Jack Daniel’s defends Tennessee whiskey definition from Diageo

Jack Daniel’s has warned that Tennessee whiskey is “under attack” by Diageo, as legislation proposed by the British drinks group allowing the reuse of barrels in production awaits approval.

Jeff Arnett, master distiller for Jack Daniel’s, argued that Diageo is working to “undermine” the Tennessee whiskey brand’s heritage

Jack Daniel’s owner Brown-Forman last year successfully led a campaign to have Tennessee whiskey recognised as a designation in the US.

Legislature was passed by the Tennessee General Assembly in May 2013 that protects Tennessee whiskey as being made from fermented mash of at least 51% corn, charcoal mellowed, and aged in new oak barrels within the State – the same recipe used for Jack Daniel’s.

However, Diageo, which owns the George Dickel Tennessee Whiskey brand, has since argued that allowing producers to reuse barrels more than once would deliver significant cost savings, not just for the British multinational, but craft producers too.

Its proposed change is currently pending approval at the Tennessee House State Government Committee and Senate State & Local Government Committee.

But Jeff Arnett, master distiller at Jack Daniel’s, views the proposal as less about freedom and more about “undermining the process we’ve worked for nearly 150 years to protect”.

“This is not about the interests of micro-distillers in our state,” he said. “We support micro-distillers. This is about Diageo, a large foreign company with more interest in Scotch and Bourbon, trying to weaken what Tennessee whiskey is and we simply shouldn’t allow it.”

Arnett argued the current designation protects Tennessee whiskey as a quality product: “No one is saying that companies can’t make the product however they want – whether that’s not charcoal mellowing it or even using old barrels. They just shouldn’t be able to label it Tennessee whiskey.

“It’s a real head scratcher why anyone would support legislation classifying our product as inferior to bourbon,” Arnett added.

Barrier to growth?

Diageo has responded with claims that Brown-Forman is attempting to “stifle competition” and a “new breed of distillers” by blocking the change.

“This isn’t about Diageo, as all of our Tennessee whiskey is made with new oak,” Guy L Smith IV, Diageo executive vice-president told Associated Press. “This is about Brown-Forman trying to stifle competition and the entrepreneurial spirit of micro distillers. We are not sure what they are afraid of, as we feel new innovative products from a new breed of distillers is healthy for the entire industry.”

Republican state representative Bill Sanderson agreed that the current requirement to mature Tennessee whiskey in new barrels is a challenge for small distillers. “We want to open it back up. We are still going to define Tennessee whiskey, but not as narrowly as Jack Daniel’s would like us to,” he told Fox Business.

As Jack Daniel’s manufactures its own American oak barrels, Sanderson argued the company already has a competitive advantage.

“They are a big bully picking on all the little guys,” he said.

Exports of Bourbon and Tennessee whiskey reached US$1 billion for the first time in 2013, with Tennessee whiskey one of the top 10 exports for the state.