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June 17, 2022 Climate ChangeWhiskyBy Silvercrest

WE ARE FEATURED IN THE TIMES!

Win an 18-year-old bottle of Bowmore (Aston Martin) special edition from Islay

WE ARE FEATURED IN THE TIMES!

Whisky cask ownership is a great way to hedge against inflation and low interest rates
At Whisky investment UK, they advise that in this unsettled market, whisky does seem the safe bet. It naturally appreciates over time, and evidence can be found all over that purchasing the right cask, stored in the right conditions by a reputable wholesaler
(not a sales broker), can offer average returns per annum of 10% to 12%, with most cask returns ready to maximise within three to six years.

Click button below or image to the right to Win an 18-year-old bottle of Bowmore (Aston Martin) special edition from Islay worth over £300!
Enter competition!
Enter competition!
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Old vintage whisky barrels filled of whiskey placed in order in
May 21, 2022 UncategorizedBy Silvercrest

Investment and Alternative Investment in 2022

At Whisky investment UK (Part of the Silvercrest Group of companies) we have talked a lot about applying a safety net to investments. As a vintage Whisky distributor and as we are also heavily involved in the energy markets and the supply of energy to Whisky distilleries and bonded warehouse operators, we know a little about what we do. And we think we are going into a pretty nasty #recession (or are almost in one at the time of writing 13.05.22). Staff layoffs are likely coming house prices we believe will fall. The demand destruction is everywhere due to the largest monetary tightening in history following the worldwide pandemic, and in the UK, Brexit and now the war in Ukraine.

 

Alternative Investment and Investment Safety in 2022

The #equitymarkets, as we will point out in further posts, have priced this already. The credit markets are beginning to price this and commodities like copper are doing what metals do. Its the YoY rate of change of these assets you need to look at.

The #bondmarket and #oil are the two assets not pricing in future recession yet (due to the supply issues in #energy). Bonds finally decided to join the party and the trend of higher yields lower equities has probably ended. Lower stocks now equal lower yields….

The final show to add to this will be oil, which will break lower. 

Bond yields falling and oil falling will give the excuse to the #Fed to hike prices, maybe in May and then pause (or do one more in June). The bond markets will then begin to price it out.

However, the next 4 weeks are going to be highly unsettling as every position will take a hit. There will be no safe place to hide (except maybe bonds – but most people are short those). 

#Crypto is full of panic. Online debates, mudslinging and fake news reports is usually a sign of approaching the lows. March 2020 was very similar in levels of fear, anger, vitriol, shock and panic. 

Bear markets and recessions are hard and can be of course very financially scary but they give HUGE opportunities. One of the current opportunities for steady growth has to be Whisky. 

We have all read the reports of the chap that bought two casks in 1994, a Macallan for £3200 and a Tobermory for £1500 and later sold them for £225k ! 

And while returns of 4700 % are exceptional it’s not in common.

Whisky Cask Investment at Whisky Investment UK

At Whisky investment UK, we advise that in this unsettled market whisky does seem the safe bet. It naturally appreciates over time, and evidence can be found all over that purchasing the right cask, stored in the right conditions by a reputable wholesaler (not a sales broker) can offer average 10-12% returns safely delivered over as a little as 3-6 years. 

If you are in the market to discuss where your money is safely invested and whisky sold reputably and sustainably then please contact our highly knowledgeable team today. 

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April 25, 2022 WhiskyBy Silvercrest

How to Purchase a Whisky Cask Safely

INTRODUCTION

It is impossible to think of Scotland without thinking of Scotch Whisky. Its roots are firmly embedded in Scottish history and traditions but today it is drunk in the most stylish bars in the world’s biggest cities. For more than 500 years the Scots have successfully taken the natural ingredients which our country has been blessed with – barley, cool clear water, peat and pure clean air – to create the world’s leading international spirit drink.
Distilled in over 130 distilleries dotted around Scotland from the Northern Isles to the Borders it is exported to around 180 markets across the globe – an unrivalled reach for the product of any one country.
Scotch Whisky makes up more than a fifth of the UK’s food and drink exports and the value of annual exports has grown consistently for more than a decade. All of this creates considerable interest in investing in Scotch Whisky, driven by a desire to share in its success.

