Scotch whisky exports hit all-time high in 2019

Scotch whisky ended the decade on a high note, as 2019 proved to be the best year on record for its overseas exports, write Rupert Patrick & Leon Kuebler for WhiskyInvestDirect.

Official numbers from HMRC show that a total of £4.9bn worth of Scotch Whisky was exported last year, representing a total increase of 4.4% on 2018’s total of £4.7bn.

All in all, a total of 366.3m LPA (Litres of Pure Alcohol, industry standard unit of trade) were dispatched over the course of 2019 – equivalent to 1.3 billion bottles of Scotch, or 41 bottles every second. Compared to 2018, this was an increase of 2.4%.

These numbers are Scotch whisky’s best-ever export figures, both in terms money earned and spirit sent overseas; a fact which is all the more remarkable given that 2018 was the previous best year on record for both measures. It is also the third year in a row that Scotch has set a record for the total pound Sterling value of its overseas exports.

 

Single malt was the standout performer, reaching a global value of £1.5bn for the first time off the back of a fourth consecutive year of double-digit growth. Even more noteworthy was the overall growth in volumes after a stagnant 2018, with 2019’s shipments rising an impressive 13.3% on last year.

As a result, single malts now account for 30% of the total value of Scotch whisky exports, despite only representing 11% of the overall volumes shipped.

Other categories of Scotch performed well, too. Non-single-malt exports reached their highest-ever volume of 327.1m LPA, beating the previous record set in 2011; meanwhile, blends shipped in bottle reached a total value of £3.1bn, their highest return since 2013.

Exports to the European Union were also the best on record, with value growth of 5.5% leading to a total of £1,476m, edging the previous high of £1.451m in 2011. However, exports were unevenly distributed over the course of the year, as record numbers were seen in Q1 and Q3 prior to the March 31st and October 31st Brexit deadlines, before slowing down in Q2 and Q4 again.

Shipments to France, the largest consumer of Scotch whisky in the world, were down in both volume and value terms on 2018. But the other five EU countries in the top-20 most-valuable markets for Scotch saw increases in the value of exports of between 4.8% (Spain, 5th-most valuable) and 36% (Netherlands, now 12th most valuable).

For the first time this decade, there was a change in the top-two markets for Scotch whisky, as India became the second-largest consumer of Scotch, overtaking the United States.

India imported 36.6m LPA in 2019, growing 16.1% on 2018’s figure, which was 25.9% higher than the imports for 2017. Over the course of the decade 2010-2019, India’s imports have now tripled in volume and quadrupled in value, with its total Sterling expenditure of £166.2m now the 7th-highest in the world.

Other countries in Asia & Oceania also performed strongly, with the region growing 11.9% in volume and 9.8% in value. Exports to Asia & Oceania for 2019 were worth a total £1.238m – only £45.8m beneath those taking by North America, the second-most-valuable region.

The United States became the first market to reach £1bn in value in 2018, and it continues to remain the largest market by value, growing a further 2.8% year-on-year to a value of £1.069m. However, volumes were down 7% compared to 2018, as the impact of US tariffs on single malt Scotch whisky began to take hold.

Tariffs were imposed on October 18th 2019, and exports of all Scotch whisky to the United States in October-December were down 20.5% on the previous year; in the first three quarters, prior to the imposition of tariffs, volumes were stagnant, with a small drop of -0.7% compared to Q1-Q3 2018. Values over the

Outside the three major regions for Scotch, growth continued in Latin America & the Caribbean (+2.7% value, +4.6% volume) and Sub-Saharan Africa (+11.3% in value, +3.8% volume). Shipments to Brazil and South Africa, the largest markets in each region, experienced growth in both categories.

 

Rupert Patrick, CEO of WhiskyInvestDirect, commented:

"This new record for exports proves the importance of Scotch whisky for UK PLC. Despite the obvious headwinds, the industry continues to grow, showing how much Scotch is wanted and enjoyed the world over.

"At the same time, these figures underline the need for resolutions over Brexit and the US tariffs. Exports to the EU-27 rose 6% by value last year, while the United States became our first billion-Pound market.

"The Scotch whisky playing field continues to evolve, with sales of single malt performing strongly. Looking further ahead we may be seeing early signs of a strong revival for premium blended Scotch. Today's consumer is looking beyond mere labels, wanting flavour and character, as well as good value."

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