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Irish Whiskey Set For Major Expansion As Investment Soars

January 3, 2017

With the Irish whiskey category in high gear—easily crossing 3 million cases in the U.S. in 2016, according to Impact Databank—key spirits players have been investing heavily in new distillery operations on the Emerald Isle.

Back in the early 1980s, only two distilleries operated in Ireland (Midleton and Bushmills), both owned by Irish Distillers. In 1987 Cooley Distillery was added to the mix, bringing the number to three. Ireland now counts 16 distilleries in production, with 13 more in the construction or planning stages, according to the Irish Whiskey Association (IWA).

“This phase of major capital investment, worth an estimated $1.1 billion over 10 years, is in response to the world’s continued strong demand for Irish whiskey over the past 20 years,” says IWA chairman Bernard Walsh, who’s also managing director of Walsh Whiskey Distillery. “The increased capacity will enable Irish whiskey to satisfy existing demand and grow market share. It will also broaden the category through greater innovation and encourage whiskey tourism across Ireland. Tourism, in fact, has been a significant factor in the development of the successful Scotch whisky sector over the decades.”

Tullamore Dew, which has been rising by double-digits in the U.S. and is now above 200,000 cases, opened its $50 million state-of-the-art distillery three years ago, having previously sourced its whiskey from Midleton, Bushmills and Cooley. “This will be the first year that all whiskey used in the creation of Tullamore Dew—pot still, malt and grain—can be made at the Tullamore Dew distillery,” says Paige Parness, senior brand manager, U.S., Tullamore Dew at William Grant & Sons. “In the near future, we expect to see a number of new and interesting whiskies come into the category from an increasing number of distilleries.”

After breaking ground in 2015, Brown-Forman’s Slane Distillery in Ireland’s Boyne Valley is expected to begin production in April, with tours starting in the summer. The 18th-century Slane Castle sits on 1,500 acres 30 miles north of Dublin and will feature a visitor center and distillery with a capacity of about 600,000 cases. Brown-Forman intends to target its Slane whiskies toward the high end.

Walsh Whiskey, marketed by Palm Bay International in the U.S., last summer completed work on its new €25 million ($26m) distillery and visitor center at Ireland’s Royal Oak, County Carlow. The facility’s 650,000-case capacity allows for innovation in malt, grain and pot still whiskies on Walsh’s Writers Tears ($45) and The Irishman ($38-$150) brands, which combine for about 20,000 cases in the U.S. “With The Irishman range and Writers Tears, we need to start diversifying and giving consumers more choices,” says Walsh.

Jameson, Irish whiskey’s dominant player, also recently has been making new investments. Pernod Ricard earlier this year repurposed a warehouse at its Midleton distillery into a new micro-distillery dedicated to innovation and experimentation. Jameson’s visitor center in Dublin is also undergoing a renovation and update.

Meanwhile, Casa Cuervo has unveiled plans for a £30 million ($37m) expansion of its Bushmills distillery in County Antrim that will double its capacity. The Bushmills brand, marketed by Cuervo subsidiary Proximo Spirits, sells around 225,000 cases in the U.S. Additionally, Teeling Whiskey Co. (imported by Infinium Spirits) opened a new distillery last spring in Dublin’s Liberties section.

The 16 Irish whiskey distilleries currently operational are Walsh Whiskey Distillery; Midleton; Bushmills; Tullamore; Cooley; Kilbeggan; Dingle; Echlinville; The Shed; Connacht; Blackwater; West Cork; Teeling; Waterford; Rademon Estate; and Great Northern. Among the facilities now in development, Kentucky-based biotech company Alltech has begun construction on its new Pearse Lyons Distillery in Dublin (Alltech also produces whiskey in the U.S. at its Town Branch Distillery on the Kentucky Bourbon Trail), and Boann is currently finishing work on its €20 million ($21m) facility in the Boyne Valley. The Boann Distillery, with a capacity of 200,000 cases, also has a 50,000-square-foot craft brewery, whiskey bar, restaurant and taproom.

The latest issue of Whisky Advocate features a cover story on the Ireland’s distilling renaissance, and the Irish Whiskey Trail now features distilleries, visitor centers and pubs that welcome about 600,000 visitors annually. —Kimberly Tharel

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