Bourbon: Thinking outside the barrel

21 August, 2018

With demand outstripping supply, Kentucky’s bourbon distillers are looking for alternatives to longer ageing. Shay Waterworth reports

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STEVE JOBS, ONE OF THE greatest US entrepreneurs of recent times, famously said “innovation distinguishes between a leader and a follower” and his company demonstrated this by revolutionising smartphones and shaping today’s society on an international level.

Although it would be impossible for an American whiskey brand to have as dramatic an effect on people’s lives, some key players are beginning to explore the unexplored and break away from traditions to find new styles. The iPhone of the bourbon category could be on the horizon.

SUPPLY AND DEMAND

In a previous edition of this magazine, the issue of Japanese whisky’s lack of stocks was addressed and it seems American whiskey is experiencing a similar issue, albeit not quite as extreme. Fred B Noe III, Jim Beam’s master distiller, says: “I think the only thing holding us back is the supply of aged products. If we go to the trouble of educating people on what bourbon is all about and then can’t supply the demand, we’re just teasing the audience. We need to ensure that when we enter a market with a new product we’re able to meet the demand for it.”

The reason it’s difficult for producers to hold back their stocks for older, more premium products is that the popularity of their younger stocks is growing so rapidly both across the US and internationally.

“The demand curve in the US is so big, which is satisfying to watch but is also an issue for retaining old stocks,” Noe adds.

A NEW ERA

In order for a product to be labelled ‘Kentucky straight bourbon whiskey’ it must be aged for a minimum of two years in new American oak barrels. This is advantageous for many brands because, in theory, there is a reliable source of new barrels and the whiskey doesn’t need to be aged as long as scotch before it’s sold, meaning a higher production rate. However, Jim Beam’s White Label is aged for four years, double the required time, and changing this isn’t an option.

“Consistency is the most difficult thing to maintain – ensuring someone who’s been drinking Jim Beam White Label for 40 years still gets a smile out of the whiskey,” says Noe.

“There’s not just one solution to the supply issues at this point. In days gone by you could buy in whiskey from different suppliers, but nobody is selling on the open market like they used to because the demand is so great.

“A lot of well-known whiskeys don’t have a distillery, they just buy from other suppliers and blend them together. But what’s happening now is the demand is so great that these suppliers are bottling their own whiskeys for themselves.”

Lux Row Distillers is one of the new generation of distilleries to open its doors in Kentucky, laying down its first barrels at the start of the year. Owned by beverage giant Luxco, the new distillery acts as a home for the company’s premium portfolio of Kentucky straight bourbon whiskeys and investment is as big as the growing demand, with $40m being spent on the new distillery, visitor centre and rick houses.





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