A personal investment opportunity?

Several companies promote individual ownership of a Scotch Whisky cask as worthwhile and potentially lucrative.
The Scotch Whisky Association is not able to offer advice on the purchase or sale of casks as an investment. Nevertheless, it believes that potential investors, to assess these opportunities, should understand something of the structure and operating methods of the industry.

Scotch Whisky and its market

World exports of Scotch Whisky are currently worth more than £4.9 billion. The majority is used to produce Blended Scotch Whiskies which can contain spirit from many different distilleries.
To meet this demand, Scotch Whisky blenders, who need whiskies aged for different lengths of time, contract with individual distilleries for the supply of the spirit that they require, laying down their stocks several years in advance. This enables Scotch Whisky distilleries to plan and maintain production at appropriate levels.

As a result, there is no regulated market for mature or maturing casks of Scotch Whisky, no officially published list of buying and selling prices for casks from different distilleries or at different ages and no established mechanism for selling. Scotch Whisky casks are not a regularly traded commodity on an open market. It is traded within the industry, sometimes through Scotch Whisky brokers, but primarily by contract between blenders and distillers who will sometimes exchange casks with no money changing hands.

It is possible, subject to availability and willingness, to purchase casks of Scotch Whisky, either newly distilled or maturing, from distillers for personal use. Casks are sometimes also purchased from time to time as a form of speculation with the intention of re-selling them at a profit.

However, it must be emphasised that only a tiny proportion of the total amount of Scotch Whisky produced in Scotland is bought and sold in this way.

Therefore, any investment in a cask made by an individual with a view to selling it on at a profit must be made based on their personal assessment of the risk and the value of the investment to them.

The promotion of investment opportunities

Opportunities to invest in casks have been promoted by several companies both in and outside the Scotch Whisky industry. Sometimes these have included indications of the return that the investors might hope to make.

Scotch Whisky casks however are no different from other commodities, whose values rise and fall according to supply and demand. The only certainty about owning a cask is that it will lose 2% of its contents through evaporation each year. This is something to keep an eye on during a long period of maturation because Scotch Whisky must be bottled at a minimum strength of 40% alcohol by volume.

Warehousing your cask

You are highly likely to be charged for storage and insurance for the time the cask is in the warehouse. There may also be charges if your cask requires to be moved or its contents measured to check, for example, its alcoholic strength. Movement of the cask under bond is strictly controlled and can only be carried out by authorised operators.

Bottling your cask

You will need to factor in the cost of bottling. (Single Malt Scotch Whisky must only be bottled in Scotland.) If a private owner decides to bottle their cask, excise duty will normally be due when the bottles are dispatched to the owner. The duty due will be based on the rate of duty applicable at that point and not when the cask was purchased. Thus, the purchase price of the cask is only the initial outlay.

In 2020 the rate of duty in the UK is £28.74 per litre of pure alcohol to which value added tax at 20% must be added. This will require a further outlay of several thousand pounds on the average cask.
Finally bear in mind that most bottlers are set up to bottle large volumes of spirits and it may take some effort to find one who is willing to bottle a single cask.

Other things to consider

If you decide to make a personal investment in a Scotch Whisky cask you should consider taking the following steps:

  • Clearly identify the whisky on offer. Any company offering Scotch Whisky for sale should be able to confirm whether it is a Scotch Malt Whisky or Scotch Grain Whisky, the name of the distillery where it was produced, the year of distillation and a cask reference number.
  • Check that the offer price is realistic by contacting the distillery or company whose whisky it is or speak to an established whisky broker or specialist auction house.
  • Also check any claimed return with an established whisky broker, but even then, you should treat this with caution as the figure for which your cask might be sold depends on many variable factors.
  • Most distillery names are trademarked and sometimes there will be a contractual limitation on the use of the name should you sell or bottle your cask. Before purchasing, you should check whether any conditions apply, particularly if you are not purchasing directly from the distillery.
  • Consider whether there are any limitations on how you can dispose of your cask. Some sellers may include, for example, a contractual term that it may only be bottled for personal consumption at their premises.

