Bloomberg Businessweek Europe - 23.09.2019

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In less than a decade, Japanese whisky has risen from relative
obscurity to the most sought-after liquor on the planet.
Much of that demand has been driven by U.S. and
European drinkers who, whether consciously or not, are
seduced by the mysticism of Japanese culture and are paying
top dollar for the expertise of the country’s famed craftsmen.
Last year the U.S. imported more than $40 million of the
spirit, according to the Distilled Spirits Council, up from
$6 million in 2014.
Behind the hype, however, lies an uneasy truth: Japanese
whisky doesn’t have to be made in Japan to be called such.
In fact, an alarming amount of it isn’t. “To say that whisky-
making regulations in Japan are loose is a major understate-
ment,” says Stefan van Eycken, author ofWhisky Rising: The
Definitive Guide to the Finest Whiskies and Distillers of Japan.
“If they were any looser, you’d be able to sell tap water as
Japanese whisky.”
Bourbon is required to be made in the U.S., and Scotch must
come from Scotland, but a bottler in Japan can wrangle its aged
spirits from elsewhere and still label it “Japanese whisky.” Now
that the designation carries more value than ever, a growing
band of opportunists are taking advantage.
It’s not uncommon to spot a newer brand offering
whisky with age statements older than the company itself.
Kurayoshi Distillery, for example, sells an 18-year-old pure
malt even though the distillery opened in 2017. When the
math doesn’t check out, you can assume some portion of
what’s in the bottle was imported. Van Eycken estimates
that around two-thirds of Japan’s producers don’t possess
distilling equipment.
Even the country’s largest producers have been caught off
guard by the rapid success of the category. Suntory and Nikka
Whisky—which control 80% of the market between them—
have had to eliminate age statements and are using younger
Japanese liquids in blends to keep product on the shelf. Suntory
discontinued its popular Hibiki 17 in 2018 in part because its
COURTESY BRANDSreserves were running low. As an extra stopgap, both have

DRINKS Bloomberg Pursuits September 23, 2019

released gins and vodkas to sustain interest in Japanese spirits

while waiting for the aged stock to return to its previous levels.

Much of what ends up in Japanese bottles is from Canada

and Scotland. According to the drinks analysis company

IWSR, Japan imported roughly 70% more Canadian whisky

in 2017 than it did four years prior. In that same period, retail

sales of bottled Canadian whisky in Japan were stagnant.

The Scotch Whisky Association records a similar phenom-

enon with its shipments to Japan, but on a larger scale. Bulk

exports of single and blended grain—the lighter, thinner spirit

that’s often viewed as filler against heartier, more robust

single malt—increased 141% from 2017 to 2018. Meanwhile,

Japanese markets showed no congruent rise in the sales of

bottled Scotch grain whisky.

Much of this practice is hidden in plain sight. Nikka pur-

chased a Scottish distillery 30 years ago and owns up to the

strategic advantages. “Most of our imported stock is coming

from Scotland since we acquired and restarted Ben Nevis

Distillery in 1989,” says Naoki

Tomoyoshi, head of international

business development at Nikka.

The company has been blend-

ing that into its Black Nikka Clear

range not to compensate for sup-

ply shortages, but because “our

style of production is based on

Scottish traditions,” he says.

This lack of clarity in label-

ing hasn’t been a problem inside

Japan, where most whisky is con-

sumed in highballs by salarymen at

izakayas after work. But for whisky

connoisseurs in export markets,

Japanese brands are beginning to

offer so-called international blends.

The Chichibu Distillery in

Saitama prefecture this year

released a $5,000 iteration of its

Malt & Grain “World Blended

Whisky,” which was named the

best limited-release blend at the

2019 World Whiskies Awards.

The label clearly identifies the

provenance of its many compo-

nents; Ichiro Akuto, owner and

master distiller at Chichibu, says the alternative is “whisky

laundering”—the deliberate misleading of consumers. Van

Eycken points out that the labeling isn’t a legal requirement:

“It’s a matter of honesty and transparency.”

Suntory, too, is joining the category with Ao, a blend that

combines mature spirits from all of the world’s major pro-

ducing regions: Japan, Ireland, Scotland, Canada, and the

U.S. The brand also labels its new spirit as a “World Whisky,”

though the packaging design still echoes Suntory’s standard

offerings with kanji and Japanese calligraphy. 

Behind the rise of

the “world blend” trend

By Brad Japhe

Your Japanese

Whisky May Be

Mostly Scotch

THREE WORLD

BLENDS

The Amahagan

World Malt ($200)

is smooth and

mellow. The label

describes the

spirit as a blend of

overseas whisky

and malt from

its Nagahama

distillery.

Suntory’s $200

Ao is finely

balanced, but a

slight suggestion

of peaty smoke

will likely appeal

more to a Scotch

fan than a

bourbon drinker.

Ichiro’s Malt &

Grain can range

from $130 to

$5,000 per bottle.

It’s less robust

than single-malt

fans may prefer,

but what it lacks

in heft it makes up

for in complexity.