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Scotch Whisky Association calls for government support over “trade barriers” as exports drop to 25-year low
This isn't just a hangover from the Scottish referendum.
Sales of Scotch whisky, one of the country's biggest and most emblematic exports, dropped 11 per cent in the first half of 2014, figures out today show.
Sales of the drink fell £220m to £1.77bn for the six months to the end of June – its biggest half-yearly decline in 25 years – as a result of “economic headwinds and uncertainty”.
China was one of the markets to show a big drop off, as part of the anti-corruption crackdown already affecting sales of luxury goods such as watches and cars.
Exports of Scotch to Singapore almost halved from £173.8m to £94m, while the US ordered 16 per cent less (by value), dropping to £327.7m, from £391m. Brazil and Mexico also saw declines.
The Scotch Whisky Association put all this down to “a mixture of reasons” including an economic slowdown and a stronger pound sterling.
“But in all these markets the whisky category remains popular and the long-term prospects are good,” the association added.
“Following a decade of fast growth, the demand for Scotch is levelling off in some markets,” it continued. “However, there is confidence in the long-term future of Scotch, with many projects for new distilleries under way, and up to £2bn of capital investment in Scotland committed by producers.”
Exports to some markets did grow. France is now the biggest market by volume, up 3 per cent to 86m bottles, and the second largest by value – up 2 per cent to £211m. The US is still the biggest single importer of the spirit.
Exports to the United Arab Emirates (UAE) were up 26% to £54m, with that area acting as a distribution hub for parts of Africa, Asia and India.
“Growth of 31% in the difficult Indian market is particularly welcome and shows the potential opportunities there,” the association said.
SWA chief executive David Frost said the figures showed “that the success of Scotch whisky can't be taken for granted”, adding that it highlighted the need for “support from government to beat down trade barriers and help us access new markets overseas”.
He continued:
That is why we are determined to play a full part in the forthcoming debate about further devolution, so that it enables a supportive business environment to ensure the future success of Scotch whisky.
Check out how sales of Scotch whisky have changed in the last year: