The 2013 Half-Yearly Single Malt Report (Part II)

Single Barrels

No segment of the single malt industry has been more impacted by the upswing in popularity than the single cask business. What was once a unique way for a handful of independent producers to make some cash on the side suddenly became the premier way to find great whisky at a great price. Older casks of Laphroaig, rare malts like Brora and Banff, cask strength versions from producers regularly unavailable, were all on the shelf for the consumer who wanted to branch out and diverge from the regularly-schedulded branded options. The blended whisky business had seen producers and blending houses swap barrels regularly for years, resulting in numerous warehouses all over the country filled to the brim with different whiskies from different distilleries. The only problem was that these bottlers were dependent upon other producers for their supply. When the distilleries started to worry about their own rations, the well began to dry up and many independent bottlers began scrambling just to keep up with their own demand.

One thing you have to understand, however, is the reason there were so many older, ancient, rare, and delicious single malt casks available is because no one was drinking single malt whisky. So there it sat, getting older, waiting for a day when it might find some use. I remember Stewart Laing telling us last year that they would have had several casks of 30 year Brora to sell, but they had already dumped most of it into their twelve year old blended brand about a decade ago. "We didn't know what else to do with it," he said, like a kid apologizing to his parents. "Obviously, had we known there was going to be a ressurgence for this stuff we would have sat on it, but we had already been sitting on it for twenty years!" Once the hobby of cask hunting began to really take off at the end of the 2000s, warehouses were being emptied faster than they could be refilled and the selection really started to dwindle.

Over the last six months, I've had many a single malt collector say to me, due to the recent price hikes for single barrel malts, "I'm done buying whisky for now. I'm just going to drink what I have." In a sense, that's what many independents like Chieftain's, Duncan Taylor, and Gordon & MacPhail are doing as well – they're looking at the current market and deciding that the price for new casks is simply too far out of whack. They're circling the wagons and focusing on their own labels and distilleries. Ian McCleod is far more interested in Tamdhu and Glengoyne than Chieftain's. G&M is steadily pushing Benromach over new independent bottlings. A.D. Rattray has a big development currently in the works, while Douglas Laing expects to make a bid for their own distillery sometime soon. Basically, these guys are all looking for ways out of the independent cask trade and into the production side of the business. They don't have enough casks to sell anymore, so they're not in any hurry to be rid of them. Since they're not in any hurry to sell, they're certainly not in any hurry to deal.

If you're wondering why our selection of single barrel single malt whisky has diminished over the past year, this is the main reason: price. David and I are not buyers who will simply buy things because we know they'll sell. We could buy a case of practically every single cask whisky that comes our way and someone would eventually buy it all – that's the great thing about the internet these days. However, neither of us wants to see a shelf with $150 bottles of Laphroaig 15 or $200 bottles of Ardbeg 12. That makes us part of the problem rather than part of the solution. We've also passed on many selections over the past six months because we have the capability of doing our own importation now, leading to much fairer pricing for consumers. The only problem is that the process of bringing whisky over the Atlantic is a long and arduous one, so there tend to be serious holes in our inventory while we wait for the newest batches to arrive.

While I do expect prices for standard single malt releases and older expressions to eventually level out over the next year, I don't forsee a future where old, rare, and interesting single casks re-emerge on the shelf. The spoils of the last decade were based on the serious glut of overproduction in the 1980s. No one ever set out to create 35 year old barrels of Banff, or a small collection of Ladyburn casks. It happened because no one wanted to buy these whiskies. With the demand of single malt whisky where it is today, however, we're not likely to see this segment of the market ever return to where it once was – at least not anytime soon. We're still able to find some great values from Signatory and a few newer bottlers that have popped up recently, but nothing like we once did only a few years ago. David and I simply scratched our heads at some of the cask pricing we saw this year.

It's going to take another glut to ever produce the circumstances necessary for serious, affordable, single cask selection. Plus another few decades of disinterested consumers to allow all of it to mature. Only when distilleries overproduce do they start shedding barrels, but most are still playing catch-up.

In other words, don't wait around.

-David Driscoll


The 2013 Half-Yearly Single Malt Report (Part I)

We're half way through 2013 and it's been a frustrating year for a number of whisk(e)y drinkers, mainly because the availability of mature releases has become increasingly scarce, while prices for the usual suspects have gone up, up, up. We've written a number of posts about this subject over the last few years and I've received a healthy dose of customer rants. Many longtime drinkers simply feel like they're getting less and paying more, especially for new marketing and gimmickry. While I can't really argue against that mindset, nor do I necessarily disagree with it, I'm not going to "continually look in the rear-view mirror," as one of my emailers wrote. There's still a lot of good whisk(e)y to drink out there if you can get your mind out of 2009. You can't get Yamazaki 18 for $99.99 anymore, just like you can't get Chateau Lafite for under $500 or a house in the Bay Area for less than $500,000. We know that.

The question is: what can you get without overpaying? Plenty.

Young Whisky

Not all whiskies are created equally. Americans more than any other consumer, however, are still easily swayed by age statements, numbers, points, and ratings more so than their own judgement. Nothing confuses more K&L shoppers than the gulf in price point separating the Lagavulin 16 from the 12 year ($64.99 vs. $99.99). "This doesn't make any sense," they say. "Why is the 12 year thrity-five dollars more when it's four years younger?" Many reasons, as we all know, but mostly because the 12 year isn't simply the exact same whisky with four less years in the barrel. Yet, we continue to compare young whiskies versus their older brethren, cursing the rising cost of youth without perhaps stopping to think about whether the quality has risen with it.

For example, is ten year old Bruichladdich spirit, made entirely after the re-opening in 2001, of the same quality as the older, inherited whisky they first released? Not according to Jim McEwan.

"About five weeks ago I checked our present ten year old and twelve year old against what was available before we bought the distillery in 2001, which was a ten year old and a fifteen year old, and the difference was huge. The old stuff was lacking in almost all areas, particularly in the oak department. The whisky was lacking in oak influence and the fruits of distillation were very muted and there was no finish to speak of - it was gone after fifteen minutes," Jim told me yesterday via email. "Now the problem really came to light on my first few weeks here, when every cask was a second or third fill, even fourth fill and so I set about recasking every single barrel  in the warehouses into fresh Bourbon and fresh Sherry. That took three years due to the lack of cash, but I got it done and you know that I have only used the best available since I started at Bruichladdich."

It's no surprise that the initial Bruichladdich releases after the ressurection were finished in all kinds of different wine casks, hoping to add some pop to the dullness of old wood maturation. "Crap wood gives little or no
flavour from the cask,"
Jim added, "so instead of improving the spirit, the wood is like a parasite and it sucks the life from the spirit. Of course, (a little caramel) fixes that in terms of colour and sweetness, but that's like make-up on a ugly woman, the final nail in the coffin." This is something to keep in mind when you think back to 2007 and the $50 Bruichladdich 12 year that you once loved. Today's 10 year release is far superior, both in my mind and in Jim's. Not only because of the increased quality of Bruichladdich's maturation program, but also the flavor of the distillate itself.

Bruichladdich's Bare Barley release is one of the best of 2013No whisky has impressed me more so far in 2013 than Bruichladdich's Bere Barley release, a six year old release made from a different strain of barley (perhaps brought to Scotland by Norse invaders sometime around 800 A.D.) than their usual single malt whisky. Again, some customers scoffed at the $70 asking price for a malt so young, despite the fact that the quality was absolutely stunning. When something tastes this good and is made with such care, isn't it worth shelling out the extra money? "The Bere Barley is so young and pure, no make-up just as nature intended. Its history, honesty, and harmony honor the guys working on a dream which the consumer can experience, the wonder of how the seed survived since the 9th century, brought by Vikings to Scotland. What a living timeline!" Jim wrote in a separate email last February. When we think about whisky today as consumers we need to consider what steps distillers are taking to justify the new market pricing. Is your favorite whisky pushing the limits, working hard to bring you something new and exciting? In my mind, Bruichladdich is truly beginning to stand tall above the top its Scottish competitors, in terms of quality, value, and design. Their Botanist gin continues to be one of my favorite mixers and the Port Charlotte 10 year might be my favorite peated whisky of 2013 thus far.

Can six years really taste better than sixteen? We think so.Don't forget Kilchoman, either. Most single malt fans have learned that the farm distillery's penchant for smaller heart cuts and slow distillation times is resulting in some of the finest peated whisky in the business. Their newest release, 2013's sherry-matured Loch Gorm, is already testing the patience of many consumers with its $79.99 price tag, despite its six year age statement. Everything explodes, however, on the first sip - supple sherry, iodine and peat, rich barley, and campfire smoke. Just to make sure I wasn't overly-excited by my own personal bias, I decided to open it next to a bottle of the Lagavulin 16 - a whisky that has recently taken a qualitative nosedive, in my opinion. There was no question concerning which whisky was the more impressive specimen. The Lagavulin tasted muted, watered-down, just flat out boring when paired next to the provocative and poignant Kilchoman. The Redwood City staff came away confounded, but as McEwan already pointed out, the number doesn't tell you anything about the condition of the barrels.

-David Driscoll


Applejack of All Trades

Have you ever heard the phrase, "Jack of all trades, master of none"? That's me. In high school, I was good enough to make the baseball team, soccer team, water polo team, tennis team, and football team, but I was never talented enough to actually make it into a game. I would sit on the bench, knowing that I was a part of the group, but that's about all the playing I ever did.

In the realm of home cocktail mixing, I feel like many people apply this same type of broad, sweeping discipline – one that briefly touches on a number of things without any true mastership. We make a drink, try it out, and then move on to something else, when we would perhaps be better served by taking one or two classic cocktails and focusing on doing them right, tweaking them, experimenting, and ultimately finessing their creation. That's what our friend David A. Embury believed, the opinionated author of The Fine Art of Mixing Drinks. He once wrote:

The average host, who makes no pretense of being an expert on liquors, can get along very nicely with a knowledge of how to mix a half dozen good cocktails. In fact, if he can make only two or three and always makes them well he will stand much higher in the regard of his guests than will the indiscriminate chop-suey dispenser who throws together a little of everything that chances to be laying around loose with no regard whatsoever for the basic function to be performed by each ingredient.

That sounds like the old me – never wanting to take the time to learn how to do something well, just wanting to know enough to say that I can. However, one day I decided that the old me was kind of an incompetent mess who was in need of a little discipline. I decided to master the six cocktails on Embry's list and learn how each component functioned in the mix. Once understanding the formulae, I would be able to mix and match ingredients to create a number of spin-offs and plays on the old hits.

Embry lists the Martini, Manhattan, Old-Fashioned, Daiquiri, Sidecar, and Jack Rose as his basic six. However, since we all know how to make a Martini, and I don't feel like drinking sweet Bourbon when it's 100 degrees outside, let's scrap those two for today. We've already covered the Daiquiri in the past with a super three-part post, so let's scratch that. How about a Jack Rose? When's the last time you made one of those?

Embry writes: "...the principal reason that apple brandy has not gained a greater favor with the drinking public is the fact that is is sold well before it is well aged. I venture to say that if some enterprising distiller would put out an apple brandy made with the same loving care as Cognac and aged in wood for ten, twenty, or even forty years, it would soon rival grape brandies in popularity, especially for use in mixed drinks.

Unfortunately, Mr. Embury, we've now reached that stage in the booze business where great Calvados is available around the world, but it hasn't tempted the general public to the level with which you once predicted. Nevertheless, great apple brandy cocktails are definitely overlooked, especially the Jack Rose. How does once make a Jack Rose, though?

David A. Embury's Jack Rose De Luxe

1 part Grenadine (1/4 oz)

2 parts Lemon Juice (1/2 oz)

8 parts Apple Brandy (2 oz)

Shake vigorously with plenty of cracked or crushed ice and strain into chilled cocktail glasses. A twist of lemon may also be used and the peel dropped into the glass if desired.

