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Whisky Investment the Future

The world’s lust for luxury goods has never been stronger when seeing nations like India and China and their palate for the finest wines; it is apparent that the same is happening with Whisky. China has had a particular fondness for Wine from the Bordeaux region of France, and likewise, these emerging nations have developed a taste for Scotch Whisky. Along with the USD 1 Billion Scotch Whisky Market in the United States, Scotch will be challenging China for a share of its soon to be USD 3 Billion Whisky industry.

Due to volatility in the financial markets over the last couple of years, businesses and investors have changed their strategy choosing to increase their foothold in asset-backed investments. Investing in assets gives investors valuable goods that can be sold or traded should markets fail.

Making Whisky is both expensive and labour intensive; while the product matures, the value increases but is not moneymaking until it reaches an age where consumers wish to buy. Distillers have to wait for five to ten years before it becomes profitable. This is where the investor steps in to help the distillers. Scotch cannot be identified as Whisky until it has matured for three years, and even then, you wouldn’t be queuing up to drink the Whisky. Therefore distilleries make Cask Whisky available to the private investor to raise capital to cover costs in the early years of maturity. Whisky is always in demand, and this allows distilleries and independent bottlers to buy Casks from the investor to bottle or to keep in storage for a few more years. There is big money to be made with Whisky, and in most cases, this comes from aged Whisky. 90% of all Scotch Whisky Casks are bottled before they reach 12 years of age and used for Single Malt or Blended Whiskies. People can invest directly from the distillery or through a broker. Purchasing through the broker has many benefits; we buy in large quantities, giving our customers a reduced price due to our buying power. The longer you keep it, the more appealing it will be to buyers. If you make sure you service your Cask every five years and then more frequent as it ages, the price will generally increase more rapidly the longer you keep it, keeping its service history with the Cask until it is bottled.

Scotch Whisky has become increasingly popular in Asia, with China, India, Singapore and Japan heading the drive, purchasing more bottles than any other. Scotland’s distilleries can’t keep up with the demand as 42 bottles are exported out of the UK every second. There are currently around 22 million casks sitting in bonded warehouses across Scotland, and still, this is not enough. The demand for Whisky is that great emerging nations such as Australia, Germany, India and Taiwan are looking to fill the void. Some of these new distilleries have already won awards and are rising in popularity. However, none of these whiskies are as prestigious as Scotch. Scottish Whisky is now exported to 200 markets worldwide, which shows the popularity of this fine spirit.

Exit Strategy

Owners may wish to sell their casks to private investors and collectors, selling at a whisky auction, back to the distillery, or a brand. Whisky is in demand, and bottlers or blenders always want to buy good quality Whisky. As the customer owns the asset, they can choose when they want to sell; if the price isn’t to the customers’ expectations, the Cask can stay in storage by paying a small insurance and storage fee until they can demand a greater price.

Return on Investment

When investing, people always want to know the return on investment. Unfortunately, there is no fixed return, and it is impossible to work out the return on investment until you have sold your Cask. What separates this investment is an asset that increases in value as it ages. It will rise moderately in the early years, increasing in value as it matures, once it reaches eight years and beyond. When sold, you should expect the spirit to have risen by 10-15% per year on the initial investment. Casks can easily sell for double the amount and more on what the customer initially paid for the asset over ten years. By buying six to ten barrels, customers can get a very healthy return upon cashing in on their investment. Casks can be picked up anywhere from around GBP 2,200, USD 3,000, EUR 2,600, THB 100,000, AUD 4,200, NZD 4,400, CAD 3,800 and can go up to USD 200,000 – 1.5 million for top branded mature Casks. If you buy new pour Casks, you buy in at a lower price than a mature Cask.

Further Expenses

Some Casks come with storage and insurance built into the Cask price, and others charge annually or upfront; this cost is usually around £50 -£100 per year and a further £50 for a regauge every five years. These costs can vary but are all essential for the upkeep of your investment. If you wish to bottle the Cask, this is very expensive; we recommend that this investment be purchased to sell at a greater price in the future and leave for the experts.

Security

Whisky is huge business in the UK, equating to 21% of all food and beverage exports. Tax is worth a lot of money to HMRC, and they will always collect their taxes. For this purpose alone, Whisky is a highly regulated business, and if a Cask were to go missing, HMRC would come down extremely hard on the Warehouse, massive fines are placed on the warehouses, much more than the Casks are worth.

