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News : Irish Economy Last Updated: Mar 2, 2015 - 9:07 AM

Scotch whisky exports at £3.9bn; Irish whiskey exports at €365m
By Michael Hennigan, Finfacts founder and editor
Jan 30, 2015 - 6:14 AM

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Scotch whisky exports at £3.9bn (€5.2bn) compare with Irish whiskey exports at €365m in 2014, reflecting a dramatic reversal in fortunes for the Irish industry which had a golden period in the nineteenth century.

Monks first distilled whiskey in Ireland from the 6th century and the Irish 'uisce beatha' and Scottish Gaelic 'uisge beatha,' were derived from Latin aqua vitae, 'water of life,' as was eau de vie and akvavit or aquavit.

The English word whisky or whiskey, derived from the Gaelic, came into usage in the early 1700s and Irish distillers began using 'whiskey' in the nineteenth century to distinguish their product from Scotch.

This week the Scottish Whisky Association reported [pdf] exports grew from £1.9bn in 2002 to £3.9bn in 2013 - an increase of 111%. Earlier this month, Bord Bia, the Irish State agency, reported [pdf] that Irish whiskey exports have risen 60% since 2009 to €365m in 2014 despite a slowdown in its biggest market, the US. The agency said Irish whiskey made up 30% of total Irish beverage exports in 2014, and reported that the rise helped to offset slower beer, cream liqueur and cider sales.

Overall, drink exports are estimated to have increased marginally in 2014 to €1.21bn while total food and drink exports of  €10.5bn were at about 6% of total headline exports, dominated by foreign multinationals.

There are 10,900 direct jobs in the Scottish whisky industry and about 800 in its Irish counterpart.

Irish industry

The John Jameson Distillery on Bow Street, Dublin, was acquired in 1780 by John Jameson, a Scot, who had married into the Haig family, distillers of Scotch whisky. His son married into the Stein family, one of the biggest whisky distillers in Scotland and prior owners of the Dublin distillery.

Official duty data show that between 1797 and 1840, Irish spirit consumption was always higher than Scotland's and despite the difference in population, was higher than consumption in England and Wales in 23 of those 44 years.

In addition, according to a paper [pdf] by Dr Andy Bielenberg of the School of History, UCC, while Ireland had only 108 distilleries in 1827, there were 343 in Scotland and 13 in England, "indicating that the Irish industry was more heavily capitalised than in Scotland."

A key development for Irish distillers was the production of a still by Aeneas Coffey (1780-1852), who had been an inspector of customs in Dublin.  Patented in 1831, it was a modification of a Scottish still and was called the 'continuous, column, patent or Coffey still' -  see here.

The Irish Department of Agriculture and Food says that "between 1823 and 1900, the output of Ireland’s distilleries quadrupled. Dublin whiskey, with its six powerhouse distilleries, dominated the Irish and world stage, employing hundreds of workers with their own cooperages, stables, blacksmiths and carpenter shops and they exported around the globe."

By 1867, Midleton Distillery in County Cork, had the world’s largest still (a record that still stands today) with a capacity of 31,500 gallons.

After the Potato Famine deaths and emigration of the 1840s, the population fell through the rest of the century and Dr Bielenberg says that the rise in output in the last quarter was entirely due to exports.

By 1900 the John Jameson Distillery was reporting a net profit of £119,705.

Distilling was suspended in Ireland in 1917 because barley was required for the war effort.

The US had been the biggest export market for pot still Irish whiskey and Prohibition closed that market from 1920 while some bootleggers branded their poor produce "Irish whiskey."

After Irish independence, a civil war and the Depression, Prohibition was reversed in the US in 1933 but a trade war between the Irish Free State and the UK began.

Many Irish distillers had gone bust and in my home town of Bandon, the Allman distillery, which had opened in 1825 and at times employed about 400 people, closed in 1933.

The Scottish distillers were much better prepared for the reopened US market than their Irish counterparts.

The Department of Agriculture and Food says: "By 1953, there were only six distilleries on the island, mainly based on domestic demand. These were the Jameson and Powers distilleries in Dublin, Cork Distilleries Company (CDC) in Cork, Tullamore distillery in Offaly and the Bushmills and Coleraine distilleries in Northern Ireland.

By 1966, the number of distillers in Ireland had dropped to four. This became two as Jameson, Powers and Cork Distilleries merged to form Irish Distillers, then known as United Distillers of Ireland, and then finally in 1973 to one company when Bushmills merged into Irish Distillers. A new distillery was commissioned by Irish Distillers in Cork in 1975 to replace the Jameson, Powers and Midleton Distilleries which were all closed in the same year.

This marked the beginning of the revival [ ] In 1987, Cooley Distillery was established and was the first independent distillery to begin distilling in over 100 years."

A year later, Pernod Ricard acquired Irish Distillers and began to invest heavily in its Irish whiskey portfolio.

Since 1988 small distilleries have been opened and in 2013 more than 6.2m 9 litre cases were exported to over 100 countries - half the estimated peak export trade more than a century ago.

There are 109 Scottish distilleries and they export about 96m cases annually.

Focus on Irish food industry's bigger potential than chemicals or high tech

Benchmarking Irish food & drinks industry in 2015 - Part 1

Ireland: Only 3% of Irish SMEs are active in manufacturing - Part 2

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Ireland 2016: "Best small country in the world" for business? - a FAIL

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