Some of you aren’t going to enjoy reading this. You’ve already made your mind up – there’s nothing I can say that will convince you. It’s just a fact. It has to happen eventually. It can’t keep going on like this…..can it?!? Well friends, as dogged and determinedly minded as some of you are, for all the talk of the impending collapse, of prices having to hit reverse, the situation to my mind looks virtually unchanged as it did 10 years ago. Actually, that’s disingenuous – it’s worse. Over the last 10 years I’ve seen countless articles (some with well rationed economic analyses) highlighting the inevitability of the beginning of the end – the bursting of the whisky bubble. And yet, a decade later, nothing remotely close to this has happened. Prices have not fallen, we’ve not all miraculously re-emerged into a cheaper whisky utopia. Today it’s high time we burst some bubbles of our own and I’m sorry to say it, but I believe there might not even be a whisky bubble…..
There’s a good number of well understood reasons why we could be in a whisky bubble. Briefly: there’s certainly plenty of investment displacement – there’s a *lot* of money to be made from whisky presently and we are seeing some pretty rampant speculation. I think it’s reasonable to suggest that not everyone is going to be sat on a beach earning twenty percent – some folks are going to get their fingers burnt – likely the greedy ones who don’t do their homework properly. Similarly, there’s a considerable amount of ‘boom-like’ behaviour – not just from speculators, but from enthusiasts. The general interest in whisky is as widespread and as eager as I’ve ever seen it during my lifetime. As such, the number of new entrants is at an all-time high (I just wish some of them would put in the groundwork before opening up their blogs and vblogs!).
And overall these things are good news to my mind – more investment and more interest in whisky is great thing for the sector. But, at the same time, it presents increasing competition for products and an increasing demand on what is, by its very nature, a limited supply. Are all these people still going to be making the same demands on the whisky industry forever? If and when they move on, and that demand is removed from the system, is the supply is still going to be there? Surely that’s too much liquid and we’re building a new whisky loch? Certainly, supply is increasing at a pace (to meet demand) – a raft of distilleries have increased their production capacity to meet the market’s needs, and we’re witnessing an unprecedented number of new distilleries opening. I’d posit that not all of them will survive. Either through poor business management, or through the market naturally deciding on the LPA of 3 year old whisky it wants to stomach. But, that's far from the same as a wholesale collapse.
There’s certainly a sense of market euphoria around whisky currently – the media are pitching the liquid as a better investment than gold (which to my mind hasn’t been a great investment for years – merely a relatively safe and stable option over the longer time). Regardless, we’ve seen asset prices skyrocket over the last decade – and the level of elasticity of some brands/products still blows my mind. Indeed, it’s the secondary market which has driven much of the recent price escalation – in turn, producers seeing that the price elasticity of their products is substantially larger than their original RRP and re-positioning to try to take a slice of this market. And they’ve been canny about it – recognising that much of the hot and sweaty growth is in the limited edition, collectible and rare corners of the market. So, surprise of surprises, there’s much more limited edition, collectible and rare whisky on the market – funny that. It’s as if the producers know what they’re doing to relieve us of our hard-earned cash.
But, there’s a fundamental difference between a rapidly growing and evolving market and one where the floor is about to fall out. For all the talk of bubbles bursting and of prices collapsing, part of me can’t help feeling like much of this is driven by wishful thinking. A good number of you reading this post were likely not into whisky 10 year ago – indeed, I’m going to guess that some of you were not even of drinking age! Whilst I completely have sympathy for the position that prices have become ludicrous (because they have) I’d posit that it’s pretty unrealistic to be expecting the market to crash back down to levels where pricing was at a lower point than before you got into whisky. Sure, we’d all like to go back to 1990s pricing levels….but honestly I think that's highly unlikely. Price elasticity is certainly a ‘thing’ – but it’s my opinion that whilst the rubber band is continuing to be stretched, that is more likely for it to simply contract a little, rather than entirely snap. Price levelling, rectification and 'new normal' feel to me much more realistic than a wholesale bursting of the bubble.
A lot of credence is given to ‘bubble theory’ simply because the Scotch whisky industry has been there before. Too much whisky, too little demand = pop. But I’m going to argue that this time around everything is different – the world is a fundamentally different place, as are consumers – even whisky itself as an industry is completely changed from the time of the last collapse nearly 40 years ago.
Some of you are old enough to remember when our media consumption was driven by four TV channels and newspapers alone. Our exposure to products and to brands was incredible limited – we thought what we thought and we believed what we believed – driven generally by the views of our families and that of the media which we consumed. That’s not the world today – the Internet has completely altered the face of our media consumption and challenged the structure of how societal views are formed and held. The reach of whisky is immeasurable larger than it was 40 years ago – what was once the purview of pubs, magazine ads and billboards now reaches into the living room and onto the screens of our devices. Let’s be quite clear here – whisky’s current boom and growth has, in large part been driven by the digital revolution.
Technology has given whisky the ability to reach a vast number of people. As such, its appeal is as big and as wide as I’ve known it – new entrants, new markets, new distilleries – all driven by swathes of people continued exposure to whisky-related messaging – be that from distilleries, bottlers, or simply us enthusiasts. Whisky is in the spotlight – it’s no longer as niche as it once was. And education levels are rising. People simply know more, and have access to more information than they ever did – an empowered and knowledgeable consumer is not the mark of a bubble, it’s the mark of a sector which is only just starting to find a new level maturity.
