In high spirits: Midleton Distillery gets a €250m investment
Irish Distillers announced on Monday that it is to invest €250m to build a new distillery on a 55-acre site at their existing plant in Midleton, Co Cork.
There is no denying these are turbulent times, and so there was an especially warm welcome for the announcement last Monday by Irish Distillers that it is to invest €250m to build a new distillery on a 55-acre site at their existing plant in Midleton, Co Cork, on the back of the continuing growth in sales of Irish Whiskey worldwide.
As the details were parsed, that welcome grew warmer still. Architectural drawings reveal a gorgeous new edifice, a sweeping curve of stone and glass through which giant copper whiskey stills will be clearly seen.
The building will blend into the rural landscape, visible to all traffic on the main eastern approach into the town, and can only add to further to the allure that has made the Jameson Midleton Distillery one of the top Irish tourist attractions, in addition to producing litres of whiskey each year.
It is anticipated the new distillery will generate 100 new high-end production jobs and up to 800 construction jobs over the three years of building works to have it operational by 2025, to coincide with the historic distillery’s 200th anniversary.
The resulting boon to the local economy will be further elevated by a 50% increase in the Midleton plant’s barley and malted barley requirements, all to be sourced from Irish farmers.
The news arrived not long after the announcement that Jameson whiskey, all produced at the plant, had sold over 10m cases (9l in each case) worldwide, and Irish Distillers chairwoman and CEO Nodjame Fouad, said on Monday that the newly planned addition was a “recognition of Midleton Distillery as the beating heart of Irish whiskey”. Whisper it, but are we finally on the way back to the top of the global whiskey market, a crown lost almost a century ago?
Kevin O’Gorman is the master distiller at Midleton. He joined the company and began working in the East Cork plant in 1988, assuming his current role in 2020, only the fourth master distiller at Midleton in almost 80 years.
“I’ve been in Midleton since ‘88,” says O’Gorman, “but this was a special day, talking to all the staff and locals, it is a seal of approval on Midleton. Everyone is so proud, it was a significant announcement, a major investment and a momentous day.
“In terms of tourism, we’re also doing a €13m investment on our heritage centre to be ready for 2025 and Midleton is already a thriving town, with pubs, restaurants, great food, but this is going to add even more to it.
Crucial to the current expansion is one particular whiskey from the substantial range produced at Midleton: Jameson, which now accounts for two out of every three bottles of Irish whiskey sold around the world.
Acclaimed whiskey writer Bill Linnane says: “The new distillery is incredible in the context of just how big Midleton distillery already is. In the Garden Stillhouse, they have six of the biggest stills in the world, and four more in the Barry Crockett Stillhouse, and that’s before you even consider their capacity to make single grain spirit.
“The place is a powerhouse, and yet even though they can distill 64m litres of pure alcohol per annum, it’s not enough.
“The key to this demand is really all down to one brand, Jameson, and it’s really it’s all about Jameson sales in America.
“There has been a lot of talk about the rising tide lifting all boats, but the gap [in US sales] between Jameson and all other Irish brands is massive.”
It is believed the Moors invented distilling around 900AD, though only to produce medicines and perfumes, and when they were driven back out of Europe, the know-how passed on to the monasteries.
The monks — already dab hands at turning out beers — were certainly not averse to a jorum, and used this knowledge around Europe to produce distilled alcoholic beverages, universally translating as “water of life”.
The Irish and Scottish have long haggled over who first produced “uisce beatha” (Irish for “water of life”; “uisge beatha” in Scots Gaelic) from which the word, whiskey (or whisky, without an “e” if it’s Scotch) is derived.
Bragging rights are currently on this island, with the earliest mention on record dating back to 1405, in the Annals of Clonmacnoise, recording the mother of all hangovers, stating that: “Richard Magrannell Chieftain of Moyntyreolas died at Christmas by taking a surfeit of aqua vitae (Latin for “water of life”). Mine author sayeth that it was not aqua vitae to him but aqua mortis.”
Certainly, there was huge monastic traffic back and forth between Ireland and Scotland around this time but, no matter whomever first “discovered” whiskey, the Irish soon had the upper hand and by 1541 Queen Elizabeth I was publicly declaring her preference for the drop of Irish “aqua vitae”, superior to any English or Scottish distillates, and making it her court tipple of choice.
