Tuesday, July 31, 2012

Scotland follow-up, part 3

On the evening of our first night on Islay, my father and I sat in the lounge of the Harbour Inn, enjoying a glass of wine and perusing the dinner menu. I couldn’t help but overhear the conversation between the two upper-crust English couples sitting nearby. When the topic turned to local distilleries, a rash of criticism was aimed at Bruichladdich. Most of their ire revolved around the dizzying array of special releases that had come out of the distillery in recent years (a debatable point, but beyond the scope of this post). Then one of them made a proclamation, something along the lines of “And what on earth are they doing now, mucking about with gin?” in reference to the Botanist Gin, which Bruichladdich started producing in 2010. With personas reminiscent of Thurston Howell III, I’m sure they had made their millions many times over, but they seemed to be oblivious to the economics of the whisky industry.

With lead times of 10 or more years between production and sales, and a product demand prone to unpredictable cycles of boom and bust, whisky is a tricky business to say the least. Gin, on the other hand, seems to have enjoyed a more stable pattern of consumption in recent history. And because it is not aged, increases or decreases in production can quickly affect inventory levels, so supply can be promptly adjusted to meet changes in demand. It doesn’t take much insight to see that gin is the perfect economic ballast for the treacherous seas that every whisky company must navigate. Of course, I refrained from informing my fellow diners of their ignorance.

A week later I was in Whisky School, where I learned much more about the inner workings of the whisky business. While the subject matter was primarily focused on production, I was still able to pick up some information along the way that helped me to infer a lot about the operational philosophy of Springbank’s parent company, J&A Mitchell & Co. By the end of the week, I had come to the conclusion that the history of Campbeltown’s whisky industry had been well studied, and that the lessons learned are currently being applied. The following is my analysis of what is being done to keep the mistakes of the past from being repeated.

In the first half of the 1800’s Campbeltown became Scotland’s most praised and respected whisky producing region, and was often referred to as the “whisky capitol of the world”. Just having the word Campbeltown on the bottle was enough to command consumer attention, and the town’s single malts were highly desired by blenders. Nearly two dozen distilleries were licensed here in the 1820’s and 1830’s, and the town was actually granted regional status, like the Highlands and the Lowlands. Unfortunately, that massive success partly led to the region’s downfall in the early 1900’s. Quality was compromised for quick profits, and with a tarnished reputation and plunging demand the vast majority of Campbeltown’s distilleries closed in the 1920’s. After a handful more closed in the 1930’s only two distilleries, Springbank and Glen Scotia, remained active for the rest of the 20th century. Not only had the town lost its prestige, it eventually lost its official status as a whisky producing region.

After my time there, it is my belief that returning some of the former glory to the area’s whisky industry is part of the master plan of the management of J&A Mitchell & Co. The resurrection of the Glengyle distillery in 2004, along with the introduction of Hazelburn single malt in 2005, has brought the town to a total of five unique single malts from three operating distilleries. The Scotch Whisky Association has recently reinstated the town’s official regional designation. The company has also started to integrate the phrase “Campbeltown Malts” into their marketing campaigns. Looking to the past, it seems obvious that they have seen the importance of not just promoting individual single malts, but also promoting the town as a region with a reputation for producing whisky of exceptional quality.

Campbeltown distillers enjoyed unrivaled prestige and a stronghold on the Glasgow market for much of the 19th century. But by the turn of the century, many distillers had tried to take advantage of the success of the region and maximize profits, even if it meant putting out an inferior product. I’m speculating here, but it is probable that lower quality, imported barley was used (demand likely having outpaced local production levels), short fermentation times employed, and stills would have been run hot and fast, with a wider cut taken. All of these steps would have sped up the process and increased output. The inferior spirit was then aged in substandard casks. I’m not sure if it was a rumor spread by competitors or just the running joke of the day, but at one point Campbeltown whiskies were said to be aged in old herring casks. The region’s reputation was ruined.

