If there’s one reason England needs to stop Scotland leaving the UK it’s scotch whisky.
The Scotch Whisky Association (SWA) has released new figures on what all those wee drams add up to for the economy and the numbers are astonishing. Scotch represents more than 20% of the UK’s total food and drink exports. It’s 73% of Scotland’s export output.
Scotch is the biggest net contributor to the UK’s balance of trade. In 2016, the UK trade deficit would have been 2.8% larger, at almost £139 billion, if it wasn’t for whisky.
The SWA says scotch exports increased last year by 4% to more than £4 billion ($AU7 bn), and more importantly, the value of single malt exceeded £1bn for the first time.
Volumes overall were up almost 5% to more than 1.2 billion bottles. It’s the first export increase since 2013.
Single malt exports – think brands such as Glenfiddich, Ardbeg, Glenlivet, The Macallan – jumped nearly almost 12% to £1.02bn ($AU1.75 bn), equating to around 113 million bottles and a quarter of the total export market by value.
Here’s how scotch exports have performed over the last decade:
Bottled blended scotch still takes up the lion’s share of the market at 69% of all Scotch volumes and values exported in 2016. The good news for blenders such as Johnnnie Walker is that value increased for the first time since 2012 by 1.4% to £2.75bn.
Single malt was a stand-out performer last year. With single malt exports growing at a faster rate than that of scotch overall, market share is increasing. It now makes up just over a quarter of the total value of Scotch exports.
The Scots have something to thank England for, with the decision to exit the EU driving down the pound, and the sterling’s weakness having significant impact on exports in the second half of 2016, the SWA says.
The industry found eight new markets and now exports to 182 countries.
The USA is whisky’s biggest market by value, growing 14% to reach £865m, with single malt exports up 22% to £267m.
France comes in second with about half that amount, and value dropped 2.2% last year. Singapore comes in third, followed by Spain, Germany and the UAE – an impressive effort given you have to have a license to drink at home – and value rose by 6.8% (£131 million).
Australia ranks ninth by value, up an impressive 11.7% last year to crack £100 million ($AU172m), however, total consumption fell by -4.3% to 29 million, putting us behind Japan, where consumption jumped a massive 20% to 30 million bottles.
India is the market that has distillers most excited, despite a 150% import tariff. Value rose 14% to £97m, but India is already whisky’s third biggest market by volume, at 94 million bottles, an increase of 18.4% last year. The Scots are pretty keen to see London get an FTA up and running with its former colonial outpost.
Here’s a chart showing who’s shouting “slàinte!” by nation.
That said, Brexit has the association concerned.
Acting CEO Julie Hesketh-Laird said distillers are feeling optimistic, with demand rising in mature markets, such as the USA, and newer markets, including China.
“This confidence is reflected in the number of new distilleries – 14 have been opened in the last few years and we know of about another 40 in at various stages of planning,” she said.
“However, we have to be alert to the challenges, as well as the opportunities, of Brexit and political changes in the UK and across the globe.”
You can read the Scotch Whisky Association’s full report here.
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