A Master Distiller once compared barrels to me as naughty children. None of them behave as you’d like them to and although you love them all, there will always be a few which are your favorite.

[Human finished barrels now available…dog not included]

Marketeers play on this with labels boasting ‘Distillers Selection’, ‘Select Oak’, ‘Masters Collection’, ‘Paradis’ or ‘Single Barrel’ etc. All buzz words used to sell a unique barrel reaction. But how many of these releases are truly picked for their unique character?

If you haven’t noticed yet, age statements are coming off bottles of scotch and despite what the brands will tell you, it’s a global shortage of stock driving the change and not quality standards. Global drinks giant Diageo (Johnny Walker, Talisker, Laphroaig, Caol Ila, Oban, Dalwhinnie, J&B Rare, Cragganmore, Glenkinchie, Singleton…) released a statement in 2012 committing a £1 billion investment into the development of their scotch range over a five-year period while Edrington Groups brand champion, The Macallan, are about to begin construction on a £100 million distillery upgrade in a bid to increase output and brand presence. In short, whisky is riding a global boom with the America and Asia / Pacific markets grabbing the biggest pieces of the pie. But at what cost?

[Image: Laphroaig PX Sherry Cask – Exclusive to Travel Retail]

They say around 70% percent of all flavour in a scotch or bourbon is a direct influence of the oak maturation. It’s a vague average to say the least with maturation rates variable on temperature, new oak vs old, cellar locations, oak varieties, stave curing rates and barrel volume to name a few majors. Maturation is like brewing a good cup of tea – there are many types of tea leaves, each infusing at different rates based on size, temperature, time and the overall flavour profile you wish to achieve. But also like tea, whiskey can be over-brewed.

For consumers however, age statements on labels are the definitive go-to gauge for quality and price whether rum, bourbon or scotch, whether accurate or not. In return for the removal of this guideline, the slogan ‘Maturity not Age’ is now becoming a mantra for all oak aged spirits with the barrel choice or oak finish the new gospel. As always, it’s Travel Retail (Duty Free) you need to look to for global trends. It’s here you’ll discover brands like Laphroaig testing new marks An Cuan Mor (ex cognac casks), QA (‘Quercus alba’, American White Oak), PX (Pedro Ximinez sherry casks). Glenrothes have also focused on oak variety with their new Robur (‘Quercas robur’, European Oak) while Auchentoshan have launched a run of five distinctive malts to discover “the story of cask maturation” using unique cooperage barrels, select heartwood stave’s and solera finishes. While it may be like learning a new language for consumers, it’s driven by the brands they know and trust.

From an industry point-of-view, the increased demand for scotch is also increasing the industries level of dependency on American whiskey distilleries to supply the vast majority of their ex bourbon barrels. Especially when many have to turn to a competitor for the cheapest supply of barrels.

[Image: The Macallan Sherry Cooper: Perfect Shots – by Albert Watson c/o Nowness.com]

A brief look back at the early days of scotch maturation and we see the sherry cask finishes we pay so much more today used to be the cheaper option due to a surplus of barrels. But back then scotch was still a small fish and the British drank sherry like it was gin. Today sherry is struggling, barrels are few and American oak is plenty. As such a distillery pays roughly 12-14 times the cost for an ex sherry butt compared to an ex bourbon barrel. Beam-Suntory group (The Macallan, Glenrothes, Famous Grouse, Highland Park, Laphroaig…) are well known to use sherry casks across the majority of their range with Macallan using it as part of their signature style. As such, the company have invested £15 million into the manufacture and supply of sherry butts to sustain their brand demand. They literally manufacture sherry just for the seasoning of their required barrels. And as there is no longer a big enough market to sell the liquid afterwards, much of it is sold off cheap for fortifying brandies or merely discarded.

The single largest supplier of ex bourbon barrels to the scotch market (granted it’s technically a Tennessee whiskey) is Jack Daniel’s. Having just opened a new USD$60 million super cooperage in Trinity, Alabama, Jack Daniel’s can now produce up to 700 barrels a day making brand giants like Diageo, quite literally in their pocket. Despite Jack Daniel’s sizable investment, American whiskey is also seeing demand outstretch supply and many large distilleries like Buffalo Trace, fighting to find ways to maintain supply. Luxury bourbon’s like George T. Stagg have been released in a younger Stagg Jr bottling so volumes can be maintained and even White Dog (unaged whiskey) is now being sold as a standalone product in an equal attempt to hold market supply.

[Image: Jack Daniel’s new ultra-modern cooperage facility, Trinity, Alabama. c/o madeinalabama.com]

In a global power play where whiskies from both sides of the Atlantic can lose millions at the beat of a butterfly’s wings, brand are always looking for ways in which to obtain or retain a winning edge. At the moment in the US, a series of court cases are raging between Diageo and Brown-Forman brands in regards to an alteration on the definition of a ‘Tennessee whiskey’. The primary element in debate by the Tennessee General Assembly is to allow distillers to reuse old barrels in the maturation process. The advantage to most distillers is a huge decrease in production costs which, as it stands, currently requires them to use only new American oak barrels.

While there are only six Tennessee whiskey distilleries in operation, Brown-Forman owned Jack Daniel’s stands as clear market (and barrel) leader while Diageo fight in distant second place with their competitor, George Dickel. It’s a big gun battle for market dominance but driven by a basic ruling which if swung, could pave the way for a relaxation in the bourbon industry too. The freedom for all American whiskies to re-use old barrels during maturation will release them from a current barrel shortage but in turn restrict availability and raise costs for the dependent scotch industry. While the future is hard to predict, scotch distilleries are already investing in ways to retain financial control in light of such a change.

The Whisky Exchange blog posted a brilliant April fools article this year that I confess got me all excited. They played on the above issue claiming a leaked letter by the Alcohol and Tobacco Tax and Trade Bureau (do they even exists?) allowing barrels for reuse across all American whiskies.

[Image: C/O – blog.thewhiskyexchange.com]

They went on to post an image of a northwest London car park used by Diageo to grow oak trees and how creative scotch brand Compass Box were experimenting with thousand litre plastic water containers lined with oak vineer. I know, should have clicked by then, even when they mentioned a new launch of their ‘London Bourbon’ made with a neutral base spirit infused with Bourbon-cream biscuits…I still missed it. The scary truth is, apart from my own inability to qualify as a super spy, these satirical suggestions are not far from fruition. And if you think distilleries the world over have not already given thought to these kind of crazy solutions…you’re more gullible than me.

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