Other things to consider (continued)

  • By law, Scotch Whisky may only be matured in an Excise Warehouse in Scotland which has been verified by Her Majesty’s Revenue and Customs. Therefore, you should check the location of your cask before going ahead with the purchase. You can check to see if a facility has been verified on the HMRC website here: https://customs.hmrc.gov.uk/sdvlookup/index
  • Insist upon receiving a receipt for the purchase price and a copy of the contract of sale which should:
  1. Provide a full description of the whisky purchased i.e. type, distillery, and year of distillation;
  2. Identify the cask purchased and the cask number, the type of cask (ex-Bourbon, ex Sherry etc.) and the volume of the contents;
  3. Identify the warehouse in which the casks are stored and the warehouse keeper; and
  4. Explain the costs connected to the storage of your cask.
  5. Your contract of sale represents your legal title and is proof of ownership of your cask.
  • Check that your insurance is adequate for your needs. Does the insurance cover, for example, loss of spirit because of a leaking cask?
  • If the cask is in a warehouse that belongs to someone other than the seller, you should ensure that the transfer of ownership is properly recorded and acknowledged by the warehouse keeper.
  • Traditionally this was done by way of a delivery order, a document setting out the details of the cask to be transferred, signed by purchaser and seller and then delivered to the warehousekeeper. Nowadays an invoice or owner’s certificate may suffice. Before completing the purchase you should check with the warehouse keeper what documents they require and ensure that the seller can deliver them to you.
  • As the owner of a cask stored in an excise warehouse, you should satisfy yourself that the warehouse and warehousekeeper are approved by HMRC. This also includes ensuring that the warehousekeeper is registered with HMRC under the Warehousekeepers and Owners of Warehoused Goods Regulations 1999 (‘WOWGR’). You might also be required to register with HMRC and obtain a WOWGR approval if you are deemed to be a ‘Revenue Trader’ . Further information can be found in HMRC’s Excise Notice 196 (in particular, section 5).
  • Be aware that as well as reducing in volume, the contents of your cask will reduce in strength over time. It important that you monitor the strength of your cask, particularly if you are maturing it for a long time because if the strength falls below 40% abv, you will no longer be able to bottle it as Scotch Whisky.

CONCLUSION

When purchasing a cask, you should be aware of the special nature of the trade in Scotch Whisky and the costs involved.

Investors should recognise that there are risks involved, both as regards the potential value of their investment and the opportunities to sell it on.

Nevertheless, purchasing a cask for your own personal use can give you immense pleasure and enable you to create a unique Scotch Whisky to your own specifications.

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April 25, 2022 WhiskyBy Silvercrest

‘Forgotten’ cask of whisky expected to set world record price

The Macallan 1988 is being sold by Whisky Hammer.

A rare “forgotten” cask of whisky, bought for £5,000 more than 30 years ago, is expected to set a world record when it is sold in an online auction.

The 374-litre cask, originally filled on May 5 1988, has been held in bond at the Macallan Distillery in Moray for almost 34 years.

The whisky is being sold in an online auction

It was bought on a whim by an expat who then forgot about it for more than three decades until they were reminded by Macallan that it was still maturing in the warehouse.

Bids for the rare cask have already reached 170,000 dollars (£130,000) since the auction went live at 7pm on Friday and are expected to soar before the sale on the Whisky Hammer site ends on Sunday.

The Macallan Distillery in Moray

It is expected to break the record set in 2021 by Bonhams for the sale of a 30-year-old re-racked Sherry hogshead from Macallan, which fetched 574,000 dollars (£439,000).

“This is, without doubt, one of the most exciting casks we’ve seen come to auction in recent years”

Daniel Milne, Whisky Hammer

Daniel Milne, co-founder and managing director of Whisky Hammer, said: “Casks of this age and size are extremely rare, especially from The Macallan.