Springbank managed to maintain an image of quality throughout the tumultuous times. J&A Mitchell & Co seems to recognize very well the importance of continuing to produce first rate whiskies, and even though their two distilleries are set up very differently, they both achieve this in the end. Springbank is more of a working museum; the whisky is very much hand made, in an often labor intensive manner. It seems like the process is slow and inefficient here, sometimes just for the sake of maintaining tradition, but more often for the sake of maintaining quality. By contrast, Glengyle has a more streamlined layout, and a lot of modern equipment that minimizes the man power need to run it. But at the same time, as with Springbank, 100% of the barley used is floor malted and sourced only from Scotland, and long fermentation times in boat-skin Larch washbacks are followed by a slow distillation. The spirit is then aged in quality casks which have been carefully procured from reliable sources. Neither distillery has ever chill-filtered or added artificial coloring.

The death knell of the Campbeltown whisky industry was a combination of overproduction and a series of events that caused a dramatic decrease in demand. Times of high demand led to overconfidence, and many distillers increased their output to reckless levels. Much of this demand was driven by blenders and speculators who ended up sitting on stockpiles of overpriced whisky. When Pattison’s, Scotland’s largest blender at the time, collapsed in 1898 amid a fraud scandal, Campbeltown’s biggest whisky customer was gone over night. The construction of railroads in the late 1800’s into the Speyside region (which was rich with distilleries) provided easy access to Glasgow, breaking Campbeltown’s monopoly on that important market. WWI (1914-1919), Prohibition (1919-1933), and the Great Depression (1930-1940) all caused a strain on the whisky industry in general, and on Campbeltown in particular with its weakened reputation.

The powers that be at J&A Mitchell seem to be committed to not letting history repeat itself. Citing unstable commodity prices in 2008, Springbank stopped production for two years. Many in the industry thought this odd at the time, as whisky seemed to still be in a boom period that started earlier in the decade. But considering the current economic state of the world, especially the EU, it now looks to have been a very wise move. The Springbank distillery is currently operating at about half of its annual production capacity.

A lot of people are also very surprised to learn that the new Glengyle distillery is only operational for one month out of the year (it is run in November by the Springbank staff when that distillery is closed for maintenance). But until the flagship 12yr old becomes available in 2016 and actual demand levels can be established, it makes sense to minimize production. The alternative is to risk sitting on a huge stockpile of single malt that can’t be sold.

The company also keeps tight control over the whisky it produces these days. Very little Springbank makes it into blended whiskies and most of it that does ends up in their own Campbeltown Loch and Mitchell’s 12yr blends.

As a student of Whisky School, I learned that the parent company of Springbank has acquired most of the land between that distillery and Glengyle. The areas that they aren’t currently using are being leased out to other businesses, but are available to build future warehouses or even a second bottling hall. Although they are operating in a fairly conservative mode right now, they are smartly positioned for future growth, should market conditions warrant it.

And now my ramblings have come full circle, back to gin. In 1972, the independent bottler William Caddenhead added Old Raj Gin to its portfolio of products. Perhaps it is just coincidence, but that is the same year that Caddenhead’s was acquired by J&A Mitchell & Co. I’m not sure where the gin is distilled, but I did learn that the addition of Saffron (which makes Old Raj rather unique) happens in-house, and that the gin is bottled in the Springbank bottling hall. Maintaining a gin as part of their product line seems to be just one more step that the company has taken to ensure a long future.

Wednesday, July 11, 2012

Kilkerran, Work In Progress 2

stats: single malt scotch, Campbeltown, 92 proof, 6yr, $55

The history of the Glengyle distillery is intertwined with that of the Springbank distillery, so one must go back to their beginnings to see how things have some full circle.

