Whisky prices to rise by 10 per cent?

[Iain]

See the Edrington view here:

http://scotlandonsunday.scotsman.com/bu ... 1025622007

What do you think?

[Feldrin]

Well that sounds very plausible. Distilleries often have quite a limited amount of production, and it always takes a while before an industry can adjust to a higher demand.

But, seeing as there are already quite a few bottlings that are limited to for example Europe or even just a few select countries (Redbreast 15y for example) I don't think the price-rise will be that strong all over the market. The average price in the world-market will probably rise but the European price should logically rise slower compared to the Chinese one.

Also, once the production has caught up with the demand the price should actually become lower again. Well, unless demand just keeps rising that is.

Hmm, I'm not that good with economics though. Could be wrong.

[irishwhiskeychaser]

In relation to Luxury goods (i.e. Whisky) I would suggest that any price rises will be pernament. It is very seldom that you see across the board price reduction in Luxury goods unless there is a severe fall in the market.

[Dangerous_Dave]

The price hike will be a pain, but the extra demand should see more re-openings and new distilleries in the long-term, which will lead to greater choice for the discerning whisky punter. That's assuming whisky isn't a passing fad in these countries!

[malthead]

I agree - more demand for whisky is good and hopefully will mean more distilleries will be in re-opened / built. However my worry is that instead of re-opening classic distillers but could result in more factories being built!

One thing is for sure the big guys must be fairly confident of continued growth in demand to openly come out and say prices are going up!

Lets stock up while we still can afford it!

[vitara7]

diageo announced a slow down or expected one in the us market so its all relevent, one place up, another down.
there just looking at trying to blame the chineese for them getting greedy and have some poor excuse for trying to bleed us dry

[Spirit of Islay]

Couldn't agree more Vitara7 , all we've heard recently is BRIC this and BRIC that , i can't see these countries paying the prices we do a bottle so are we going to pay more to make up for it ? All it means in the long run is if the price goes up here , i buy less ! As it happens i have a bit of stock in the cupboard to keep me happy for a little while !

[Deactivated Member]

I agree - more demand for whisky is good and hopefully will mean more distilleries will be in re-opened / built. However my worry is that instead of re-opening classic distillers but could result in more factories being built!

There was discussion here before about the reasons most old distilleries will never reopen--I think it was covered in a WhiskyCast episode. The major reason is that it's too difficult and expensive to bring them up to modern environmental standards--apparently it's actually cheaper to build new. Actually, I don't much care what the big boys do in that regard--it's much more interesting to see what the small independents are up to.

Time to get over it, boys and girls--Port Ellen and Rosebank, among many others, are gone forever.

[Frodo]

Time to get over it, boys and girls--Port Ellen and Rosebank, among many others, are gone forever.

Hopefully Imperial will be opened shortly!

[Frodo]

A brief observation I'll make - the LCBO prices for older whiskies seem to have risen quite dramatically while the 10-15yr old malts have seen a 5-10% increase or thereabouts. The new prices for 25-30yr old malts are pretty bad, and prices for independant malts are also rising.

None of the new bottlings I would buy because of prices, but some of the limited shipments that have hung around (not sold out yet) seem to be worth a second look to me. Examples are...

- 28yr Authroisk Rare Malts @ $145
- 12yr Bladnoch (James Macarthur) @ $120
- King of Scots (Rare & Extra Old) @ $45

I was too late to pull the trigger on 20yr Talisker @ $155. The only new one that I considered buying is Bowmore 16yr (Sherry) @ $130. The new prices on the Rare Malts series has really shot up!

[vitara7]

frodo, the reason the rare malts have jumped up is due to the rising interest in the range now its been discontinued, also that and diageio and bottlings no more rare malts to replenish what stocks they do have of the stuff at the warehouses, its the old econ 101, supply Vs demand, to be honest, even at $145 for the auchroisk, that works out about £72, id buy at that as they go for more on ebay, and lets face it, where are you goign to get a 28yo auchroisk for that kind of money?

[Frodo]

I hear what you're saying. The thing is, I buy to drink not to collect. I vaguely remember having a pour of this at a friend's house. My verdict was that it tasted like an oakier, silkier version of Glenfiddich 12, although it was one dram out of many.

Intersting that I wouldn't have bought this a while ago, but am thinking about it now. Goes to show how the single malt market is changing.

