Behind The Great American Whiskey Shortage

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Why You Should Relax, Because Most Of Your Whiskey Is Perfectly Safe

By Richard Thomas

The last few weeks have seen a new spate of stories coming from across the mainstream media proclaiming that a “Great American Whiskey Shortage” is just around the corner. The scary headlines conjure time warped images of store shelves as barren as those found in Minsk, circa 1986.

Yet the same mediaoften the very same media outlets, in factpredicted this shortage last year, as well as the year before that. After watching reporters cry wolf for three straight years, those with long memories have become skeptical, and it has become fair to ask what, if anything, is behind these whiskey shortage stories.

The Genuine Shortages
Thus far, whiskey drinkers have experienced only one example of a genuine whiskey shortage, this being when the craze for rye whiskey caught the American and Canadian industries off guard and rapidly overwhelmed supply. That saw premium rye whiskey brands wiped off the shelves wholesale, and even standards like Old Overholt were sometimes scarce.

Past that, the facts have pointed to particular hiccups and not widespread unavailability. To relieve supply pressures, many brands in both the U.S. (and Scotland as well) have moved away from aging statements, while Maker’s Mark infamously flirted with cutting the proof of its bourbon to meet demand in 2013.

This year the weather combined with a variety of economic factors to crimp the supply of wood for the new oak barrels so much of the American whiskey industry depends on. Yet as real as the problems with the oak timber supply are for this year and the next, the picture painted by the media was much bleaker than anything the facts could support. Indeed, frightful headlines left largely unsupported by the story beneath are the defining feature of the entire whiskey shortage meme.

No Shortage Of Yellow Journalism
Almost all of this most recent wave of whiskey shortage stories quote only one source, Buffalo Trace. The Frankfort, Kentucky distillery has issued regular statements over the last few years about its supply problems with the intent of keeping their consumers informed, but these press releases seem to have instead become something for the mainstream media to seize upon as the basis for repeated waves of scaremongering.

Buffalo Trace is coming late to expanding their production capacity so as to meet the rising demand, breaking ground on their expansion project only this past April. Similarly, the supply crunch Maker’s Mark found itself in last year was the logical outcome of the long postponement of their second major expansion project.

Maker’s Mark’s and Buffalo Trace’s difficulties do not translate into the wider Kentucky bourbon industry because Jim Beam and Wild Turkey have completed major expansions and report that they are on top of demand, while Heaven Hill is already in the midst of a major expansion. New players such as Willett and Michter’s are either already producing or soon will be, and America’s largest whiskey producer, Jack Daniel’s, is staying on top of the global thirst for its products just fine.

Don’t believe the hype, because it is 100% yellow journalism. Insofar as real scarcity goes, the media actually caused a temporary bourbon shortage all on its own earlier this year, when Esquire‘s Josh Ozersky article about how W.L. Weller 12 Year Old (among others) was a worthy substitute for the elusive Pappy Van Winkle bourbons was picked up, repeated ad nauseam, and caused a run on Weller. The stories of an American whiskey shortage are not just old hat and ill-informed, but also lazy, since most of the recent stories completely overlooked the Maker’s Mark episode, even though it occurred only a year ago.

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4 comments

  1. The Whisky Advocate blog has an eerily similar photo to yours in a post today that argues against what you’re saying here.

    whiskyadvocate.com/whisky/2015/02/27/there-is-a-bourbon-shortage/

    • And they didn’t credit the photo source like I did. Tsk Tsk!

      Chuck Cowdery produced the first, counter-poise blog arguing that the shortage is a mirage, and Minnick’s piece is far more reasonable than what the mainstream media, such as Minnick’s friends at the Wall Street Journal, usually produce on the subject.

      The first thing to understand is that when I think shortage, I think 1970s gas lines and wartime rationing, not moderate price hikes and minor inconveniences.

      The second thing to understand is that not every example of a shortage (however you define it), and this is something Minnick clearly does not see, is due to straight demand. Weller 12, one of Minnick’s specific examples, is under strain because of a media-inspired run on it. I discuss that above.

      Other examples, including some of the brands that have gone NAS, are due to aged stock from the bourbon glut era running out. That was going to happen sooner or later anyway.

      Minnick also points out how industry people sometimes ruminate, vaguely and in the background, about shortages. It’s true and they do this with me as well. That is completely outweighed by the way they speak openly, in public, on the record and frequently on their fear of winding up with a sea of leftover whiskey if the boom should suddenly collapse. People who are truly fearing a major supply problem don’t fixate on things like that as much as they clearly do.

      The final note I want to make is that people trained in statistics will recognize that while Minnick’s survey is interesting and has value, it was not scientific (this based merely on the facts of the survey as he describes them) and therefore not in any way truly conclusive.

      On his own blog, Minnick recently seized on what is clearly just a repackaging of the annual Four Roses Single Barrel Limited Edition series, a series that has been growing in size over time, as an example of the “shortage.” My own opinion is that he should take a step back and absorb a wider body of evidence if he is actually interested at getting to the truth. The bottom line here is that limited edition brands will obviously become more scarce, and some brands have experienced a real supply pinch, but we simply are not going to wind up in a place where the bourbon industry has to choose between letting people go thirsty or sacrificing quality on a large scale basis. There will be no 1970s gas line-style situation for bourbon.

  2. It makes sense that they would steal from something better, doesn’t it?

  3. I read the link, and that guy wants to have it both ways. He wants to scare us while sounding reasonable. It’s the “no stones” approach.

    A few bounces in the road do not a shortage make. Sorry there, guy.

    I’m starting to go from liking this Whiskey Reviewer website to loving it, and it’s because of things like this. It really smacks you in the face.

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