In 1837 brothers, John and William Mitchell acquired the Springbank distillery which had been established in 1828 on the site of the malt barns and illicit distillery owned by their father, Archibald Mitchell II. At some point, William left Springbank after quarrelling with his brother over sheep. He joined his other two brothers at their distillery, Rieclachan, before eventually going out on his own, establishing the Glengyle distillery in 1872.

Glengyle was the 32nd of 34 distilleries to be licensed in Campbeltown in the 1800’s. Several of these operations closed in the 1850’s, but most went out of business after 1890. Glengyle held on until 1925, and with the 1934 closure of Rieclachan, Campbeltown was left with just Springbank and Glen Scotia as operating distilleries.

For a time after the closing, the Glengyle distillery buildings were used as an indoor shooting range by the Campbeltown Miniature Rifle Club. Attempts to bring the distillery back into operation were made in the 1940’s and again in the 1950’s, but neither was successful. By 1970 all of the equipment related to distilling was gone, and the buildings were being put to use by the Kintyre Farmers Cooperative.

Finally, in the fall of 2000, a new company was formed by J&A Mitchell & Co, with the intention of purchasing the former Glengyle site and returning it to its original purpose of whisky production. As the parent company of Springbank, J&A Mitchell & Co is currently led by Hedley Wright, who is a direct descendant of Archibald Mitchell II. Not only was the long deceased distillery being brought back to life, it was also being brought back into its founding family.

Assembling a distillery from scratch in abandoned buildings, whose restoration had to adhere to historical codes, was no easy task. It would be 3 ½ years before distillation took place. A used malt mill was acquired from the recently upgraded Craigellachie distillery, and the long dormant stills of Ben Wyvis were brought out of retirement for use at Glengyle (Ben Wyvis was a malt distillery which operated within the Invergordon grain distillery complex from 1965 to 1977). The rest of the equipment in the distillery would be new and purpose built.

Currently, all of the barley for Glengyle is malted (on traditional floor maltings) at Springbank. The former malting facilities at Glengyle are available (but in need of restoration) should future demand dictate that each distillery have the capacity to malt barley in-house. All of the Glengyle casks are currently being stored in the Springbank warehouses, but there is plenty of space available between the two distilleries for future warehouse expansion.

All things considered, it was logical to name the new distillery Glengyle. Unfortunately that name was already being used for a vatted malt from the Highlands, so an alternate name had to be chosen for the single malt produced at the Glengyle distillery. Kilkerran was selected as it is derived from the Gaelic name of the original settlement of Saint Kerran, in the current location of Campbeltown.

Ultimately, the standard Kilkerran bottling will be a 12yr, but that won’t be available until 2016, so some younger variants are being offered in the mean time. The first six casks (each of a different type) have been put up for sale as bottles which can be bought in advance for £175 a piece. These will be bottled as 10yr olds in 2014. Additionally, each year, from 2009 – 2013, a “Work In Progress” bottling of whisky distilled in 2004 will be released in limited quantity.

Tonight I am tasting Kilkerran Work In Progress 2, a 6yr old released in 2010.

It is pale golden in color, and the nose is full, with aromas ranging from floral to sweet/malty. Medium to full bodied, it’s primarily floral on the palate with a malty backbone, and turns warm/spicy on the finish. No flaws, but it comes across as being a bit immature. The finish isn’t big, but lingers on palate for some time, with just a hint of peat smoke emerging.

If this had been the only example of Kilkerran I had tasted, I likely would have relegated it to the category of “wait and see” (for the 12yr bottling). But as I mentioned in the “Scotland, Day 13” post, I had the opportunity to taste a sample of 8yr Kilkerran directly from a port cask (one of the original six casks filled in March 2004), and was stunned to say the least. I have seen the potential, and I’m looking forward to future Kilkerran bottlings with great anticipation.

Tuesday, July 3, 2012

Scotland follow-up, part 2

It seems like the more I learn about whisky, there more questions I have. There are some very informative books and magazines out there, and the internet is a great resource, but you can only get so far with Google. My distillery tour of Scotland was an opportunity to have many of those burning questions answered right at the source.