“This is, without doubt, one of the most exciting casks we’ve seen come to auction in recent years and we expect it to set a new world record by the time the auction closes on Sunday.”

If bottled today, the cask would yield 534 70cl bottles.

The Whisky Hammer April auction, which includes more than 2,000 lots, is live until 7pm on Sunday.

Whisky Hammer is a family-run auction service founded by brothers Daniel and Craig Milne.

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April 20, 2022 WhiskyBy Silvercrest

Whisky on the table as Boris Johnson heads to New Delhi

Leading Scotch maker Chivas Brothers wants to double exports to India if New Delhi eliminates whisky tariffs, a top UK demand in bilateral trade talks ahead of Prime Minister Boris Johnson’s visit to India this week.

India is the world’s largest whisky market and the second-largest Scotch export market by volume. But the industry blames 150 per cent tariffs on imported liquor for holding back growth in the country of 1.4bn people.

Levies on whisky makers have become a sore point in UK-India trade relations and a core issue in trade talks that began earlier this year.

Johnson will travel to India this week and meet Prime Minister Narendra Modi as he looks to advance the negotiations and broaden security co-operation in response to Russia’s invasion of Ukraine.

Jean-Etienne Gourgues, chair of Chivas Brothers, part of France’s Pernod Ricard group, told the Financial Times that “the odds have never been so high” that a trade deal would be reached

Most Indian whisky is locally produced and high levies on imported liquor are an important source of revenue for Indian authorities

Scotch “is a very small portion of all the whiskies which are being enjoyed [in India]”, he said. “The midterm target would be to at least double the size of the market. And with the size of the population of the middle class, I’ve seen the appetite is extremely high. It should become one of the top markets.”

Trade between the UK and India was worth £18.5bn in 2020 but has stagnated over the past decade. By comparison trade between the UK and Belgium in the same year was £38bn.

India accounts for 1.2 per cent of British exports — it is the UK’s 21st-biggest export market — and UK companies sell more to countries including Singapore, Sweden and Norway.

London and New Delhi last year agreed a UK-India Comprehensive Strategic Partnership to boost investment and jobs as part of a plan to double trade by 2030. But analysts remain sceptical that a long-mooted free trade deal could be finalised in time for general elections in both countries in 2024.

New Delhi’s longstanding demand for easier access to British visas for Indian students and skilled workers has also proved politically contentious in the UK.

Anne-Marie Trevelyan, UK trade secretary, has said that “everything is on the table” as the countries look to finalise a deal.

Sam Lowe, director of trade at Flint Global, said the UK had already given India “a lot of what they want” on immigration after Brexit and that a trade deal was possible.

The removal of the so-called Tier 2 cap on skilled workers in December 2020 and the UK’s decision to put Indian workers on the same footing as their EU counterparts was crucial.

But India is expected to push for greater access, to the discomfort of some Conservative MPs and immigration hawks in the Home Office.

“Boris Johnson could do this, but it would involve a bit of a fight with the Home Office,” Lowe said, adding that any trade deal between India and the UK might initially be “quite shallow”.

But Lowe said the politics “were not in the right place” for an early and ambitious agreement, given New Delhi’s refusal to criticise Russia’s invasion of Ukraine.

Indian authorities have long been wary of opening up domestic industry with free trade deals but the country recently signed an agreement with the United Arab Emirates and an interim deal with Australia. Most whisky consumed in India is produced locally and high levies on imported liquor are an important source of revenue. But the country has also long taken an antagonistic view of the alcohol industry, with outright prohibition imposed in several states. The Scotch Whisky Association said it hoped the two countries could reach an interim “early harvest” agreement ahead of a full trade deal.

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February 10, 2022 Climate ChangeWhiskyBy Silvercrest

Drinks firm plans carbon-neutral distillery after gaining new investor

A drinks firm is planning to build a new carbon-neutral, whisky distillery after winning a major new investment.

Edinburgh-based, specialist, consumer-brand investor Inverleith LLP has just secured a majority stake in the Eden Mill St Andrews craft gin and Scotch whisky company.

