American whiskey supplies may ‘never catch up’

American whiskey producers may “never catch up” if consumer demand continues to outpace supplies, Buffalo Trace has warned.

Buffalo Trace is still experiencing inventory shortages

Speaking to The Spirits Business before Christmas, Kris Comstock, brand manager for Buffalo Trace, confessed that while production is increasing, currently the distillery’s inventory is only as much as what was distilled 10 years ago.

“We are continuing to do our best to supply our customers as best we can,” he said. “But our whiskeys are aged for eight to 10 years and beyond, so our inventory is what we distilled a decade ago.

“Our production’s increasing and it has been increasing for some time.

“Each year we make a bit more than we did the previous year. In theory we will catch up at some point if demand doesn’t continue to grow.

“But if demand continues to outpace our inventory growth, we might never catch up.”

Careful investment

Last year, several large investments were made to expand and build new American whiskey distilleries.

Diageo channelled US$115m (£74m) into building a new distillery in Shelby County, Tennessee, in 2014 while Buffalo Trace bought 233 acres of land to create single estate Bourbon and rye whiskey in Frankfork, Kentucky.

However, as the industry watched Scotch suffer significant sales declines last year – which resulted in Diageo putting its Scotch investment plans on hold – American whiskey producers are being especially cautious about the investment routes they take.

“It will be careful growth over several years,” reasoned Comstock. “We don’t want to get to 2022, 2024 or 2026 and all of a sudden we have copious amounts of whiskey just sitting there not selling.

“We are very careful about how we expand, but there has to be some faith.

“Every year there’s be a bit more Buffalo Trace, but whether it’ll be enough to satisfy thirsty Bourbon drinkers two or three years from now, that’s the question.”