The typical distillery tour guide was usually well informed, but often lacked the depth of knowledge that comes with decades of employment in the industry. However, they were more likely to let out little bits of information that someone higher up the chain of command might keep tight-lipped about. For the tough questions, and especially when I wanted to know how things were done prior to the modern era, access to men like Iain McArthur at Lagavulin and Frank McHardy at Springbank was essential.

When I started asking questions about the Teapot Dram bottling that I tasted at Glengoyne on Day 1, the women in the shop were quick to produce a spec sheet for the whisky with all sorts of information about it and the 5 casks that were vatted together to create it. This is the kind of technical whisky detail I love to pore over.

It was interesting to hear which distilleries were running at what percentage of their maximum capacity – from Springbank and Bunnahabhain at 50% to Kilchoman and Caol Ila near 100% - as well as what percentage of a distillery’s production went to blenders, with Caol Ila at 95% and others claiming none at all (I believe Auchentoshan was amongst them).

One bit of information that I caught (and wonder if it wasn’t meant to be kept secret) was that the composition of Ardbeg Uigeadail has changed since it was originally released. Made up of younger bourbon cask whisky vatted with older sherry cask whisky, we were told that the sherried whisky stocks (of the particular age they had been using) were depleted and they had to decrease the age of the sherry component at some point. There is no way to tell by looking at the bottle, it has no age statement, and even if it did, the age would be of the youngest whisky in the bottle (the bourbon component in this case). I’m still a big fan of Uigeadail, but it has never seemed quite as magical as that first bottle I bought. Now I know why. This also explains the slight price drop of Uigeadail that I noticed after it had been out for a year or two.

For years I have heard about shortages of Lagavulin being caused by a big fire in the past at the distillery. I always had my doubts, and jumped at the chance to ask Ian MacArthur after the Warehouse Tour. He set the record straight: there was no fire at the distillery and they never closed. Along with the rest of the distilleries on Islay, they had a major slowdown in production in the 1980’s (actually, many of the others did close down for some time). This caused a serious shortage of their flagship 16yr single malt in the late 1990’s and early 2000’s.

Another myth that was dispelled on Islay had to do with the origins of Laphroaig’s distinctive medicinal / iodine flavor. I have always heard that this was caused by sea spray laden air permeating their casks. This never made much sense, as Lagavulin and Ardbeg are just a few miles away and also have warehouses right by the water on the same stretch of coast, but do not share this taste characteristic. While touring Laphroaig we were told that they hand cut all of their peat (for the 30% of their barley that they malt themselves), and the peat beds that they own contain an unusually high concentration of decomposed lichens and moss – heather, ferns, and grasses are more common. This unique peat is supposed to be the source of Laphroaig’s particular iodine pungency.

I had noticed the heavily tarnished stills at Bunnahabhain (and subsequently Glen Scotia) in stark contrast to the proudly shining pots at most of the other distilleries. Whenever I asked how that luster was maintained, I seemed to get a blank stare. Until I asked Frank McHardy, then it was a simple answer that they were washed with an acid solution and coated with a clear lacquer. This was done every five years or so. I was nice to have access to someone with close to five decades in the industry.

A few more interesting bits were gleaned at Springbank. We were told that the 8yr Hazelburn would be phased out in favor of the 12yr variant. We also learned that Hazelburn Rundlets and Kilderkins (aged in smaller casks, like the Springbank version that appeared recently) would come out in two years. Another interesting bottling that we learned about was the Longrow Red that will come out later this year. It is and 11yr old that spent 7 years in refill bourbon barrels and 4 years in casks that had previously held Long Row Cabernet Sauvignon from Australia. The official press release about this came out about five weeks after I learned about it at the distillery, and while there, we loaded new make Springbank into some of those recently emptied Cabernet casks.