Whisky Myths Smashed #3
I’ve decided to write a controversial article for a change, and this one will definitely divide opinion. It would certainly be interesting to know the opinion of the people who follow this page, but please allow me to get my tin helmet on and get deeper into the trench.
One of the Scotch Malts of the moment I would say is Daftmill. I was given a sample of their third release, the Winter 2006 bottling of which only 1625 were made. To be honest, it smells as though it’s going to be a fantastic dram, and therefore I have bought a bottle for my collection. But to be honest, I don’t think this will be enough and I’m looking for another one for drinking.
Trouble is, this bottle is now pretty much only available on the secondary market, and now the price is rising rapidly. It’s in the territory that it may soon cost too much to drink if I obtain a second bottle. And here we come to the question – are collectors spoiling the market for those who choose to drink?? While I firmly believe this to be more myth than fact, there is evidence that some collectors are damaging the market. I’ll deal with those people later.
So why do I tend to believe that collecting doesn’t harm the drinking market? I’ll speak from the point of view that the majority of my collection was widely available at one point with the exception of say 10% of my bottles. And there is straight away the crux of my argument. The vast majority of them were at some point available at a reasonable cost. Therefore, a drinker has just as much opportunity to purchase these bottles as a collector. If a collector decides to put a couple of bottles away for a rainy day, that is his prerogative.
If a drinker does not have the savvy to purchase these bottles before they are discontinued then more fool them. A good case in point is Old Pulteney 17. These have been discontinued since 2018 and already prices are starting to rise. This is nothing to do with collectors pushing the price up, but more the fact it is a very decent dram, demand is high and thus begins the theory of the price being dictated by supply and demand.
A drinker has just as much opportunity to stow supplies away as a collector to ensure a continued stock of their favourite tipple. Plus, given the resources at everyone’s disposal nowadays, information on whether or not a dram is to be discontinued is usually available in the trade press or the multitude of whisky web pages.
When it comes to buying bottles at auction, not only is price dictated by supply and demand, it is also dictated by how much an individual wants that bottle at that time. Often bottles go above their true value due to people wanting to complete collections or somebody being inexperienced in auction purchasing. It’s also worth remembering that rarer bottles are sometimes bought at auction so they can take their place on the shelf of a whisky bar, where they are available to purchase, therefore drinkers do get a chance at sampling rarer Drams.
One follower of my WordPress blog, Tobi at Barleymania.com always seems to be trying older and exotic drams that have me salivating. I myself still purchase second bottles to drink if they are affordable. And here is the next point; some of the whiskies I collect would be out of reach for a normal drinker. Not many drinkers will pay £500 for a bottle for consumption. So how can I be, as a collector, of putting the cost of bottles out of the reach of the average drinker?
And this magic figure of £500 brings me to the start of my next point; some whiskies are not really meant to be drunk. Some are designed to be collectors items. Macallan would be the case in point. Remember the furore at their distillery when Genesis was released? It cost £495. Within a month, bottles were being auctioned for nine times that price, with the highest being that I saw £4500. The cause? Flippers.
Flippers are the people whom I believe to be causing the greatest damage to the secondary whisky market prices. That same bottle of Genesis can now be picked up easily for sub £2000. While the price may go up over time, due to the amount of people who have solely bought it as an investment, and the amount still trading on the secondary market, I believe it will be a few years before any significant rise is seen. If I was the person who paid £4500 (+12.5% for Commision and VAT which brings the true cost to £5062), I’d be very sick.
And it wasn’t just Genesis. Fast forward to the release of Macallan Easter Elchies Black 2018 (EEB 2018). Same story. Released at a price of £750, and in lower numbers than Genesis (1958 vs 2500 or so bottles I believe), the prices spiked at nearly £3000 within a short space of time. Now, prices can be as low as £800, which by time the seller has made the cost of shipping from Macallan to home and from home to the auction house, then the sellers commision, they’ve actually made a loss.
Yet again a similar story for Macallan Folio 4. Only £250. Yet the frenzy in the secondary market coupled with the crazy prices was like a pool of pirañas which hadn’t eaten for a month and a lamb falls in….
This just isn’t about the whisky. Macallan will price their products according to the cost of the ingredients. EEB 2018 at £750 would in theory have the most expensive whisky in it, yet because of packaging, Folio 4 which was a third of the cost of EEB 2018 yet has seen more consistent higher percentage returns. Genesis, also cheaper than EEB 2018 and had a greater outrun, is holding a better return. It is my belief that these whiskies are for collecting and not drinking. And it is with this I do have some sympathy for the drinkers who complain about collectors putting the prices up. £250 is affordable to drink, although on the upper end of the scale for many I would guess. People are actually just paying for the hype, the brand and the packaging. To be honest, although Macallan isn’t a bad whisky, there are better and more accessible malts. Tamdhu and GlenDronach would get my vote above Macallan, and in a blind taste test pre-Scotty’s Drams, I indeed did pick the GlenDronach Allardice compared to an 18 year old Macallan.
And paying that amount for a NAS whisky that few will ever drink is madness
And here is the last thing that drinkers have to suck up. If the bottles are getting cracked open, the availability goes down, especially in limited run bottlings. As more get drunk, and the supply gets less, the laws of supply and demand kicks in as rarity increases, and therefore the price. That’s an inescapable fact.
Before I close out this article, I’d like to say that as a collector, I do open the odd bottle here and there. My favourite collectable to drink is Bruichladdich Yellow Submarine 14 year old. I’m on my second open bottle, with three more to go. With a total outrun of only 12000 bottles, and only 3000 in the first batch (I have a couple of those), either way I’m contributing to the rise of the price, therefore would be castigated by a drinker who moans about the rising prices. A collector can’t win.
Yes, whisky is meant to be drunk, just as a car is meant to be driven. But you can’t accuse a millionaire that he is stopping you experiencing a Rolls Royce when his sits in a garage for most of the year. If you want to sip on rarer whisky, try visiting your local whisky bar. Yes, a dram will be more expensive, but it saves you from buying the whole bottle, and you can still have the experience. It’s like getting to drive a Lamborghini for a track day without associated overheads. I’ve did so for a 1938 Macallan. And again recently for a 12 year old Rosebank Flora and Fauna.
As for the Daftmill? I’m sure the Cuthbert family will be delighted this whisky has created such a stir, regardless if it is drunk or not, as this will secure future sales. It goes without saying that eventually there will be another Winter 2006 off the market as I succumb and pay the going price, but this one will be opened like many of the 1625 made already have. I plan to try and find a way to share this with some of my page followers as a reward for supporting my creative outlet. Keep your eyes peeled.
Do you agree or disagree with my sentiment? I invite comments from all sides of the argument, but as it is a slightly contentious issue, all I ask is that any comments are respectful.
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