Kentucky Bourbon generates $9bn in 2023

An annual report from the Kentucky Distillers’ Association shows continued growth and job creation for the Bourbon sector.

Using data from 100 distilleries in 42 counties, the Kentucky Distillers’ Association (KDA) released its annual economic report yesterday, noting continued growth for job creation, tax revenue, tourism, and agricultural impact.

The report shows that Kentucky Bourbon is now generating US$9 billion for the state, with distilling responsible for more than 23,100 jobs with annual salaries and wages of US$1.63bn.

Kentucky now has 100 licensed distilleries operated by 84 companies in 42 counties, with distillers producing a record 2.7 million barrels of Bourbon in 2022. Today, 12.6m barrels are ageing in the state, with the distilling industry generating US$358m in state and local taxes.

During a news conference announcing the report, governor Andy Beshear called 2023 “another blockbuster year that shows there’s a limitless future for Bourbon in Kentucky.”

He called for the state not to move right or left, but forward. “This is an important time for Kentucky,” he said. “This is historic progress.”

The KDA credits this growth to legislative changes enacted over the past decade. Most notable is a 2016 tourism reform that allowed distilleries to serve cocktails, operate restaurants, and increase gift shop sales. In 2023, Kentucky distillers reported a record 2.55m in total attendance, with 95% highly satisfied with their experience. The report showed that Bourbon tourists are trending younger, staying longer, and spending more, with 76% visiting from out of state.

“The Kentucky Bourbon Trail has made massive contributions to the two essential features of tourism – providing visitors with experiences resulting in long-lasting memories and generating important economic benefits for the communities they visit,” said Hank Phillips, Kentucky Tourism Industry Association president and CEO. “Bourbon has become more than an attraction in its own right. It is a Kentucky calling card, attracting many visitors to Kentucky’s broader array of exciting tourism opportunities. The Kentucky Bourbon Trail deserves enormous credit for that.”

Bourbon has likewise had a significant impact on the state’s agriculture industry. Corn production in core distilling counties is up 300% since the first 2009 study, with distillers purchasing 21 million bushels of Kentucky-grown corn and grains in 2023.

“Kentucky agriculture and farmers have seen the impact of the Bourbon industry boom firsthand,” said commissioner of agriculture Jonathan Shell. “ The economic effects on our industry are building a stronger agricultural community for years to come.”

What’s more, Kentucky distillers are continuing to spend. KDA members are planning to invest US$3.5bn over the next five years, with $194m going towards expanded tourism operations.

Earlier this year, Garrard County Distilling began production in Kentucky, while RD1 Spirits revealed plans for a US$4.8m distillery in the state.