The drinks firm plans to build a new whisky distillery in St Andrews, with founder and managing director, Paul Miller, describing it as a “really exciting moment” for the business.

He stated: “Having secured Inverleith LLP as the majority investor into the business, we will be able to realise our distillery ambition and unlock the potential of Eden Mill St Andrews as a premium, craft gin and premium, single malt, scotch whisky here in the UK and overseas.

Eden Mill founder Paul Miller said it was an exciting time for the firm.

“With their consumer-strategic-brand and commercial expertise, I  am confident that we have found the right partner to drive and support the next and most significant stage of the Eden Mill journey.”

Eden Mill, which was founded by Mr Miller and Tony Kelly in 2012, hopes to open the new distillery in late 2022.

Meanwhile, the investment will also enable the company to expand its distribution in the UK and internationally.

 

Paul Skipworth, managing partner at Inverleith LLP, hailed the deal as a “fantastic addition to Inverleith’s portfolio of premium, consumer brands.

He said: “Eden Mill St Andrews has one of the most exciting futures within premium gin and whisky and we are delighted to be supporting the realisation of its vision.

“

“As a team, we have a long heritage in the development of premium spirits, both operationally and as investors, and we believe we will be a strong partner for Paul Miller and the wider Eden Mill team over the coming years.

“We admire the work that Eden Mill has done to date in developing high quality, great-tasting gins and scotch whiskies and we look forward to helping the brand and its products achieve international success.”

Paul Skipworth

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January 19, 2022 WhiskyBy Silvercrest

Scotch whisky on the table in trade talks with India

  • Trade talks between the UK and India are now under way, with Scotch whisky on the table as one product with huge potential gains.
  • Experience of failed talks with the EU point to many obstacles to cracking the world’s biggest whisky market, going beyond the 150% tariff.
  • Scotch is only one product among many that Britain wants to export more, including finance and cars, but the compromises required with India’s demands could be difficult for the UK Government.

A bottle of Scotch whisky arriving in the port of Mumbai faces a colossal 150% import tariff, yet it hasn’t stopped Indians from being enthusiastic drinkers of a dram.

India is the world’s biggest market for whisky, most of it termed “Indian-made foreign liquor”. The big brands sound more Speyside than sub-continental: McDowell’s, Royal Stag, Bagpiper, Peter Scot.

Domestic distillers have lobbied fiercely and successfully to limit Scotch imports. If the bottle is sold in Mumbai or elsewhere in the state of Maharashtra, it used to carry a further 300% tariff, though that was recently halved.

Among other parts of the Indian union, some don’t allow alcohol sales at all, except to those who know how to get round the rules.

Scotch makes up only 2% of India’s market. Yet the value of Scotch whisky sales to India has risen from below £60m in 2011 to more than £150m in 2019. That has been on the soaring growth of the economy and the country’s burgeoning middle class, with its drouth for prestige international products and brands.

By volume, last year saw India become the third biggest market for Scotch. But as 60% of that is in bulk, for bottling in India or for blending with local spirits, that is lower value Scotch than exported to other markets.

Unpredictable rules

So imagine what could be sold with lower tariffs. There’s a big prize from getting them removed, or at least slashed. And that puts whisky firmly on the table of the talks, which began this week, aimed at a free trade agreement between the UK and India.

Oxford Economics doesn’t imagine what could be sold: it models it. Commissioned by the Scotch Whisky Association, it assumes that the import tariffs come down to around 25%.

With that, it estimates £1.2bn more exports within five years, and that could generate 1,300 jobs in the UK.

And part of the pitch to the Indian government is that such trade liberalisation would only take Scotch from 2% to to around 6% of the nation’s consumption, while boosting Delhi’s government revenues by more than £3bn. That way, everyone wins.

But trade liberalisation isn’t that simple, particularly in India. One of the first problems is getting to an agreement on the valuation of an import consignment before it even leaves the port. That can take a very long time, and a free trade deal would have to simplify that process.

The application of rules can be, let’s say, unpredictable. One key part of any free trade deal would be a court of arbitration. But as Edinburgh-based Cairn Energy found (it recently rebranded as Capricorn), such existing international rules on investment can get stuck in Indian bureaucracy and legal obstacles.

