Local whiskies douse rivals

The top performer whiskies of South Africa both come from the James Sedgwick Distillery in Wellington, Western Cape.

local whisky James Sedgwick Distillery
The picturesque James Sedgwick Distillery in Wellington produces a range of world-acclaimed whiskies. (Images: Three Ships Whisky)

Bhekumuzi Mdakane
The whisky industry has been historically dominated by Scotland and Ireland, which of course produces whiskey, but other nations – of which South Africa is one – are giving the old countries a run for their money.

South Africa brings its own blends and home grains to the industry, though the country is still maturing as a whisky maker. Yet its Three Ships five-year-old Premium Select was named the world’s best blended whisky of 2012 at the annual World Whiskies Awards, held by Whisky Magazine. This is the first time a South African product captured the title.

And its first single-grain whisky, Bain’s Cape Mountain, which was launched in 2009, has to date won three gold awards at the International Wine and Spirits Competition.

local whisky Bains and Three Ships
(Image: Green Girls in Africa)

These top performers both come from the James Sedgwick Distillery in Wellington, Western Cape, which has been described as the only dedicated whisky distillery in all of Africa. Recent renovations and new equipment, including new copper stills and a highly advanced control room, have modernised the facility, although the fine taste of its products remains the same.

The plant was named after the 19th century sea captain James Sedgwick, who arrived in South Africa in 1850 and became one of the pioneers of the region’s liquor industry. Its sixth master distiller, who has been at the helm since 1991, is Andy Watts.

Bain’s is named after engineer Andrew Geddes Bain who built the scenic Bainskloof Pass in the 1850s, at the foot of which stands the distillery.

Local whisky facts and figures

According to the Scotch Whisky Association, which is based in the UK, exports of the golden liquid to South Africa have been declining. In 2010, they stood at R1 951-billion (US$223-billion); in 2011, they dropped to R1 911-billion ($218-billion).

The most recent figures have shown a 16.4% fall in imports to R633-million ($72-million) for the period January to July 2012, compared to R756-million ($86-million) for the same period last year.

Sarah Truen from the consulting firm DNA Economics, in Pretoria, says: “Imported whisky appears to be faring less well. Measured in terms of absolute alcohol content, imports of whisky grew 7% in 2011, versus 27% growth in total spirits imports.”

Despite the fall in import value, South Africa is a top 10 Scotch whisky importer, surpassing Canada and Australia. And the country is the biggest whisky importer on the continent, followed by Angola, Morocco, Nigeria and Egypt, the association’s figures show.

The total VAT and excise contributions across the liquor industry are estimated to be R19-billion ($2.2-billion), which implies that 40% of the direct value added by the industry goes to the government. On the whole, the manufacturing and selling of liquor is estimated to have contributed R93-billion ($11-billion) to the economy in 2009/10, or 3.9% of the 2009 gross domestic product.

The value of whisky has gone up 400% in the last four years; by comparison, the value of gold has risen 146% in the same period, so it’s easy to see the attraction of investment-grade Scotch. And experts predict that the value of the whisky auction market will increase four-fold over the next eight years, so now is the time to invest.

Contributing to the economy

Liquor producer and marketer Distell, whose portfolio includes Bain’s and Three Ships, contributed R37-billion ($4.3-billion) to the country’s economy, according to its 2012 annual report. The company said that the strongest growth in the spirits category came from whisky and cognac, with Three Ships posting double-digit volume growth.

Distell has also undertaken the only significant black economic employment (BEE) transaction in the spirits market, giving 15% of its ordinary shares to BEE shareholders through a deal that includes a consortium of Distell employees, a corporate social investment trust and Women Investment Portfolio Holdings, or Wiphold.

“With such quality credentials in our favour, and as South Africa’s largest local whisky producer, we believe we are well-positioned to capitalise on future growth in domestic whisky consumption,” read Distell’s annual report.

A DNA Economics report produced in 2011 stated that “the value of strong brands is of particular importance in the whisky market”. Compared to other international markets, the report found, South Africa displayed a high consumption of premium and super premium whisky, with 87% of whisky sold falling into these two categories. This growth, said DNA Economics, was driven by the so-called “black diamonds” or black middle class.

Other up-and-coming brands

But Three Ships and Bain’s are not the only whiskies made in South Africa, and as new brands break into the market, expanding job opportunities and career choices add to the industry’s contribution to the country’s economy.

Other local brands that are growing a strong following include Drayman’s Single Malt Whisky, the creation of brewer Moritz Kallmeyer, who has added whisky to his product range. Kallmeyer owns and runs Drayman’s Brewery in Pretoria. He produces Drayman’s single malt and solera whisky from a variety of top-quality imported Scotch and South African whiskies. The products are an artful mix of aged single malts and younger blends, which are then further matured in casks.

Players on the South African whisky scene include Brandhouse, a joint venture between Diageo, Heineken and Namibia Breweries, and Pernod Ricard, which has the Chivas Regal Scotch Whisky and Jameson Irish Whiskey brands.

Exceptional performance

While these are imports, South Africa’s own whisky brands are growing in value, with advertising and marketing helping to capitalise on the tipplers’ tastes. Marcel Swain, the brand manager of Three Ships and Bain’s, said: “More focus is being placed on the brand with a new through-the-line campaign to be launched in the new year – exciting times.”

He added that the Three Ships brand was performing “exceptionally well” after collecting its international accolades, while Bain’s Cape Mountain Whisky had been listed in Whisky Magazine, the UK’s best-selling whisky publication.

Whisky festival

And adding to the growing appreciation of the fiery amber liquid is the annual FNB Whisky Live Festival, which claims it is becoming the largest and liveliest whisky festival in the world. It attracts locals and foreigners alike. They include global brand ambassadors, master distillers and whisky experts from all over the world. Now in its 10th year, the festival has estimated its attendance figures at 18 000.

Spirits writer and aficionado Dave Broom, for example, attended the New York Whisky Festival before coming to South Africa for the FNB event. Others who have made the trip include Karen Fullerton, the global brand ambassador of Glenmorangie; Dennis Malcolm, the master distiller at Scotland’s Glen Grant; and Martine Nouet, a whisky and food expert from France.

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