By the beginning of the 20th century, there were distilleries all around the country and Irish whiskey was the best-selling whiskey in the world, with a global share estimated close to 80%, and the best-selling whiskey in the US.
The four major Dublin distilleries — John Jameson, John Power, William Jameson, and George Roe — had an annual capacity of 5m gallons each year (over 2.25bn litres!) and almost 40% of the capital’s workforce were employed in brewing or distilling.
Cork, Derry, and Belfast were the other major distillery hubs, with Cork Distilleries operating out of the North Mall and Midleton distilleries.
In 1920, the arrival of prohibition in the US saw the banning of all alcohol sales, a gap in the market almost immediately plugged by the infamous “bootleggers” illegally trafficking alcohol into the country.
But the War of Independence in Ireland meant Irish exports were shut out of British Commonwealth markets, including Canada and Bermuda, both ideally positioned to act as “supply depots” for the illicit US market.
Scotch soon became the speakeasy whisky of choice, even more so when crude imitations of still in-demand Irish whiskey — made from dyed raw alcohol — further alienated US imbibers.
The impact on the Irish industry was profound and when prohibition was rescinded in the US, in 1933 (the year after the beginning of the six-year Anglo-Irish trade war, further reducing Irish exports), infrastructure was no longer in place to return to pre-prohibition production. And, to put a cap on it, almost literally, an impoverished Irish State limited whiskey exports, to increase lucrative tax take from domestic sales.
Where there was once close to 40 Irish distilleries at the peak, by 1972 there was only Irish Distillers, an amalgamation of several of the old Irish distilleries, distilling only in Midleton and the Bushmills distillery in Co Antrim.
Though one of the pioneers of the modern Irish whiskey revival, Midleton master distiller Barry Crockett endeavoured to keep a guttering candle alight, Irish whiskey sales in the US at one stage in the 1980s fell to a mortifying 200,000 per annum.
Irish Distillers may have had a monopoly on Irish whiskey, but it might as well have been stockpiling banknotes fromthe board game. Dublin-born businessman and academic John Teeling was the man who upended the board and broke the monopoly.
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An ancestor of Teeling’s, William Teeling, had owned and operated a distillery in Dublin in the 1700s and John Teeling wrote academic papers on the dramatic decline of the Irish whiskey industry while studying for a doctorate in business studies at Harvard in the 1970s.
In 1985, he launched the Cooley Distillery and over the next decade built it up into a highly credible business, winning prestigious awards and popular acclaim for the whiskeys and eventually selling the business in 2012 to Beam Inc for €71m.
His son, Stephen Teeling — who, with brother Jack, owns and operates Teeling Whiskey, in Dublin — says: “My dad said in the 80s, you almost couldn’t give Irish whiskey away — there was a perception that it just went into Irish coffees, there was a very poor job of marketing it outside Ireland.
“But he knew well from his studies that it was once the dominant global whiskey and that there was huge potential.”
Shortly after Teeling opened Cooley in 1985, a beleaguered Irish Distillers, beset by circling corporate raiders, was rescued by Pernod Ricard, in a white knight takeover, providing the Irish company with financial backing and, crucially, an enlightened level of operating autonomy.
When Pernod Ricard took over, Irish Distillers was selling just under 500,000 cases per annum; the leap to 10m cases for the 2022 fiscal year confirms the investment was sound, repaid in spades.
As the company’s revival spurred renewed pride and interest in Irish whiskey, and also encouraged by the welcome afforded the burgeoning craft beer sector, other new independent Irish distilleries began to spring up around the country, with craft brewing pioneer, the late Oliver Hughes (The Porterhouse), also setting up Dingle Distillery. There are now over 40 distillers around the country, and Kevin O’Gorman and Irish Distillers aided many of them in the early days, offering workshops and sharing knowledge.
The Teeling brothers immediately set out to bypass the entry-level blended offering and target the premium end of the whiskey market and last year, Teelings sold over 1.2m bottles of their multi-award winning whiskeys in over 70 countries and expect to welcome over 100,000 visitors on their Dublin distillery tour this year.