Having developed the country’s biggest oil field and sold its stake, Cairn’s attempts to reclaim at least $1bn owed by the Delhi tax authorities only began to make progress after it started action to seize the government’s overseas assets.

Lost empire

After leaving the port, imports of whisky into India then hit 30 different markets, across India’s states, requiring different labelling, with different duty and retail rules. Some states have a government monopoly in retailing alcohol, which is open to abuse by those in power.

Those in the distilling industry who have been trying to break down the barriers to trade have low expectations of those internal trade barriers being removed under a deal between the UK government and the federal trade ministry in Delhi.

A deal between national governments would be a big breakthrough, but just the start of a new chapter in trying to crack this market.

After 10 years of the European Union trying, but failing, to get a free trade deal, in which Scotch whisky also played a prominent part, there is some optimism that the mood in India has shifted.

A crucial part of that is that the domestic distilling industry now has more international ownership.

The flamboyant businessman Vijay Mallya, who bought Scotch distiller Whyte & Mackay to add to India’s biggest distiller, United Spirits – along with his empire of brewing, a large airline, premier league cricket, a Formula 1 team and a seat in India’s parliament – is out of the picture now. Living in London, the sun has set on his empire, and he is fighting extradition to his homeland to face charges of money laundering on a vast scale.

Much of United Distillers is now owned by Diageo, the London-headquartered global drinks giant which happens also to own around 40% of Scotch production.

So it is now a big player in Indian distilling and in Scotch, plus gin, tequila, rum and Guinness, which it would dearly love to get into the Indian market. By no coincidence, Indian distillers seem to be putting up less lobbying resistance to imports of Scotch.

Skills and flair

So could this now be the breakthrough for Scotch into the world’s biggest whisky market?

The UK government, with a new-ish trade secretary Anne-Marie Trevelyan, is eager to show progress post-Brexit on reaching beyond European trade to “Global Britain”. There isn’t much prospect of a breakthrough deal anywhere else.

Whitehall brings inexperience to the table, while India’s trade negotiators have lots of experience, much of it in refusing to compromise due to domestic politics and an under-current of belief that India can be self-sufficient.

The trade talks are likely also to feature the desire of Britain’s financial sector to get into the Indian market, to which it currently exports only a 10th of its sales to Japan.

That would require dismantling of massively complex regulatory barriers.

Its lead trade body, CityUK, wants to see fewer restrictions on data flows, and visas for British nationals to work at least temporarily in India. Having seen Cairn Energy and others snared, it is also seeking protection for investments.

The car industry, including Indian-owned Jaguar Land Rover, wants to get access to wealthy customers on the sub-continent.

And India has its own negotiating priorities, starting with much lower barriers for its professionals to work in the UK.

Its view of world trade is the projection of the power of the Indian diaspora – a huge English-speaking pool of technical skills and entrepreneurial flair.

But welcoming many more Indians into Britain could be seen as running counter to the spirit of Brexit, which was to keep foreign workers out.

That would be a tricky political compromise for the UK government to sell to its supporters. It’s one that the Home Secretary, Priti Patel – herself a daughter of that Indian diaspora – is reported to be firmly against.

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December 1, 2021 WhiskyBy Silvercrest

8 tips to know before investing in whisky, according to an expert

From The Macallan to Yamazaki, the price of whisky can range from a few hundred bucks to costing more than a five-room flat. But instead of pissing it away at the end of an evening, why not turn those drams into dollars? We mined a whisky business expert for some tips on investing in the coveted spirit.

Rickesh Kishnani has been making money from whisky for years. In 2014, he launched the world’s first private equity fund focused on rare single malt whiskies with an initial investment of US$12 million (S$16.4 million). The fund exited the market this September at US$26 million (S$35.6 million), generating a 17 percent gross annual rate of return.

The Hong Kong native also cofounded the Glenor Cask Company in 2019, which offers barrels of single malt whiskies for sale, and helped raise capital to build Holyrood Distillery in Edinburgh. Through his company Rare Whisky Holdings, Kishnani also holds a significant stake in the online auction business Whisky Hammer and the e commerce platform Still Spirit.