[hpulley]

Frodo, that Bladnoch CS is only $112 It's really good as Wendy will attest to. I've had about 6 bottles already, have one open and one (likely final) backup. There are only 5 bottles left in the province so don't think about it for too much longer (the stuff was bottled ages ago).

That Auchroisk looks like a good deal actually, for a 28yo cask strength that is quite good. Too bad there are just two bottles left (one is actually near me but I'd rather buy something else, good deal or not).

Harry

[Frodo]

I'm torn between picking up either the Authroisk or the Bladnoch, or waiting for a vintages* sale to see what comes up. There hasn't been a vintages sale in quite a while, and I'm curious to see what the flood gates will bring. Meanwhile I have more than enough to keep me occupied (about 27 bottles unopened).

There are a few bottles that I'm waiting to see if they will be sold off at a discount.

- Tullamore Dew Heritage @ $56
- Bushmills Single Cask bottlings (Rum or sherry cask) @ $120 or $150.
- A few OMC's or Provenance bottlings. Would like to take a chance on a 20yr Coleburn OMC (sherry cask) but not at $200!
- I'm hoping a current Provenance bottling of 15yr Jura will be left untouched and then go on sale, as the LCBO had to slash prices to get rid of Jura OB bottlings.

*Vintages is a wing of the LCBO that buys limited shipments of wine and spirits. Vintages items are not sold in all LCBO stores. A rule of thumb - the bigger the store, the larger the Vintages selection.

[Lawrence]

frodo, the reason the rare malts have jumped up is due to the rising interest in the range now its been discontinued, also that and diageio and bottlings no more rare malts to replenish what stocks they do have of the stuff at the warehouses, its the old econ 101, supply Vs demand, to be honest, even at $145 for the auchroisk, that works out about £72, id buy at that as they go for more on ebay, and lets face it, where are you goign to get a 28yo auchroisk for that kind of money?

Well the rules for supply and demand are true I very much doubt that it applies to the numpties at the government liquor monopolies across Canada. For them it is all hefty margins regardless what is happening in the free market else where. The mark up in BC is 270%.

[Frodo]

N/A

[vitara7]

270% mark up and i thought sukinder was bad.....

[malthead]

Frodo,

You say about Imperial reopening is that wishful thinking or do you have insider knowledge? It would be great if it did reopen!

[Frodo]

No insider knowledge. But the distillery is mothballed not demolished so I'm keeping my fingers crossed!

[Deactivated Member]

Frodo, that Bladnoch CS is only $112 It's really good as Wendy will attest to.

I'll go along with that, also. Speaking of the possibility of rescuing mothballed distilleries, Bladnoch is a wonderful success story. Still, it's a tough one to find sometimes, and I still regard the output of the former producers as being well worth searching out, in the same vein as Rosebank.

The Imperial site was up for sale when I went by it a couple years ago, but there has been some talk of refurbishment and reopening, as I recall. I hope someone here will have a better recollection of the chatter than I.

As far as price rises are concerned, of course S&D will play their role. I wonder, though, about the strategy of the big drinks companies. Do they regard single malts as a growth market, or a fixed and finite niche to be milked for all it's worth, and no more?

[The Fachan]

Frodo,

Sorry to say that most of the hardware has been stripped out of Imperial in the Allied days so the expense of re-starting Imperial is probably going to be too much now.
The site was put on the market by Allied and has proposed planning permission for housing. the sale was withdrawn by Chivas Brothers in 2005 when the valuation for the site wasn't met. I hope not but I think this one has gone.

[Frodo]

Ouch! - More bad news...

[Frodo]

In relation to Luxury goods (i.e. Whisky) I would suggest that any price rises will be pernament. It is very seldom that you see across the board price reduction in Luxury goods unless there is a severe fall in the market.

Case in point. There was a tequila shortage a while ago that prompted large price increases (35-45%) on bottom-shelf tequila like Cuervo and Sauza. The drought that caused the shortage in agave plants is long gone, but much of the price increases in the industry have stayed. I guess they found out that the market will accept higher prices so why would they lower them?

[smsmmns]

http://news.bbc.co.uk/1/hi/business/6965674.stm
The increased cost of grain won't help anything any.
Stock up while the going is good (!?)

[LeoDLion]

Since a main ingredient in bourbon whisky is corn and there is an upsurge of ethanol production from corn here in the US, there won't be as much corn available for bourbon whisky production. I expect the price of bourbon to go up too.