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IRISH WHISKEY
CASK INVESTMENT
Why Invest in Irish Whiskey
Investing in Irish whiskey casks has become an increasingly popular alternative to traditional investments, with many investors expecting higher returns with the increasing demand for Irish whiskey in recent years.
Irish whiskey exports to the USA experienced a record growth of 16% in 2022, reaching $1.3 billion(1). The Irish Whiskey Association (IWA) predicts that the market will double in size by 2030(2) and surpass Scotch Whisky in US export figures. However, with the current production rate of Irish whiskey at 110 million LPA (Litres of Pure Alcohol)(3), it may not be able to keep up with the rising demand.
The Irish market would require a reserve of 950 million LPA of maturing whiskey to meet the projected demand. This shortage has created investment opportunities, where interested parties can purchase casks of Irish whiskey that will be stored in a secure, insured bonded warehouse. A certificate of ownership will be issued to the buyer for each individual cask purchased. Regardless of whether you are a private investor or represent a client, the investment process will be supported every step of the way.
Source: 1. Distilled Spirits Council 2022 Report / 2. The Guardian 2022 / 3. Drinks Ireland (ibec.ie)
“Over the last five years, Irish Whiskey has grown 13.4% in compound annual growth, with analysts predicting the growth to continue surging.”
Forbes, 2020
“Worldwide sales of Irish whiskey have risen by more than 300% in the last 10 years, the Department for International Trade (DIT) has reported.”
The Spirits Business, 2019
“Drinks industry analyst IWSR projects that Irish whiskey sales will grow by 33 per cent from 2020 to 2024.”
Irish Times, 2021
Why Irish Whiskey?
Investing in Irish whiskey presents a compelling opportunity for several reasons. Firstly, the global Irish whiskey market has experienced significant growth, reaching a size of US$4.7 billion in 2022.(1)
This growth is expected to continue due to factors such as the rising popularity of premium and craft spirits, whiskey cocktails, and the expanding Hotel, Restaurant, and Cafe (HORECA) sector (2)
Secondly, Irish whiskey has a rich cultural heritage that sets it apart from other whiskeys, creating a strong brand identity that resonates with consumers. Thirdly, Irish whiskey is renowned for its high-quality production standards and strict regulations, ensuring consistent quality and reliability.
Overall, investing in Irish whiskey is an attractive option for investors looking to diversify their portfolios and capitalise on the growth of the Irish whiskey market.
Source 1 & 2: www.imarcgroup.com/irish-whiskey-market
How Investing Works
Embark on a captivating journey into the world of Irish whiskey cask investment, where the fusion of heritage, craftsmanship, and potential financial opportunity unfold.
1. Distilling
After undergoing distillation, the whiskey is then patiently aged within barrels, setting the stage for its exquisite transformation.
2. Private Investors
For a minimum investment of one cask, you'll receive the barrel, five years of storage, insurance, and full ownership rights to sell or bottle the whiskey.
3. Aged Value
Each barrel should be equivalent to a minimum of 380x 70cl bottles (40% abv) after five years.
4. Exit Plans
There are several exit options you may use for your investment, which is outlined in detail in our FREE guide.
Exit Strategies
Introducing a range of flexible exit strategies tailored to suit your investment objectives.
PRIVATE INVESTORS
Private investors frequently approach our current clients to purchase mature stock in order to bypass the lengthy maturation process.
AUCTION
Whiskey auctions can be used as an exit strategy, particularly for aged whiskey.
SIMPLY ENJOY
Simply enjoy your whiskey for your own personal consumption. We also offer bottling and labelling service.
Frequently asked questions
What am I buying?
You are buying as a private purchaser one or more 200 litre casks (barrells) of Irish whiskey which will
be stored on your behalf (duty suspended ) in a regulated bonded warehouse. You can sell or consume the whiskey once it has matured. If you purchase a cask of freshly distilled new whiskey (fresh fill) then it must
be matured in storage for a minimum of 3 years in Ireland before it can be consumed or sold and categorised
as Irish whiskey. Generally the more mature and older the whiskey becomes the more valuable the cask.
We recommend that you wait at least 5 years before you sell or consume your whiskey.
What type of Irish whiskey should I buy?
