Drinks companies are scrambling to take advantage of the booming Irish whiskey market.
Irish whiskey has grown 131% by volume globally in the last decade, compared to a 13% rise for Scotch whisky and 56% rise for bourbon in the same period.
While Irish whiskey sales are smaller than scotch and bourbon sales volumes at just 7.8 million cases in 2015, the strong growth rate makes it the world’s fastest-growing spirit.
In its new ‘Export Performance and Prospects for 2016-2017’ report, Irish food board Bord Bia estimates that Irish whiskey exports will double in volume terms by 2020 compared to 2015, with a further two-fold increase to 24 million cases by 2030.
The Irish whiskey sector is currently dominated by Pernod Ricard’s Jameson brand, which makes up 67% of all global volume and is responsible for much of the category’s growth.
This week, Pernod Ricard released its results for the first half of the 2017 financial year and reported a “strong performance” led by Jameson, which saw sales surge by a massive 20%.
Irish Distillers, the company that produces Jameson, Powers, and Redbreast, is set to up its production of Irish whiskey by a third in 2017, making a 12 million euro investment in new distilling tanks at its Cork distillery.
Tommy Keane, head of distilling operations at Irish Distillers, told the Evening Echo that 2016 was a year of “fantastic” growth for their brands, with global interest in Irish whiskey continuing to grow.
“It was a really strong year,” he said. “This was led by the US, but also South Africa, Eastern Europe and Russia. Year-on-year, our growth profile remains extremely strong.”
Last year, Jameson whiskey celebrated its 27th consecutive year of growth, selling more than 5.7 million cases worldwide for the year ending in June 2016. It represents one-quarter of Pernod Ricard’s total sales in the US, and is enjoying double and triple-digit growth in 62 of its 130 markets worldwide.
Diageo is eager to get a piece of the Irish whiskey pie, after exiting the market in 2014. The company sold its Irish whiskey brand Bushmills in 2014 as part of a deal to acquire Mexican tequila brand Don Julio. At the time, analysts criticised the decision, noting tequila appeared to have reached its peak while Irish whiskey was continuing.
Last week, it announced it will spend 25 million euros building a distillery in Dublin to produce its new Roe & Co label. Its master blender, Caroline Martin, has been trialing more than 100 prototype blends for Roe & Co since December 2014.
There are currently 30 new or proposed Irish whiskey production sites across the island of Ireland.
Last month, plans were approved to develop a 14 million euro Irish whiskey distillery for Niche Drinks’s The Quiet Man brand.
Miriam Mooney, head of the Irish Whiskey Association (IWA), told The Spirits Business: “In 2013, there were only four distilleries operating in Ireland, now there are 16 distilleries in production and a further 14 in planning. We are really ambitious for our sector, there is huge potential for growth for both small and large entrants to the category. Last year we launched the Irish Whiskey Tourism Strategy which is an all island strategy that proposes the development of an Irish whiskey trail across the island. We believe that given the right government supports and collaboration of state agencies north and south of the border, Irish whiskey tourism will increase from 650,000 a year to 1.9 million by 2025 across the island.”
