Whisky is having a moment. The world’s two biggest spirits groups, Diageo and France’s Pernod Ricard, are both ramping up capacity and a musicologist is driving the first (legal) distillery on the Isle of Harris.
There is a feelgood factor for the Scottish government, too – hence Holyrood’s welcome for Diageo’s plan, demonstrating “Scotland is very much open for business and investment”.
The industry employs 10,300 and indirectly supports 35,000 jobs across the UK, says the Scotch Whisky Association.
Diageo, producer of Johnnie Walker whisky and Smirnoff vodka, reckons its £1bn investment will create 100 permanent jobs, plus about 250 each year in construction. There will be warehouse expansion at Begg Farm in Fife, while Teaninich in Ross-shire and Inchgower and Glendullan in Speyside are in the picture as sites for new distilleries.
The move will also benefit the 1,000-plus farmers from whom Diageo sources malt. (The company does not expect rising demand to result in higher prices.)
Pernod Ricard, maker of Chivas Brothers’ whisky, has pledged annual capital expenditure of £40m to increase capacity and is opening a new bottling hall in Paisley. It is also increasing distillation capacity by 25 per cent by end-2013 with expansions at Glenallachie, Glentauchers, Tormore and Longmorn.
Cognac may have “stolen a march” on Scotch whisky in China – due to the run down of investment during the Asian financial crisis of 1997-98 – but Paul Walsh, Diageo chief executive, said he was confident of continued growth. “Our forefathers did an outstanding job taking Scotch to the four corners of the earth,” he said.