You are buying as a private purchaser one or more 200 litre casks (barrells) of Irish whiskey which will be stored on your behalf (duty suspended ) in a regulated bonded warehouse. You can sell or consume the whiskey once it has matured. If you purchase a cask of freshly distilled new whiskey (fresh fill) then it must be matured in storage for a minimum of 3 years in Ireland before it can be consumed or sold and categorised as Irish whiskey. Generally the more mature and older the whiskey becomes the more valuable the cask. We recommend that you wait at least 5 years before you sell or consume your whiskey.
Does Irish Whiskey increase in value as it gets older?
Generally the older Irish whiskey matures the more it appreciates in value. A 21 year old cask of single malt whiskey for example is more scarce in availability and can typically be sixteen to eighteen times or more the
value of a fresh fill cask of single malt whiskey. Of course prices can fluctuate and the final sale price depends
on what the buyer is prepared to pay but generally the older the whiskey is the more expensive it is to
purchase and therefore the more valuable to own.
What size are the casks and how many bottles can one cask produce?
Typically you will purchase a 200 litre cask though the exact capacity of each unique 200 litre wood cask
can vary and it may be more or less than 200 litres. A 5 year old matured cask of whiskey once blended with water will produce around 380 bottles (70 cl) of whiskey. It is important to note that each year as the whiskey
in the casks matures a certain amount of whiskey evaporates naturally through the wood and this is known as
the “angels share”. The amount of evaporation can vary but it is estimated that around 4% of the whiskey is
lost in the first year and then about 2% (or a bit more) of the whiskey evaporates each subsequent year.
A 11 year old cask of whiskey for example could produce about 332 bottles (70 cl) whereas a 21 year old
cask for example may produce only about 240 bottles (70 cl) of whiskey but each bottle of whiskey will likely
be more valuable as it is older whiskey.
Is the demand for Irish Whiskey increasing?
In recent years there has been a significant increase in consumption and demand for Irish whiskey.
Sales of Irish Whiskey have grown tenfold in the USA since 2002. The Irish Whiskey Association predicts
that the Irish Whiskey Market will continue to grow and will surpass Scottish whiskey export sales to the USA
by 2030. This is one of the reasons which is influencing people to buy Irish whiskey casks as an investment
given the anticipated further increase in demand for Irish whiskey stock.
What is the difference between Scottish and Irish whiskey?
For whiskey to be referred to as “Irish Whiskey “ it must be originally distilled and matured in Ireland for
a minimum of 3 years. One difference between Irish and Scottish whiskey is that Irish whiskey is typically
triple distilled. Many think this makes Irish whiskey possibly smoother to drink than Scottish whiskey but it
is a matter of taste. The main difference is that Irish whiskey is distilled and matured on the island of Ireland!
It therefore has a unique identity and whiskey can only be called Irish Whiskey if it has originated from Ireland.
Can you explain the Cask Management & Trustee Service you offer?
We source Irish whiskey casks for private purchasers and private investors which have been distilled
at various distilleries in Ireland and or which are already available in bonded storage for purchase.
We make available to you a choice of whiskey casks for you to acquire. We typically recommend you purchase a single malt fresh fill whiskey cask. We will then acquire the whiskey cask on your behalf.
We can also quote for older whiskey casks. Once you have chosen the whiskey cask you wish to purchase and you have paid the amount due our company will proceed to acquire the whiskey cask(s) on your behalf and hold the casks to your order as your trustee and to manage the cask for you as the beneficial owner of the cask.
The whiskey cask will be stored duty suspended in a government regulated specialist bonded storage facility
in Ireland until the whiskey is matured to the age you require. You can then elect to sell the whiskey or use it
for your personal consumption. The casks will be insured through a specialist insurance broker.
Each cask acquired will have a unique cask reference number and which will be allocated to you as the
beneficial owner of the whiskey cask. The whiskey cask will then remain in storage until you decide when to
sell the whiskey or obtain it for your personal use. If you wish to take the whiskey cask out of bonded storage
for your own consumption or to bottle and keep on your own premises then duty and taxes will be payable.
The whiskey cask can be transferred to another duty suspended storage facility but the facility will need to be prior approved. A duty representative will be appointed to manage and ensure the payment of the duty and taxes that will be due on the casks once they leave the bonded warehouse. Please refer to our terms and conditions available on request which specifies in more detail the service we provide.
