Roll out the barrel

Self-styled ‘seasoned whisky expert’ Jass Patel of Tamoka Casks began a recent article in the Independent with the heartening tale of Roger Parfitt. The retired bank manager from Coventry apparently bought two whisky casks for £4,700 in 1994 which he then flogged for £220,000 thanks to one of them being Macallan. Apparently, this earned him a return on investment of 4,600 per cent, which is peanuts compared to what he could have made from the lottery.

The subject is gaining plenty of coverage in the mainstream media, which happily provides platforms – presumably unpaid – to ‘seasoned experts’ to enthuse about ‘the complex yet highly lucrative world of cask whisky’, to quote Tamoka’s website. But not everyone is convinced. In a scathing exposé in Cask & Still magazine, whisky consultant and author Blair Bowman talks of ‘a train crash waiting to happen in the world of whisky cask investments’.

Geoff Kirk, Macallan’s head of private client management, says: “We have seen in recent years the chatter about the returns from cask investment, and a lot of it is based on slightly false data. We look at it with healthy scepticism.” Judging by the height of his raised eyebrow on our Zoom call, that should read scepticism.

Having been contacted by the Advertising Standards Authority, Blair Bowman tells me that his “plan of attack is to get the ASA to acknowledge that any adverts on social media or print that mention ‘No capital gains’, ‘tax free investment' or ‘586 per cent ROI’ etc should be banned.” That last, widely quoted figure, refers to an index of the rarest and most sought-after bottles collated by the analyst and broker Rare Whisky 101. Note the word bottles, not casks.

Recalling his days at Berry Bros. & Rudd, David King, now Gordon & MacPhail’s sales director, says: “Simon Berry always used to say: ‘Wine’s a great investment, but even if you don’t make money, you can always drink it’.” The same is true of whisky, though it is hard to imagine the committed speculator savouring the flavour and bouquet of a devalued dram.

Gordon & MacPhail sells casks to private clients, or rather the outturn of a cask in its own bottles, as does Diageo through its Cask of Distinction (COD) programme. That the drinks giant bothers with single casks, when its day job concerns huge brands like Johnnie Walker, just goes to show the value involved. Diageo’s casks, it should be noted, are mostly over 21 years-old and hand-picked by its four master blenders.

“We’ll never endorse whisky as an investment,” says the firm’s head of rare & collectible spirits, James Mackay, in contrast to Simon Berry. “The way we approach it is to have a much deeper level of engagement over a long time with a real whisky aficionado.” To enhance the sense of it being a unique experience is key, clients can choose an artist to paint them the cask end.

THREE TYPES OF CLIENTS

No such frills are available to those purchasing a cask from the Borders distillery in Hawick, but the price tag is a more accessible £1,995, which includes warehousing and insurance for the first 10 years. Then comes a painful reckoning with the tax man of about £3,400 in duty and VAT at today’s rates before you get your hands on around 270 bottles of something totally unique.

According to the distillery’s co-founder and director John Fordyce, there are three types of clients – whisky enthusiasts, syndicates of friends or colleagues, and grandparents. The latter “need to buy gifts for their grandkids like in the old days when you would buy a case of port or a bit of en primeur,” he explains. “The motivation for most of our people is that it’s a bit of fun.”

A limit of 1,837 casks has been set – 1837 being the year the last distillery in the Borders closed, and sales are “rocking along at a steady kind of pace”, says John. Meanwhile, Simon Erlanger, director of Isle of Harris distillery, has done four cask releases to date, ignoring the advice of Anthony Wills of Kilchoman who told him not to because “it’s murder managing the thing.”

On that point, Simon doesn’t entirely disagree, but he does cherish having a band of loyal fans who have bought a cask for the right reason, namely passion not profit. Each has to sign a contract vowing not to sell the whisky for financial reward.

Yet private casks are sold for all sorts of reasons and thankfully not just through the soulless investment schemes that concern Blair Bowman and others. Maybe the benefactors of that generous grandparent mentioned earlier are not into whisky, or those buying the cask forgot about the hefty tax bill and costs of bottling. Perhaps they have neither the space nor the appetite for over 20 cases of Scotch, or sufficient friends and family who would truly appreciate them.

ABOVE: Society spirits director, Kai Ivalo

If you are one of the above, the Society would love to hear from you. This is nothing new, as Kai Ivalo, the Society’s spirits director, explains: “Every year we buy casks from members and it’s been a good supply of some interesting stock that otherwise might have been quite difficult to get hold of.” He and his colleagues clearly know the market and current prices, though naturally anyone selling might want to get a number of quotes.

All things being equal however, it seems people are happy to share a cask they have bought or inherited with fellow members who will really value the whisky. “We’ve done a number of deals where we’ll say: ‘We’ll give you a couple of cases of the finished product’,” says Euan Campbell, the Society’s spirits manager. In other words – it’s a case of payment in cash and kind.

Every single cask whisky that is enjoyed as a drink, bought direct from a distillery or The Scotch Malt Whisky Society, has an added bonus. It means one less cask in the hands of some spreadsheet-driven ‘seasoned whisky expert’. That’s got to be a good thing.