The Single Malt Fund Trading Company

31 oktober, 2023

2023 – Q3 Whisky Investment and Market Report

Welcome to the Q3 2023 Single Malt Fund Trading Ltd report, where we comment on the latest developments in the rare whisky as well as broader industry markets and give an update on our trading operations. 

Industry news

The third quarter was a busy one for results announcements from the major alcoholic drinks producers. The big guns, Diageo and Pernod Ricard, published year-end results in August and September and the numbers were highly respectable. In the year to June 2023, Pernod Ricard delivered top line growth of 13%, with organic sales up by 10%. Diageo’s numbers for the same period showed an increase of 11% in sales with organic up 7%. Whisky featured prominently with both groups focusing on the health of the sector. At Pernod Ricard, Scotch was up 36%, Irish up 11% and Indian whisky up 10%, while at Diageo, Scotch sales grew by 12%, second only to Tequila. While Diageo mentioned premiumisation and brand strength as a key contributing factor, Pernod Ricard disclosed that price increases were responsible for 80% of their growth. 

From a geographical point of view, while Europe seems to be steady and there is a strong return of the Travel Retail channel, the dominant recurring news from the alcoholic drinks producers in the third quarter centred around slowdowns in the world’s two biggest markets, the USA and China. As well as Diageo and Pernod Ricard, LVMH, Treasury Wines, Beam Suntory, Remy Cointreau and Brown Forman all reported declines or significant slowdowns in the US. The main cause is the impact of inflation, which, it would appear, is hitting high earners more than anyone, as income growth lags cost of living growth. As a result people are cutting back on the finer things in life. The Wall St Journal went as far as to call this phenomenon, “a Richcession”. At the same time, all groups pointed out that China remains under similar pressure. The economy there is stagnating and the expected post-Covid recovery did not happen. With geopolitical events in Russia and the Middle East adding to the mix, prospects for the coming six to twelve months appear challenging indeed.

Auction update

How is the auction market doing in the current climate? Well, not surprisingly, we continue to see declines in the UK auction market and especially at the high end of the market. The RW Apex 1000 recorded its fifth negative quarter in succession in Q3, with the Icons and Japanese indices, which include the very top end of the market, faring worse than others. There were declines across most brands, with the exceptions being Bunnahabhain and Highland Park, who have grown by double digit so far this year. Glenfiddich is also doing well. Is this a sign that previously, dare I say, “dusty” brands are now coming back into favour while others are experiencing a downturn? Or is it just that the Chinese, who have dominated the auction market and have focused on a few top brands, are taking an extended break? 

Rare Whisky Q3 2023 results

Where does all this challenging news leave the Premiumization strategies that most major players have been talking about for the past two years? Has inflation and global events put paid to this trend? We tend to believe the new CEO of Diageo, Debra Crew, who said in her annual results statement that “Premiumization will continue”, and will even extend to other categories, such as Tequila. Pernod Ricard pointed out that their Prestige portfolio has grown by 22% in the past year, while at LVMH, the high value strategy with champagne is paying off. We believe that whisky and indeed other premium wines and spirits, that are limited in supply, will continue to appeal to an increasingly sophisticated and discerning consumer. Success will be down to brands and categories to deliver high quality products that appeal to the tastes of those customers. 

The Single Malt Fund Trading Activities in Q3 2023

The highlight of the third quarter for was the launch of our latest single cask exclusive bottling; a sensational Highland Park 18-year-old. This was a very exciting first exclusive partnership with The Edrington Group, owners of Highland Park, and of The Macallan for that matter. The content and marketing support that Highland Park have given us on this project has been tremendous. Thankfully, on their side, Edrington have been very impressed with our execution of this launch. As we move to the end of our second full year of trading, we take great pride in reporting this news. It took us a bit of time to convince Edrington to supply us. To now be working with and impressing them on an exclusive launch is a good indication of the progress we have made.


Ed Forrest
Managing Director – The Single Malt Fund Trading Ltd.

Dela rapporten

The Single Malt Fund AB (publ) 559118-4949

ISIN: SE0010547299

AIF-Förvaltare: Finserve Nordic AB

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