Wow! That was something. 2020 felt like one of the most outlandish years in near history. However, life has its own ways for us to adapt to bizarre things. When I was writing ‘Whisky World In 2020’ last year, I couldn’t foresee the pandemic or any oddness that happened in 2020. So, hoping to have a better 2021, let’s make some assumptions for the whisky world in 2021.
Covid – 19
Covid-19 hit the whisky world like everything else in 2020. When we were all locked down in our homes, one of the questions that rose in my mind was the future of the whisky industry. As we are all aware now, bars and restaurants were hit the most from the outcomes of Covid-19. We have experienced closures and layoffs. The best answer coming from the on premise was their pivoting. They changed the usual ways of working and served to go cocktails wherever available. Some venues injected cash by selling their precious inventories. Some started to offer virtual tastings.
Even though retail part of the industry exploded with business, producers, distilleries and smaller brands exporting to the US experienced tough times due to customers’ lack of exploration chances. Thus, retail stores and liquor stores in the US also had to understand the e-commerce environment in 2020.
I frankly don’t see any huge changes in the first half of 2021. Vaccination will play a big role in the industry to start getting back on its feet and that will take a serious time. Hopefully starting from the third quarter we will see some improvement, and I can only wish to get back to my favorite bars to order some Whiskey Sour.
Tariffs resulted in a huge decline in the Scotch whisky market. Scotch exports to the US showed a 30% decline in sales in 14 months! Of course, Covid-19 also helped the tariffs to make things worse. Even though, Scotch market found some opportunities in other countries like India, China and Africa.
The good news is, in December we heard about some possibilities to lower the tariffs. There is also some hope emerging around the new US government to roll back them.
On the other side of the pond, UK’s tariff implementation resulted in a 27% decrease in American whiskey, which is actually worse than the overall decline of American whiskey in Europe. Of course, we are just hoping that this situation will disappear and we will have a better market soon.
New Bottle Sizes for the US Market
The Alcohol and Tobacco Tax and Trade Bureau, also known as TTB, gave us one of the best news in 2020 by announcing the addition of the new bottle sizes for distilled spirits. According to the article, distillers can now use 700, 720, 900 mL and 1.8 L bottle sizes. That sounds interesting, but what will change?
The answer is a lot of things will change. The first possible and imminent change we will see is more limited edition whiskies and distilled spirits being imported to the US. Suppliers had to create a 750ml bottling for the US market which increased the expenses. They had to project how much they can sell in the country and export their products to the US regarding this number. With the addition of 700ml bottle sizes, they now can feed the market as needed instead of taking risks.
Another advantage of this will be for US producers. These producers had to create a 700ml bottle line for their exports to Europe. Now that they have the chance to sell 700ml bottles in the US, they can plan their year and cut down unnecessary expenses, which I believe will not be immediate action, but it will happen soon enough.
Whisky Festivals Going Digital
We all love whisky festivals, gatherings, masterclasses, tastings and so on. Covid-19 forbid us to see our friends and getting together in 2020. Will we ever get back together??
Unfortunately, I don’t see a healthy organization happening in 2021. We are talking about hundreds of people gathering in close environments, talking face to face with industry professionals. Toasting glasses, losing their masks to sniff whiskies… If it happens, that is what we will call a super-spreader event!
Luckily, last year, Whisky Exchange and in February 2021 Whisky Magazine will use digital platforms to offer their festivals to be experienced at home! Honestly, The Whisky Show was very promising and Whisky Live at Home is coming very strong.
In the US, we still don’t have a major festival migrated to an online platform yet, but I believe we can see at least one happening this year.
Rise of the Irish Whiskey
Irish whiskey was on fire in 2020, and they don’t look like they will step back this year either. Waterford, Bushmills, Athru, Glendalough released vibrant whiskies that we talked about during the years, and the numbers also show the increase in the value of the Irish whiskey industry.
As I discuss the whiskies coming from Ireland, it just becomes more and more real that Irish whiskey emphasized their importance in the industry especially between 2010 and 2020. I just can’t wait to see what will happen in the new year.
No matter what, we are looking 2021 in a very positive way. Whatever happens, we will try to pivot, adapt ourselves as we did last year. All the things I mentioned above are just my humble thoughts about the upcoming year. Just like you, I would love unicorns and rainbows in the industry, but history has shown us there will be challenges and whisky world will overcome them all together with support and love!