German Whiskey Distillers Are Starting to Hit Their Stride

March 21, 2019, 1:28 PM UTC

Whiskey has become big business—now even with its own investment fund. One of the places the fund may be looking at is up-and-comer Germany.

The German brewing industry’s spirits are up, according to the Associated Press. Whiskeys from the region aren’t well known in other countries—production was worth $13.1 million in 2017, compared to Scotland, which saw $5.8 billion in exports alone. However, Germany already has 180 distillers to Scotland’s 130.

German production is gaining recognition for the quality of products and world events may be moving in their favor. Brexit could see big tariffs on alcohol exports from the U.K. to the EU, which is the most important market for scotch, as the Scotch Whiskey Association told AP. If so, there would likely be more market opportunities, although German distillers would have to seriously increase their production.

U.S. whiskey production could step in, except that it has its own troubles. It was a market on fire. But then, Trump’s trade wars happened. Canada, China, Mexico and the EU placed extra import duties—ranging from 10% to 25%—on U.S. whiskeys in 2018. In the second half of that year, U.S. whiskey exports were down 11%. That was after a first half, before the tariffs, that show sales on the rise. The EU, which placed a 25% tariff on shipments, had been the largest export market.

If EU buyers find both U.K. and U.S. products too expensive, that could leave them open to a switch to German whiskeys, which would carry no duty. In the not too distant future, you might hear people from Madrid to Copenhagen lifting a glass and saying, “Prost!”