Suntory’s CEO Predicts Declining Sales Will Create a ‘Golden Age of Whiskey’ for Consumers — Here’s Why

(Photo: Suntory Global Spirits)

During a recent interview at the WSJ Global Food Forum, the CEO of one of the world’s largest alcohol conglomerates opined that declining liquor consumption, inflation and tariffs may unintentionally yield some of the best whiskey the market has seen in years.

Greg Hughes, CEO of Jim Beam and Maker’s Mark owner Suntory Global Spirits, clarified up front that he’s not fundamentally concerned about the future of alcohol consumption. But he admits that structural and cyclical forces have taken a toll on the industry, leading to a rise in unsold inventory and many millions more liters of whiskey in the barrel.

For the consumers, he says, that could ultimately prove to be a good thing.

“The great news is if you’re a whiskey lover, this is going to be your golden age of whiskey,” Hughes said. “Because there’s a lot of really remarkable bourbon and scotch and Irish and Canadian whiskey aging right now.”

“You’ll see, if you haven’t already, age statements start to come back on everything. There’s a reason that people have 25-year-old Laphroaig to sell — it’s because, at some point, demand didn’t meet supply and something sat in a barrel for 25 years.”

A recent report from the Financial Times suggests that five major drinks companies — Diageo, Pernod Ricard, Campari, Brown Forman and Remy Cointreau — are sitting on a total of $22 billion worth of aging spirits, the largest amount of unsold inventory in a decade. Kentucky alone is reportedly holding a record 16.1 million barrels of bourbon, while Scotland is staring down some 20 million casks of maturing scotch.

In theory, these could turn out to be some of the best barrels that enthusiasts have ever tasted. It should go without saying, however, that the “dire industry, great spirits” hypothesis comes with some caveats.

Bourbon is typically sold to consumers at a barrel age of six years, while scotch averages closer to 10. Part of that has to do with a Goldilocks-esque sweet spot of flavor; the other part has to do with environmental realities. Climates close to the equator can evaporate as much as 4% of liquid out of the barrel per year, sending distiller’s hard-earned work into the literal hemisphere. While the “angel’s share” isn’t a huge issue in Scotland, it takes a swift toll on the United States’ bourbon industry and Mexico’s tequila.

In other words, brands like Jim Beam can only wait so long before their oaked investments vanish into thin air. It’s a tricky tightrope, and one that engineers in Kentucky are already working overtime to remedy.

Buffalo Trace recently unveiled its oldest whiskey to date — a 30-year-old Eagle Rare Bourbon — thanks to the distillery’s experimental, closely climate-controlled Warehouse P. This kind of technology has largely been used to incubate obscenely expensive bottles, but it may soon become a necessity if more distillers are forced to sit on their reserves.