The great part about mastering the Jack Rose cocktail, or any cocktail, is that you can learn what you do and don't like about it. You may simply discover that you want to use cherry liqueur instead of grenadine, or lime juice instead of lemon juice. Personally, I like doing it the way they do at the Slanted Door in San Francisco, by adding a bit of simple syrup and absinthe into the mix.

David's Jack Rose Adaptation (play on the Pan-American Clipper by Erik Adkins)

2 oz. Apple Brandy (Lemorton Reserve Calvados)

1/2 oz. Small Hand Foods Grenadine

1/2 oz. lime juice

1/4. oz. simple syrup

dash of absinthe

Pour ingredients into a cocktail shaker, shake vigorously with plenty of ice, double strain into a glass.

Now it's time to sit outside on the patio, eat my lunch, and read my book.

-David Driscoll


Dealing with Demand, Role Reversal

I feel like we handle most customer service aspects at K&L quite well, mainly because everyone who works here truly cares for both wine and people. It's not just another nine-to-five job for us. I'm also very pleased at how the blog has helped explain and clarify many of the industry's current trends and tumbles to those who shop here. I've always found that managing expectations is the best way to prevent disappointment. Therefore, if we know that price increases are coming or that a particular product is going out of commission, it's best to present these issues quickly and clearly to give customers advance notice.

One aspect of retail customer service I'm still not sure how to deal with, however, is the allocation of limited edition spirits to our loyal consumer base. Simply put: we've got more customers than bottles for many of the newest single malt and American whiskey releases. We've tried a number of different ideas for how best to distribute these items fairly, but they all end with a  number of unhappy people who inevitably miss out. Not having enough product is frustrating for us as retailers because we're used to brands catering to us, not the other way around. I hear stories all the time about spirits buyers or bar managers freaking out on their sales reps because they can't get more Four Roses 2013 Single Barrel or an extra case of Black Maple Hill. In this scenario, the roles are reversed, because the brand doesn't need you when their special releases come around, but rather we need them. Sometimes when the shoe is on the other foot it can lead to a serious level of discomfort.

So what's the best way to deal with the current state of whiskey demand? If anyone is aware of the prevalent frustration among consumers, it's me. I get hundreds of emails every day, talk to countless people on the sales floor, and read the blogosphere as much as I possibly can. I'm also ground zero for customer complaints when a certain bottle sells out just a little too quickly. No matter what method we choose there will always be a percentage of customers inconvenienced by the procedure, so we try to simply go with the most utilitarian option. Demand outstripping supply is nothing new in the booze industry, however. Many budding whiskey fans may feel like their current situation is unique and unfair, but it's been happening for decades in the wine trade. With Bordeaux, the job of handling allocations is actually outsourced.

For as long as K&L has been in the wine business we've been dealing with the Bordelais and their negotiants who act as middlemen on their behalf. Like most limited edition whiskey distribution in America, your allocation of limited wine is completely dependent upon how much business you do with the Chateau. It can take years to get into the Bordeaux business, mainly because you have to pay your dues and build up your reputation as a player. Everyone in this game has money, so it's not merely based on your ability to pay. It's based on your history and who you know. Unlike whiskey, however, there are good vintages and bad vintages with wine, making one's loyalty to the supplier quite significant. In order to maintain your access you're expected to buy both in good vintages and in bad. If you're just some cherry picker who drops by to grab a few 2009 first growths, but stays away during 2011 when times get tough, what good are you for their business? No one needs help selling the easy stuff.

The same situation could be said for the retailer/customer relationship. When we get bottles like Pappy Van Winkle or Port Ellen 10th Edition, it's not the customer who's doing us the favor by purchasing them. It's us doing the customer the favor by allowing them to purchase. This is a complete role reversal for most consumers, who are usually in the driver's seat with the option to take their business elsewhere. Sometimes this can make people very upset, simply because they're not used to being in this situation. They come down to give us their hard-earned money and we tell them they can't have the bottle? "Is my money not as good as the next guy's?" Customers are used to feeling special, but in this situation they're simply one of many customers with the same need.

