Industry

Drinks giant says rising thirst for whisky overseas may require more distilleries

By Peter Ranscombe June 3, 2012
Scotland on Sunday
FRENCH drinks giant Pernod Ricard will decide within the next nine months whether it will start building distilleries to cope with the rising demand for Scotch whisky in emerging markets.

Pernod - which owns Chivas Brothers, Scotland's second-largest distiller behind Johnnie Walker-maker Diageo - will next year bring its final mothballed distillery back into production.

Christian Porta, chairman and chief executive of Chivas Brothers, said the firm is on course to re-open its Glen Keith distillery on Speyside during March or April.

Last week, the spirits heavyweight - which makes whiskies including Ballantine's, Chivas Regal and the Glenlivet - also unveiled a £40 million plan to increase its output by 25 per cent over the coming financial year by extending four of its sites. Diageo last year opened a £40m plant at Roseisle, in Moray, to meet demand for Scotch in fast-growing markets such as Brazil, China and Russia.

Porta told Scotland on Sunday: "We look at the requirements of our brands over the long term every six to 12 months and, if we see that our brands are continuing to grow, then we will need to think what our next steps are. If we decide to go further, then possibly we would build a new distillery from scratch.

"That's not a certainty, that's not a decision we've made, but it's a possibility."

Porta added: "We have a good team on the manufacturing side in Scotland who are looking at different options, but we haven't started working up ideas for specific sites. If there is further acceleration in the growth of our Scotch whisky business then we will have to take a decision sooner rather than later. The next review will be in six to nine months' time and we will take a decision then about what the next steps are." As well as extending its distilleries at Glenallachie, Glentauchers, Longmorn and Tormore, Pernod is opening a further bottling line at its site in Paisley this summer to package its high-end whiskies, including Royal Salute.

Chivas Brothers already employs about 1,600 people at 32 sites throughout the UK, the vast majority in Scotland.