Scotch Whisky’s Export Dilemma: Navigating Declines and Seeking New Horizons
In the first half of 2023, Scotch whisky export volumes plummeted by 20%, while their value dipped by 3.6% compared to 2022, as reported by the Scotch Whisky Association (SWA).
2022 witnessed record-breaking Scotch whisky exports, with a 37% value surge, hitting a landmark £6.2bn, despite economic challenges. This was the first time the industry broke the £6 billion barrier.
However, the first half of 2023 painted a different picture. The value shrunk by 3.6%, equating to £2.57bn, while volumes dived by 20%, representing 630 million standard bottles.
Mark Kent, SWA’s chief, attributed the sharp volume decline to consumers opting for premium spirits and consuming less alcohol overall.
The US retained its position as the top Scotch export market in terms of value. Meanwhile, France surpassed India, becoming the largest volume export market for Scotch. Notably, even with significant growth, only 2% of the 2022 Indian whisky market was occupied by Scotch. Yet, in the first half of 2023, India imported an equivalent of 72 million Scotch bottles.
The SWA advocates for a UK-India trade deal, aiming to alleviate the hefty 150% Scotch tariff, envisioning a surge in Scotch exports to India, potentially exceeding £1bn within half a decade.
Furthermore, the association underscored the significance of the Scotch sector, especially after a recent 10.1% excise duty hike, which further distanced the tax disparity between spirits, beer, and cider.
Kent emphasized three focal areas: halting further autumn budget tax hikes, securing a trade deal with India that slashes the Scotch tariff, and crafting regulations that bolster the industry’s growth.
He implored the Government to acknowledge Scotch as an economically invaluable domestic product, emphasizing the industry’s need for robust backing.