VAT and Capital Gains Tax-Exempt

As maturing Whisky identifies as a perishable good, there is no tax or VAT to pay on investment returns as long as the Cask sells whiles still in the Bonded Warehouse. So when you are ready to sell your Cask 5-10 years after your initial investment, owners receive the total amount depending on any small sales commissions arranged with the reseller.

Conclusion

If you are looking for an investment backed by a physical asset, you should really consider Cask Whisky. This medium to long term investment is VAT and capital gains tax-exempt. The customer physically owns the Whisky; it is time-dependent. The global demand for Whisky surpasses supply. The minimum investment is around £4,200 compared with other investments; this has a low entry point. If the customer isn’t happy with their Cask’s offer, they can always keep it longer. Casks are secured in a highly regulated and strictly governed UK bonded warehouse.

To begin your Cask Whisky Investment venture, please contact James Gamble at JAG-BA on +66 (0) 868 239 704 or james@jag-ba.com to arrange a meeting.

JAG Business Admin sponsored the Colonial Christmas monthly scramble on 12th December 2021. Nearest the pin, Mr Ian Doust, won a bottle of 12 years old Aberfeldy Sing Malt Scotch Whisky. Congratulations Ian!

JAG Business Admin was delighted to sponsor nearest the pin on the 16th October 2021 at the Colonial monthly scramble. Congratulations to the winner who took home a bottle of 10 years Benriach Single Malt Scotch Whisky.

The 80-year-old whisky from Glenlivet Distillery was put into an oak cask back in 1940.

A few years ago, the rare whiskey market — and especially the rare Scotch market — went through the roof, peaking at the most expensive bottle ever sold: a famed Macallan 1926 60-Year-Old Scotch selling for just shy of $2 million in 2019. Granted, since the start of the pandemic, the continuing escalation of these records has stopped. Whether that’s due COVID’s economic impact or the market simply maxing out is up for debate. But interest in rare whiskies has continued unabated. And since not every bottle sold can be a 1926 Macallan, sellers looking for a big payday have been focusing on other features that make their whiskies unique.

Since whiskey and aging go hand-in-hand, age is often the big selling point. Over the summer, the “oldest known bottle of whiskey” sold for well above pre-auction estimates — though the age of the bottle has nothing to do with the age of the whiskey inside. And on that note, last year, The Macallan released a 78-year-old whisky, billed as the “longest-aged” Scotch (as in, in the barrel) ever to hit the auction block. But in a different sort of escalating whisky battle, The Macallan can now kiss that record goodbye.

Read the full article (Food & Wine) →

A Macallan-1991 Cask just sold for a world record price at the Bonhams Fine and Rare Whisky Sale

Why buy one bottle of rare whiskey when you could have 202?

At the recent Bonhams Fine and Rare Whisky Sale, it was a Macallan-1991 Cask that caught the eyes of auction attendees, selling for a world-record HK$4,464,000 (that’s a bit over $573,000). As described by the auction house, the Macallan-1991 was distilled in December 1991 and re-racked in 2017 with sherry. The 51.5% ABV hooch will yield around 202 bottles.

“Cask collecting is fast growing as a trend and one which has become a Bonhams speciality,” says Daniel Lam, Bonhams Director of Wine and Spirits, Asia. “In 2019, we set a world record when we sold a Macallan 1989 cask for a per-bottle price of HK$17,103. The cask in this sale has achieved a per-bottle price of HK$22,099 — and a new world record — a very strong increase in just two years.”

Besides casks, Japanese whisky was a hot commodity; the Yamazaki and Karuizawa lots were 100% sold (overall, the auction had an 88% sell-through rate). The Karuizawa distillery has been closed since 2001; the final editions of their whisky will be released later this year and are fueling demand, according to Lam.

Whisky auctions don’t seem to be hitting a peak: Bonhams claims their 2021 sales have already surpassed their 2019 numbers by about HK$13.5 million.

Read the full article (Inside Hook) →

A whisky auction site set up by two brothers from the Speyside area is eyeing global expansion after selling a major stake to an investment group managed out of Hong Kong.

Whisky Hammer was founded in 2016 by brothers Daniel and Craig Milne who are originally from Macduff, Aberdeenshire, close to Speyside, an area renowned for the production of Scotch whisky.

The auction site, and its sister retail business Still Spirit, is poised for expansion after selling a 49 per cent stake of the Scottish family business to Rare Whisky Holdings, a whisky investment group run out of Hong Kong.