“The category has evolved even in the last 10 years,” says Teeling, “I wouldn’t say back then the choice and breadth was what it needed to be, and it allowed us to go out and target the premium and super premium.
“Jameson was blazing a trail but all about the same price point and we saw an opportunity to take a different approach with something a bit more modern, a different product.”
In a traditionally male-dominated industry, Irish Distillers has been to the fore in introducing women to prominent positions in the industry.
Limerick woman Deirdre O’Connell arrived in 2012 as part of its graduate programme and is now a blender, working alongside master blender Billy Leighton.
Katherine Condon, from Ballinascarthy in West Cork, is a distiller in the main plant working with Kevin O’Gorman, while 25-year-old Eva O’Doherty, from Ashbourne, in Co Meath (who graduated first in distilling and in brewing in her DIT class), is head distiller in the Midleton Distillery’s “Method And Madness” micro-distillery, a hub for creative experimentation, innovation and product development, and a standalone brand in its own right.
“For me, to come in here and see all these women and their positive impact has been inspirational,” says O’Doherty.
“I was drawn to the sector by the science initially, how the sector was booming across Ireland, and the real opportunity for innovation and creativity.
“There is so much going on: Brewing, fermenting, distillation cuts, barrels, and so on; [laughing] you need to be good at multi-tasking and women are great at that!”
O’Doherty’s enthusiasm for her profession also reflects another driving force behind the resurgence of Irish whiskey: The growing cohort of younger consumers.
Conor McGregor’s involvement in Proper No Twelve, the third-best selling Irish whiskey in the US, which he and his partners sold last year in a deal worth up to $600m — making him the highest-earning sportsman in the world, passing out Ronaldo — has attracted young drinkers all around the world.
The Jameson RTD (ready to drink, pre-mixed Jameson cocktails, such as cola flavour or ginger & lime) market are big sellers and one in every two drinkers of the very cocktail-friendly Jameson Orange is new to the brand, all facilitating the step up to Jameson itself and eventually, fingers crossed, the premium or prestige brands.
Eva O’Doherty very much registers the change in her own peer group: “My friends drink them all the time. Most of them are female and they all took them off to Electric Picnic and they love their Jameson and 7Up; I love making whiskey sours with [Jameson] Black Barrel, so good!”
“Pernod Ricard has done a phenomenal job in rebranding Jameson as a younger person’s drink,” says Stephen Teeling, “and there’s huge interest abroad and here from that age profile, in Irish whiskey in general, young people drinking and even working in whiskey, saying, ‘Whiskey is pretty cool, not like my grandad’s drink’. There’s a totally different vibe to it all.
“Premium spirits and brown spirits are on a massive growth spurt world wide. Irish whiskey sales are about two years away from matching Scotch single malt sales worldwide.”
It won’t all be plain sailing ahead. Rising energy costs are impacting on production costs and the astronomical leap in the cost of global shipping, crucial to the export model, will also come into the equation.
Russia’s invasion of Ukraine, and the subsequent trading ban, has cut the legs from under the Irish Distillers’ Russian market, responsible for 15% of their growth in world wide sales since 2016, roughly 7m litres, comfortably more than is sold in each of the traditionally strong markets such as Ireland, Britain, and France.
International research company Euromonitor reckons Irish whiskey is still in the early stages of becoming a truly global brand and there may well be a slowdown in the next year or so, but despite the challenges, opportunities also lie ahead in emerging markets, Asia, in particular.
“Jameson is growing 22% on the previous year,” says O’Gorman, “and our prestige portfolio — Midleton, the [Green, Blue, Yellow, Gold etc] Spots, Knappogue, Redbreast, Method And Madness — is growing 16%. Our roadmap is to get to 15m cases by 2030, so the new distillery is on that roadmap.”
“You have to take the long-term view in whiskey,” says Stephen Teeling. “If you worry about the peaks and troughs in between, then you shouldn’t be in the whiskey business.
Last word to Bill Linnane who, it is worth noting, other than being one of the very best whiskey writers around, grew up in Midleton, now living in a house overlooking the distillery: “Midleton is very much the engine driving Irish whiskey, and I hope this new distillery, along with the massive overhaul of the tourism side of Midleton Distillery will open people’s eyes to how important the place is, and Midleton will be seen for what it is; the home of Irish whiskey.”
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