Where and when did you get into whisky? As above, I’ll posit that a fair few of your came into the world through what you read and saw online – 40 years ago, this sort of exposure was impossible. Now, you can explore much whisky world without ever leaving the relatively comfort of your computer screen – there’s a terrifying thought for you. People need to get out more - but that's another story for another day.
The market is completely different to the time of the last collapse. What was once purely a consumable market is increasingly becoming a collectable market. That entirely changes the economic realities. Collecting whisky was not what caused the market contraction of the early 80s – to judge its effect on the future state of the industry we’ll just have to wait and see. But again, there’s that diversity – different strokes for different folks – all underpinning the strength of the sector and likely helping to add further protection to it to assist with weathering any upcoming storm.
It’s important to not look at whisky (in market terms) as a single monolithic whole. It has become much broader. And whilst the individual parts of the market are, of course, inherently linked, they have their own consumers and their own economics. Hence why, the largest price growth can be seen at the top end of the market – the ultra-collectible, the ultra-premium. Not at the entry level point. To say that the price of whisky has been rising, its undoubtedly true – but it’s important to note *where* it is rising. Entry-level ‘supermarket whisky’ is not showing the same level of price rises as the wider market – quite deliberately so. It would be a mistake for the industry to overprice its gateway drug. Similarly, whisky needs to be thought of in bulk – those 6 bottles of £50K whisky – might sound like an important thing, but in income terms they’re insignificant when compared to the millions of cases of £40 bulk single malt. And that’s saying nothing of blended whisky.
It’s all too easy for us enthusiasts get stuck in our own bubble – of thinking that our corner of the whisky world is representative of the whole. It honestly isn’t. We see the price of niche single malts and well-regarded blends steadily rising to unprecedented levels, but our immediate thoughts are largely selfish – to either note how we can have a piece of that action, or to deny its existence by suggesting that its a blip and is unsustainable. And yet, when you look outside of our bubble – all signs point to strong growth – expansion globally, new markets, record export sales year after year. We’re a decade on and still the march continues. This doesn’t sound like a bubble to me.
When you take a look at the enthusiast corner of the world, there are few signs of this supposed bubble. Whilst one month here and one month there, some prices might dip, the general trend isn’t close to midnight and a wholesale collapse. Secondary market prices are still entirely batshit – when someone is still prepared to pay several thousand for a bottle that cost under £200 just days before, we’re not holding a needle to the balloon. Not even close.
Moving to today’s review, and we’re heading to a distillery, who for the most part have avoided getting caught up in rampant speculation and expansion of the market. Glenfarclas is a distillery who pitched much of their age-statement core range bottling at an accessible level. In some cases truly showing how much of a premium other distilleries are charging for what is, in effect the same time – process wise at least.
2019 saw the distillery produce several special edition 25 year old releases – several of which passed my tasting table. A limited release for SWA to make their 100th auction and most recently, a 20th anniversary bottling for The Whisky Exchange. The TWE 25 year old comes by-lined with ‘The London Edition’ – a design cue which sees the label pay homage to London’s hospitality sector. The release has been solely matured in what should be seen as the distillery’s signature cask choice – oloroso sherry. It can be purchased for £150 directly from The Whisky Exchange or as a 5cl miniature for £25. Both (but particularly the miniature) are more expensive than the distillery’s OB 25 year old – however they’re not quite identical –the ABV here is upped from the 43% of the OB to 50.5% not just more ‘bang for your buck’ – but for a different experience in terms of both mouthfeel and flavour density. Also potentially of note is the Family Cask box as shown on their website – apparently they’ve got a few of these leftover (from something or the other) so rather than a cardboard box, at least for the time being they’re distributing these anniversary 25 year olds with a wooden box.
Nose: Bright and vibrant fruits – cranberry, raspberry and orange peels sit alongside chocolate sponge cake, a large pile of raisins and overt fresh oloroso sherry. Chocolate covered digestive biscuits are joined by well-lacquered oak tables, whilst ‘green’ hot house vines and malt brown bread sit with perfumed notes of Turkish delight, sunflowers and freshly pressed clean cotton sheets. The addition of water reveals further vegetal aromas – ferns and mossiness – together with golden syrup and coffee beans.
Taste: Opening with plump oloroso sherry influence – raisins, fig rolls and burnt caramel. Then, developing towards coffee and walnut cake – spongy and rich. Orange peels and liqueurs add sweetness and sharpness, whilst the back palate offers up both earthiness and rich brandy-soaked Christmas pudding. Reduction expresses wood polish and longer maturation whilst also really upping the nuttiness, with additional walnut joined by hazelnuts and enriched with a velvety chocolate sauce.
Finish: Medium to long in length with red berries and dried earth given tartness from a scattering of red apple peels.
This TWE exclusive Glenfarclas focusses on fresh, crisp and clean flavours as opposed to simply shovelling on the sherry. As such, its composition feels in turn with the underlying spirit – offering more nuance than just sticky sweet sugars and overt sherry. In that regard it’s somewhat ‘old school’ – not a sherrybomb and yet undeniably entirely influenced by its 25 years in oloroso. Regardless, its delicious and certainly recommended.
Review sample provided by The Whisky Exchange.