HONG KONG (Reuters Life!) - From ancient, windswept Scottish distilleries to the bustling neon-lit cities of Asia, the flow of fine whisky to the region has been steadily growing as Asians acquire a taste for the so-called water of life.
Not the easiest of drinks to appreciate with its strong, smoky aroma and high alcoholic content, Asians, particularly those in South Korea, Singapore and China have been increasingly drawn to the tipple, accounting for around 20 percent of the 3 billion pound ($5 billion) a year industry in 2008.
“It’s huge and vital. Asia is the future,” said James Espey, an industry veteran and founder of The Keepers of the Quaich, an elite clan devoted to promoting Scotch whisky heritage worldwide.
“Europe has plateau-ed, whereas America was the leading market for years, but then there was a white spirits explosion of vodka and rum,” added Espey who runs one of the world’s most exclusive whisky brands The Last Drop, which was rated “blended Scotch whisky of the year” in Jim Murray’s 2009 Whisky bible.
In Hong Kong, which has been gaining traction as an Asian wine hub after abolishing wine duties, auctioneers Bonhams recently held the city’s first ever whisky auction, putting up for sale part of the Willard Folsom collection, considered one of the best private stashes of rare whiskies in the world.
The sale, which attracted mostly Asian and Chinese buyers in a packed auction room, was 82 percent sold by lot in a sale worth around $70,000, though like many other places in Asia such as India and China, high import duties weighed on demand.
“Local collectors are willing to pay the 100 percent duty to secure fine and rare vintages. If (Hong Kong) creates a brilliant market development initiative as they did with fine wines a year ago, the whisky market could grow equally dramatically in Hong Kong,” says Colin Sheaf, chairman of Bonhams Asia.
In recent years, global thirst for rare, quality single malts has grown strongly, with an exceptional bottle of Dalmore Oculus selling for 27,600 pounds at an Edinburgh sale in November.
Other single malts with a cult following include Black Bowmore, whose 1964 first edition can fetch over 2,000 pounds.
Despite the hype, overall Asian whisky demand hasn’t yet sky-rocketed like wine and remains a much smaller market. Exports to Asia only grew from 524 million pounds in 1997 to 598 million pounds in 2008, according to The Scotch Whisky Association (SWA).
“Premium blended whisky brands like Chivas Regal & Johnnie Walker are doing very well (in Asia),” said Sukhinder Singh, director of the London-based Whisky Exchange.
“The malt whisky market will take time, but the people with disposable income are starting to try malts, and we as a business have some good private customers,” Singh added.
While demand in more mature markets like South Korea and Taiwan has been steady — in China, where single malt whiskies are often mixed with green tea and are popular prestige orders in karaoke lounges and clubs — the market has raced ahead.
According to the Scotch Whisky Association, 80 million pounds of Scotch were exported to China last year, an 80-fold increase from 2000, though the actual amount could be far higher with much also distributed via Singapore.
“Scotch in China is still largely consumed in major cities like Beijing and Shanghai,” said David Williamson, a spokesman for the Scotch Whisky Association.
“But with a whole range of metropolitan areas with populations larger than Scotland, whisky is set to grow in popularity so there are undoubtedly opportunities there.”
Despite the ramped up prices, experts say the value of rare whiskies, which can be opened and slowly drunk over years, is still cheaper than many vintage wines that have to be drunk in one sitting, making whisky a sound potential investment.
“This is an enduring quality category, which will be there forever,” said Espey who has begun to sell his $2,400-a-bottle The Last Drop blend to aficionados in Hong Kong and China.
“The patience, the peace, the tranquility. Scotch is unique. This industry is over 500 years old. There’s quite an art form to the production of it. It’s very quality controlled ... (and) that’s what makes it so special,” Espey added.
Editing by Miral Fahmy