The multi-million-pound deal will deliver a 2.6-times return to retail investors on their original investment, who participated in a crowdfunding campaign just two years ago.

The success of Whisky Hammer has been recognised by Rare Whisky Holdings, which is the same management team behind the Platinum Whisky Investment Fund, the first private equity fund in the world to focus on rare single-malt whiskies.

Platinum Whisky Investment Fund launched in 2014, raised $12 million (£8.7m) and is in the final stage of its wind down, exiting at more than $24m in seven years.

Read the full article (The Scotsman) →

Profits from cask spirits are 100pc tax free

Roger Parfitt spent £4,700 on Scotch whisky almost 30 years ago on a whim. He never dreamt it would provide the key to unlocking his retirement….

Read the full article (Telegraph) →

When investing in Cask Whisky, you do so with confidence knowing the value will continue to rise until it is time for you to sell.

Buying a bottle of Whisky you love for £30, £150, £300 or more, what if you could buy a Cask? Well, you can now. Store the investment in a UK Bonded Warehouse and sell in ten years when the Whisky has increased in value.

Thanks to the Single Malt Whisky Distillers in Scotland, this is now a reality, and you are closer than ever to owning your Whisky Cask. All you need to do is provide a copy of your passport, proof of your address, pay the invoice, and you are one proud owner of a Cask of Whisky. That is not all; investors are rewarded when buying casks, purchasing four or more, and the customer will buy at a reduced rate.

With Whisky demand skyrocketing over the last decade, it is easy to see why investors are turning their heads to this luxury commodity. Not only that, Scotch Whisky is the pinnacle of all whiskies, the celebrity everyone wants at their party. As world whiskies continue to impress, none have the history or prestige as that of Scotch.

So think of the money you have sat in your bank waiting to buy something, invest it now, and recoup the rewards in ten years when it will be worth more than today.

How much would it be worth, you may ask? Well, that depends on how many you buy, but at 12 to 15% per year, you will undoubtedly be wealthier than you are now.

Connect with us to find out more about Cask Whisky Investment; our details are featured below.

Ever had someone ruin a fine scotch by serving it in a coffee cup? When it comes to whiskey, it’s all in the presentation. We’ve had hyped, renowned spirits disappoint us, and we’ve seen ho-hum bourbons come bursting to life—all because of the glass in which they’re served. So, what are the best whiskey glasses you can buy?

The whiskey experience differs with different types of glasses. We’ve listed 11 of the best whiskey glasses you can buy right now that rank 4.5 or more stars on Amazon.

But first, a few things to consider before choosing the best whiskey glasses for you.

Characteristics of the Best Whiskey Glasses

Appearance – The design and composition of the glass have a strong effect on the whiskey inside it. Look for the overall quality of the glassware, as well as the cup’s physical properties such as weight, girth, and grip. How does it feel in the hand? How does it look on the shelf? All of these characteristics are important in the grand whiskey drinking experience.

Drinkability – Drinkability is the ease of drinking from the glass. It’s dependent on the base weight, wall slope angle, and the diameter of the brim. There’s nothing worse than having to tilt a glass so far that when the whiskey does reach your mouth, it does so in a bomb and goes up your nose. That ain’t fun.

Nosing – Smell and aroma are an essential aspect of the whiskey drinking experience. Some drinkers prefer a narrow mouth, so the liquor’s aroma smacks them right in the nose when the glass is lifted. Others prefer a wider bowl to let their spirit breathe, which allows the ethanol fumes to escape and mellows the whiskey’s overall mouthfeel.

Read the full article (Men’s Journal) →

Whiskey drinkers have never had it so good. Over the past decade or so, the number of varieties has exploded, presenting tipplers with a mind-boggling array of options. You can now drink bourbon that’s aged entirely on the ocean, a truly kick-ass rye, or Japanese single malts that beat the Scots in blind taste tests.

All this poses a serious—if highly welcome—dilemma: What the hell should I drink?

Fear not: Men’s Journal is on the case. In addition to putting our own taste buds to work, we recruited 18 top experts from the wide world of whiskey—writers, bartenders, restaurateurs (and in some cases, all three)—who have collectively sampled over 1,000 bottles. Somehow, we narrowed them down to these 50, most of which can be found at any good liquor store and none of which should fail to please.

Read the full article (Men’s Journal) →