From how much to invest to what bottles to look out for, read on for Kishnani’s eight tips to know before investing in whisky.

1. Look for a reputable seller

“If you’re just getting started, the biggest thing is to find a trusted whisky merchant who can guide you through the process. For example, they should give you a sample first before you buy a cask. A lot of merchants these days try to offer lists and prices but they don’t let you taste what you’re going to buy. That’s the first red flag.”

“The second thing is to make sure that they have all the correct licenses and ownership paperwork to be able to properly transfer a cask into your name. If you live outside the United Kingdom, you need a company to be your third party duty representative with HMCR (Her Majesty’s Custom and Revenues). You should be able to ask a merchant for their third party duty rep license, and get a delivery order that is signed by the warehouse and the seller.”

“Unfortunately, there are some people out there that are taking advantage of newcomers. If you’re dealing with a whisky merchant that is trying to push you into it, don’t fall for these sales tactics. That’s another red flag.”

2. Stash your investment away

“For a lot of people who buy bottles, they keep those they like to drink at home and store their investment somewhere else. Likewise with casks, which we help them to keep in Scotland. So, it’s just keeping that separation and knowing from the beginning that, ‘Hey, this is stuff I’m going to drink, this is stuff for investment.’ ”

3. Think about casks…

“When you invest in a cask, the value and the price generally go up. Not always, but assuming you have a good cask, good brand and good value, the industry average growth is about 12 to 15 percent return per year. We advise our clients to invest in an 8 to 12 year old cask and hold it for a minimum of three to five years, but it can also be longer. Then they can sell it as an 18 year old. As the age goes up, the value goes up, and you don’t have to worry about external factors and other asset classes.

4. Or hyper rare bottles

“We found that the higher returns are generally on the cask versus the bottles. However, you do find some bottles that appreciate much higher. Right now at our auction, we have a bottle of Yamazaki 55 that is estimated to be anywhere between £400,000 to £500,000 (S$730,500 to S$913,200). It was originally released somewhere around US$60,000 (S$82,200).”

5. Invest in what you can afford

“You can start with as little as you want. You can start with a few bottles. If you’re starting with a cask, our general advice would be probably £10,000 (S$18,200). That would be a minimum level of investment to buy one cask of whisky, which is a great starting point.”

6. This is not a get rich quick scheme

“This isn’t a buy Bitcoin today, sell Bitcoin tomorrow type of asset class. It’s about discipline and setting a clear expectation of return. If you’re trying to achieve, for example, 15 percent per year net IRR (internal rate of return), you have to think, ‘Is it achievable in the whisky market?’ Once you have achieved that over a five year period, then it’s time to start exiting.”

7. Look for aged and vintage bottles

“If you’re investing in bottles, my recommendation would be to look into Macallan. Old vintage Macallan has always been performing very, very well. It’s still the number one brand that’s being traded at auctions. But it’s got to be old, around 18 years and up. When we look at vintage, we mean that it was bottled at least 10 years ago, but ideally as far back as you can go.”

“The other one is aged Japanese, so any Yamazaki or Karuizawa. These distilleries have traditionally done well if they have some sort of age on it.”

“The last is what we call silent stills. Closed distilleries. There are actually three closed distilleries that are going to reopen, which are Brora, Port Ellen and Rosebank. But it’s going to take them 10, 20 years to have an aged whisky. Old bottles from those distilleries are not cheap, but they’re a good bet.”

8. Irish and American whiskies could do well

“There are some Irish whiskies that are doing well. American bourbon, especially some of the top brands and the high age whiskies, are getting a lot of demand. Those two are coming up but you have to be much pickier and selective in those markets. Beyond that, there are many countries around the world that are starting to produce whiskies, but I personally would not grade them as investment quality yet. We don’t have that history of price appreciation. It’s all still new.”

