Whisky 2020: Covid, Brexit & tariffs
“US tariffs, Brexit uncertainty and Covid‐19 have pummelled the Scotch whisky industry this year. After a record export year in 2019, there is no sugar‐coating the grave impact this year’s geopolitical storm has had on the sector.
Scotch whisky exports hit 1.31 billion 700ml bottles in 2019, a 2.4% rise on the previous year. By value, Scotch exports were worth £4.91bn (US$6.56bn) in 2019, according to HMRC figures released by the Scotch Whisky Association (SWA). However, the outlook for 2020 is vastly different.
“The collapse of global hospitality, tourism and travel retail as a result of Covid‐19 lockdowns, combined with the damage being done by the 25% tariff in the US, means we are expecting global exports to fall by around a third in 2020,” says Graeme Littlejohn, director of strategy and communications at the SWA. “The 25% tariff on single malt Scotch continues to cause the industry real damage. It has been in place for more than a year, costing the industry around £400m [US$535m] so far in lost exports. These losses disproportionately impact smaller producers, who only export single malt and for whom the US is a vital export market.”