Positive signs for Scotch exports
06 Nov 2015
Return to growth on horizon
There is now clear evidence that the recent decline in Scotch
Whisky is slowing, with industry exports in the first half of the
year totalling £1.7 billion.
Encouraging trends are starting to develop in several key
markets despite continuing economic headwinds, political
uncertainty in some parts of the world, and the impact of a
stronger pound sterling in many areas.
Looking ahead, there are signs of improvement, with the 3%
decline in the value of Scotch
Whisky exports in first six months of 2015 being smaller than
the fall of 11% between the first half of 2013 and 2014.
Premium blends and Single Malt Scotch Whisky continue to become
ever more popular. Single Malt exports were up 5% to £406m in the
first half of this year.
Overall, the volume of exports was down by half of last year's
decline, falling just under 3% to the equivalent of 517 million
- In North America, exports to the USA, the biggest market by
value for Scotch Whisky, remained steady at £327m. Single Malts and
premium blends are doing particularly well as consumers seek out
quality. In Canada, the same trends drove an increase of 20% to
- In the other North American Free Trade Agreement (NAFTA)
market, Mexico, exports were also up by almost 12% to £43m. This
makes it a top ten market for Scotch, which is becoming
increasingly popular among younger, fashionable consumers.The value
of Single Malt exports soared by more than 70% to £3.6m. If a
refreshed European Union-Mexico Free Trade Agreement (FTA) can be
agreed, the prospects for growth will be even stronger.
- Despite the well-documented austerity measures in China, the
market returned to growth with direct exports jumping 46% to £22m
in the first half of the year. This principally reflects the strong
efforts made to export bottled Blended Scotch, up 42%.
- Exports to Japan are up 7.2% to £35m. After many years of
decline, it is exciting to see the market grow again on the back of
renewed interest in whisky. The increased interest in heritage
among whisky consumers is benefiting Scotch.
In other markets the trading environment is more volatile. In
Europe, France and Spain were up in volume but down in value.
Germany was down in both value and volume, but some of this is
likely to reflect a fall in re-exports to Russia. Brighter spots
were Poland, up 45% in value to £20m, Turkey, up 28% to £23m, and
Italy, up marginally after years of decline.
Outside Europe, the Brazilian market was badly hit, down nearly
30% in value because of the severe economic downturn and consequent
weakening of the Real by a third since the start of the year.
Sanctions and economic developments in Russia have knocked it out
of the top 20 markets altogether.
Finally, exports to India fell 11% by value and 8% by volume,
reflecting ongoing difficulties in the business climate, though
India remains the fourth biggest market by volume. A
resumption and conclusion of the Free Trade Agreement negotiations
is needed if sustained export growth is to take place in India.
David Frost, Scotch Whisky Association chief executive, said:
"We're starting to see some strong signals for growth and we
continue to believe the long-term prospects for Scotch Whisky
remain good. This is reflected in the large number of new
distilleries opening, with half a dozen starting production in the
last year or so.
"The growth of Single Malt exports shows that premium products
are ever more popular. We had a decade of record growth,
there was then a decline in exports in recent years largely because
of the slowdown in the emerging markets, but signs of improvement
are on the horizon.
"We will continue to push for more open access to markets by
pressing for the removal of barriers such as high tariffs and
unfair levels of taxation. Scotch needs a level playing field, in
the UK and overseas, to continue to be a Scottish and British
Notes to editors
The source of the figures is Her Majesty's Revenue and Customs
(HMRC). The figures are direct exports based on the value and
volume of product released from bond.
A table of top 20 overseas markets for Scotch Whisky by value and
volume is attached.
Rosemary Gallagher, SWA head of communications, 0131 222
9230/07432 605385 or email email@example.com
David Williamson, SWA public affairs and communications director,
0131 222 9226/07730 496151 or firstname.lastname@example.org