th century. Some of the McCarthys would take bourbon from the warehouses along on an annual turkey hunt with friends in the late 1930s. The friends asked for more of “that wild turkey whiskey,” and the McCarthys decided to sell it under that name.

That probably seems too easy, a story created in the marketing department, but Jimmy remembers hearing the story directly from Thomas McCarthy, who’d been on the hunts. Until the late 1970s, that 101 proof bottling of Wild Turkey was the only product the distillery made.

Jimmy Russell - high res in warehouse

Jimmy is perhaps best know for keeping Wild Turkey made the way he wanted it made, the way he learned to make it from Mister Bill. He has stuck to his guns, and while there have been some changes — additional products, like the rye, the Rare Breed and Kentucky Spirit bottlings, and the whole Russell’s Reserve line — and the entry proof has been nudged up just a little to 57.5%, largely, Wild Turkey is still made the same way it has been for 60 years.

“Any time you have to add [water],” Jimmy says, “you’re going to reduce your lighter flavors. But, you know, all of us have different ideas, and we all make good bourbon.” He pauses. “But that’s how we make ours,” he said.

60 years ago, it was made the Mister Bill way. Now it’s the Russell way.

Author - Fred MinnickThat was then; this is now. Fred Minnick reports on a ceremony last week that honored Jimmy with a lifetime membership in the Kentucky Distiller Association, just one of the celebrations that have been taking place this year.

Wild Turkey master distiller Jimmy Russell thought the Kentucky Distiller Association’s September 2 board meeting was just another meeting. He was wrong.

As Russell walked down the long, sloping Wild Turkey lunchroom entrance, a surprise-party audience stood on its feet, roaring, clapping, and ready to commend a friend, a bourbon legend, an iconic Kentucky figure who could win the state’s governor position if he ran. (At least, that’s what Kentucky governor Steve Beshear said.)

Jimmy and plant manager Rick Robinson

Jimmy and plant manager Rick Robinson

The first to embrace the “Buddha of Bourbon” was his distillery sweetheart and wife, Joretta Russell. “What are you doing here? What’s going on?” Russell asked, embracing his wife to the sound of joyous clapping.

Russell was being honored with the KDA’s Lifetime Honorary Member Award, making him only the sixth person since 1880 to receive the honor. It’s the latest honor bestowed upon Russell. He’s in the Bourbon Hall of Fame, the Kentucky legislature passed a Resolution to honor the distiller, and Wild Turkey’s parent company, Campari, has practically shifted all of its 2014 Wild Turkey marketing dollars to promote Russell’s 60th anniversary. This private event was the industry lobby’s chance to recognize Russell, who joined the KDA board May 16, 1978, and remains Wild Turkey’s alternate director.

“If there was a Mount Rushmore of Bourbon, Jimmy Russell would be one of the first faces on it,” said Eric Gregory, the executive director of the KDA.

Jimmy and his brother, Dickie Russell

Jimmy and his brother, Dickie Russell

After a round of thoughtful remarks from KDA members, a few laughs and a documentary dedicated to Russell (see above), where I learned Russell was thought to be Kentucky’s best athlete during his youth, I caught up with the legend to ask a few questions.

Was this really a surprise?

This is one they put over on me!

What does the Lifetime Honorary Member Award mean to you?

This is unbelievable. Seeing all these distillery people, this is something I’ll always enjoy. Being here in Kentucky and in the bourbon business, we help each other all the time.

This honor is about your KDA role. Give me a KDA story.

There are a lot of them. Over the years, I’ve been a member for, gosh, I don’t know how long. But a lot of things went on. They’d get rowdy at times, but we all ended up agreeing with one another.

Any really intense meetings?

There have been several intense meetings over the years. When they had the sales tax in Kentucky, they first put it on the distributor. And then five or six years ago, they put another sales tax on the consumer. We went to the Capitol steps in Frankfurt, Kentucky, and poured out bourbon all over the steps.

Over the years, the KDA has been involved with lawsuits with Sazerac. What has it been like being a board member during these situations?

It’s one of those things. We all have disagreements we get into, but we’re all still friends in the business. Some people want to do it one way, some want to do it another way. Usually, the KDA resolves their problems and ends up working everything out.

What does the future of bourbon look like?

I hope great. If not, we’re in deep trouble. Our company spent more than $100 million over the last five years, and we’re putting away bourbon we’re not going to sell for another eight years. If it doesn’t keep going, we’re going to have a lot of bourbon seven to eight years from now.

 

 

Jimmy's family: his wife, Joretta, and two sons: Mike (on the left) and Eddie

Jimmy’s family: his wife, Joretta, and two sons: Mike (on the left) and Eddie

We’re lucky to have him. Perhaps the greatest tribute to Jimmy is the one his son Eddie pays him in the video. Here’s what he said. “The question I got when I first started going out on the road was, ‘How are you going to fill those shoes?’ And my complete and honest answer is, ‘I’ll never fill those shoes.'”

And Jimmy? We’re going to see him for a while, of course. He’ll be at WhiskyFest in San Francisco and New York this fall: he’s the only person in the industry who’s been to every one…and there are only three of us on the staff who can match that record! But when the celebrating and the honors of his anniversary year are over, he’s going to keep on working, making Wild Turkey whiskey the best way he knows how.

“I hope that’s the way it is when I leave here,” he says at the end of the video. “I’ll come to work that morning, and that afternoon, when it’s time to leave, just walk out. That’s the way I’d like it to — it’ll never happen that way, I think, but that’s the way I would like for it to happen.”

We hope you get your wish, Jimmy. You’ve earned it.