While there are no good vintages and bad vintages for whiskey, there are gluts and shortages. Because whiskey has to be made so far in advance, producers must project their level of production based on the estimated future demand. If they make too much then prices fall and they lose money. If they make too little, they miss out on potential sales, and they lose money. Ultimately, despite the safety from vintage variation, there are still good times and bad times for whiskey producers and distributors. Therefore, before they decide which retailers or restaurants to release their limited edition products to, they want to know that you'll be a solid partner for their other offerings. How much Eagle Rare, Buffalo Trace, and Rain vodka did you sell? We know you want the Pappy and the Sazerac, but how loyal have you been to the brand as a whole?

While we don't necessarily operate in the same fashion (yet), the same situation could be fairly applied to retail purchasing at K&L. Do you only stop by the store when we've got something hot, or do you shop here regularly? What type of profile history do you have? How long have you been shopping with us? These are all questions that are asked of us when we set out to secure limited allocations of hard-to-find products. I've always avoided taking this approach with the spirits department, mainly because I want to make newcomers feel welcome, rather than appear like some stodgy boy's club. We currently employ a raffle system that treats all customers fairly regardless of how often they shop here. But is that really the fairest way? What about all the guys who shop here practically every day?

It's a dilemma, no doubt, but it's not one we're unfamiliar with. In the late 1980s we could buy as much Caymus Cabernet as we wanted. Then, all of a sudden, the winery's popularity exploded and K&L was put on allocation. Total role reversal. It started with Caymus begging us to sell their wine, but ended with us begging Caymus for more to sell. That made our domestic wine buyers at the time very upset, but that's to be expected when you're used to having your ego stroked and your behind kissed. Retailer buyers like myself are used to being coddled and cared for. When they actually have to wait in line, do some work, or pay some dues it can make them very unhappy.

-David Driscoll


La Vida Loca

When I first tasted through my samples of Dulce Vida 100 proof tequila, I was not impressed. The supplier had stopped by to let me know about the new arrival, left me some 50ml sample-sized bottles to try out, and hoped I would call with an order later that afternoon. I never made the call. When he checked back in later that week to get my opinion, I told him I wasn't a huge fan of the spirit. It was all heat and no finish. My sales rep was totally flummoxed. Everyone seemed to think the new Dulce Vida tequilas were out of this world except me. What was the issue?

It turns out that the sample bottles I had been left were from an older batch - a test run. My guy asked if he could come back again with fresh, full-sized bottles and have me try them over. "Sure, why not?" I said. It turns out there was a difference in the two batches. A huge difference. The spirits in the mini bottles tasted like more subpar, unexciting, flash-in-the-pan, upstart tequila that I would not be interested in carrying. The tequilas in the full-sized bottles were flavorful, vibrant, full-of-life, and clean.

I was happy to place an order after such a turnaround.

Dulce Vida is another American brand, like our friends at Campeon, that has decided to contract tequila out of Jalisco according to their specifications. The spirit is distilled at NOM 1443 - Grupo Industrial Tequilero - a facility that makes a number of different brands, Don Pilar being the one most K&L customers would be familiar with. According to the supplier, Dulce Vida is sourcing their own Highland-sourced, organic agave for distillation and making sure the spirit has absolutely zero additives. The higher standards definitely result in a higher quality of tequila. I was afraid the 100 proof level would destroy the nuance of the spirit, but it actually doesn't. The spice and the fruit still come through in all three expressions.

All three are price at ArteNOM levels and provide a refreshing alternative for those looking to try something new.

Dulce Vida Blanco Tequila $39.99 - White pepper, baking spices, citrus, and lots of power. This is for those who like it spicy instead of smooth.

Dulce Vida Reposado Tequila $45.99 - Cinnamon, cloves, vanilla and spice cake intermingling with black pepper on the finish. Robust and flavorful.

Dulce Vida Anejo Tequila $49.99 - Just the right amount of wood without any of the caramel or toffee that infiltrate some of the more "adulterated" anejo tequilas. This has nuance and character in addition to extra richness.

-David Driscoll