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November 22, 2021 Climate ChangeWhiskyBy Silvercrest

Diageo aims to warm up net-zero credentials with Fife solar farm plans

Spirits giant Diageo – Scotland’s biggest whisky producer by volume – has applied for planning permission for a major on-site solar energy farm at its Leven packaging plant.

Should the plans get the green light, they would see 12,000 solar panels capable of producing four megawatts of electricity installed on vacant land at the 150-acre plant, which produces 40 million cases of premium spirits each year.

The owner of brands including Johnnie Walker and Guinness said the move is part of its plans to achieve net-zero carbon emissions from its direct operations by 2030 – and it is working with energy company E.ON and Emtec Energy, a local Scottish business, to develop the solar-panel farm.


The latter would be entirely within the existing footprint of the Leven packaging plant site

“and is planned carefully to ensure minimal visual and environmental impact on the surrounding area.“

Does making whiskey harm the environment?

Gavin Brogan, operations director at the Leven packaging plant, said: “We have been on the journey to environmental sustainability at Leven for many years and we have made great progress, but this solar array would take us to another level, allowing us to generate our own renewable energy onsite and contributing to Diageo’s global ambition to achieve net-zero carbon emissions by 2030.

“We have planned this carefully and we are happy to engage our neighbours and local stakeholders during the planning application process.”

The firm added that in Scotland, three of its Scotch whisky distilleries – Oban, Royal Lochnagar and Brora – have already achieved net-zero carbon emissions. Diageo also recently confirmed that its Johnnie Walker Princes Street attraction in Edinburgh will open on September 6.

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November 4, 2021 Climate ChangeWhiskyBy Silvercrest

Greener whisky: Scottish distilleries working on reducing carbon footprint

As world leaders gather in Glasgow for the COP26 climate conference, many will be sampling a dram or two of Scotland’s famous whiskies.

And they may even take note of how the industry is leading the way to create a carbon-neutral future.

One of Scotland’s most prestigious whisky makers, Oban, has been looking at ways of reducing its carbon footprint in the whisky-making process.

In 2018, the distillery switched from using fossil fuels to a rapeseed oil biofuel, reducing the distillery’s carbon footprint by 98 per cent.

“It’s given us a transition fuel to be carbon neutral quicker. We have been carbon neutral now since late 2020. It’s allowing us to make that transition step towards zero carbon,” says Callum Rew, the senior site manager of Oban Distillery.

“We wanted to be out there, we wanted to be pioneering, we wanted to be there first and try and do something and learn, so as the other distilleries within Diageo can learn from ourselves.”

“And biofuel was new on the market, so we thought we’ll try it, we’ll test it, it’s a very relatively small distillery here at Oban, so it’s maybe easier to try and integrate it here first.”

Does making whiskey harm the environment?

Whisky making can be taxing on the environment. A huge amount of energy is required to extract the sugars out of the grain in the mashing process before even taking into account transporting the products all around the world.

But the industry has been taking steps to lower the environmental impact.

According to the Scotch Whisky Association, since 2009, there has been a 34 per cent reduction in greenhouse gas emissions.

“A huge amount of energy is required to extract the sugars out of the grain in the mashing processs.”

Karen Betts, chief executive of the associations laid out the industry’s plans: “It’s really important to us that we are sustainable both now and into the future. We think that through collaboration, innovation, investment, ingenuity, and a bit of time, we can get there by 2040. And if we can get there by 2040, we absolutely should.”

On the western edge of the Scottish highlands, Ardnamurchan Distillery has been using sustainable energy sources since its opening in July 2014.

Shift leader in the distillery, Scott Stewart, says that Scotch whisky’s new green credentials will give it recognition all over the world.

“It’s what the country is famous for, it’s so famous for its whisky. So, if we can show that one of our major exports, or biggest export, is being as green as possible and as sustainable as possible and environmentally conscious, then it reflects fantastically on the whole country. And it can be an example to other industries to follow.”

It is estimated the Scottish whisky production is worth around €6.5 billion to the British exchequer and, with a little Dutch courage, the industry is aiming to reach net-zero emissions in its operations by 2040, ten years ahead of the British government’s 2050 target.

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