How do I know I am paying the right price
for a Whiskey cask and I am not being overcharged?
It’s a good question and an important one. We believe we source and make available Irish whiskey casks at the most competitive prices for private acquisition.
We also believe the storage and insurance fees and the cost of the cask management service we provide is extremely competitive.
In addition our cask management service is different in that we separate out and itemise the different costs so that you are fully informed of the costs breakdown.
The best way to find out however is to contact another company that offers Irish whiskey casks and ask for the total cost of acquiring a Irish whiskey cask including storage and insurance.
It is important that you ask for a like for like comparison and ensure that they are quoting you for a 200 litre single malt fresh fill Irish whiskey cask and inclusive of 5 years storage and insurance. We are confident that our costs will be very competitive.
Can I purchase whiskey casks myself directly from a distillery?
You can try! In many cases if a distillery or bonded warehouse is willing to sell you casks directly then it will
often be more expensive once you take into account the cost of the cask and transportation and storage.
Many distilleries and bonded warehouses won’t sell individual casks directly to members of the public because
of the cost of individual compliance administration. The service we offer is hopefully a cost effective and hassle free way of privately buying Irish whiskey casks. But again please check out the total costs offered by other parties and compare it to what we offer!
How many Whiskey Casks can I purchase?
If you are resident and based outside the UK then there is no limit in theory as to how many casks you can purchase and store. As the casks are stored in Northern Ireland then if you are based and resident in the UK HMRC may well categorise you as a revenue trader (and not a private purchaser or private investor) if you
own more than five casks and may require you to hold a license to store alcohol so if you are resident and
based in the UK you should limit your ownership to 5 casks or less.
Are the whiskey casks in storage insured?
Yes the whiskey casks are insured through a specialist whiskey insurance broker.
It covers against most typical risks but a copy of the policy coverage is available on request.
What choices do I have for the whiskey casks
at the end of the storage period?
At the end of your chosen storage period you have a few options. Firstly you can choose to keep the
whiskey casks in storage for a longer period and in which case we will quote you for the extended period. Alternatively you can decide to offer the casks for sale to another interested buyer.
Finally you can choose to take the whiskey out of the bonded warehouse and bottle and label it for your own private ownership and either consume it yourself or give it as a gift to family or friends.
If you decide to take the whiskey out of bonded storage then it will be subject to payment of the local duty and taxes applicable to whiskey being paid before the cask is released. A duty representative at the bonded storage will calculate the current duty rate and will release the casks on payment of the duty and tax amount due.
We can also quote you a fee for the labelling and bottling of the whiskey if you wish to take up this option.
It is important to remember again that an Irish whiskey cask must have matured for more than 3 years before
it can be categorised as Irish whiskey and made available for consumption.
GET IN TOUCH TODAY,
AND REQUEST YOUR FREE GUIDE
Investing in casks of Irish whiskey is rapidly emerging as a favoured option for both novice and seasoned investors. If you would like one of our team of experts to get in touch, or to request your free brochure please fill in our contact form or call us now on 03302 236836.
Important
To place an order with AELC Whiskey Cask Trustee Management Services (AELC Ltd), you must be 18 years of age or older.
AELC Whiskey Cask Trustee Management Services (AELC Ltd) does not possess expertise in tax or financial advice. If you require further clarification or guidance regarding the purchase of cask whiskey, we recommend consulting with your tax specialist or accountant.
We are not financial advisers. The information provided in our brochure and on our website serves the purpose of informing you about the Irish whiskey industry, enabling you to make an informed decision if you choose to purchase a cask. We suggest contacting your financial adviser as a primary step.
The value of cask whisky can experience fluctuations in both directions. If you have any inquiries concerning the cask buying process or any topics discussed in our guide or on our website, please do not hesitate to reach out to us.
If you intend to sample or bottle your cask, please note that duty and VAT will be required before the whisky can be bottled, and the responsibility for settling these charges lies with the cask owner. This process takes place after the finished goods are removed from the HMRC licensed warehouse.
It is recommended to conduct regular health checks on your cask every three years. Cask services such as regauging, samples, and photographs are billable to the client.