5 Ways The Bourbon Boom Ends
Fred Minnick Senior Contributor
I cover spirits, the drinks culture and business.
Bourbon is enjoying an unprecedented rebirth with the brown spirit's narrative transcending people just drinking the stuff.
Two glasses of whiskey with ice hit and break, pouring a lot of spray and drops
Today's bourbon world includes lifestyle and tourism elements that old timers never would have dreamed of. For Kentucky alone, distilling powers a $8.6-billion economic output which has led to both undergrad and graduate courses on bourbon as well as degrees related to the bourbon business.
But this boom does have threats. And for an industry that suffered through Prohibition, distillers constantly worry about their non-bourbon enemies, which have historically included everyone from beer brewers to axe-wielding temperance women. The threats that could take bourbon down today are real, and some may surprise you.
5. Tariffs / international conflict. Bourbon's enjoying more than $1 billion in exports, and it's taken the industry nearly 60 years to reach this point. After World War II, foreign tariffs on bourbon were as high as 400%. Bourbon slowly peeled away those tariffs, but now foreign governments are attacking bourbon in retaliation against President Trump's steel tariffs. These tariffs are costing Brown-Forman alone $125 million a year. If these tariffs continue, they will greatly damage bourbon's international presence.
In addition, the international scene is greatly impacted by war. Bourbon has suffered during past world wars, when the government requested distillers solely produce industrial alcohol rather than spirits. Of course, if we face World War III, bourbon's fall will be the last of our worries.
4. People stop drinking. There's a growing trend of young people forgoing drinking alcohol for health reasons. Despite studies showing that moderate drinking can be a part of a healthy lifestyle, health zealots are leading today's temperance charges in much same way as women like Carrie Nation in the early 1900s. Rather than religion, these people are citing studies that are often chastised by health professionals. In anticipation of this trend, alcohol companies have started investing in non-alcoholic spirits, which somehow makes perfectly good sense in this day and age. Furthermore, the growth of a legal cannabis industry has many spirits insiders concerned about marijuana's threat to the good stuff. (Listen to the author's Bourbon Pursuit podcast on the influence of cannabis in bourbon.)
3. Scandal. Bourbon's been caught up in its share of national scandals. From President Grant's alleged involvement in the Whiskey Ring to the 1940s price fixing scandals that had the Department of Justice chasing distillers, bourbon equals big money and significant tax revenue. If a major distiller (or string of distillers) was caught defrauding the government out of tax monies or executing an illegal pay-to-play scheme, the industry would suffer greatly. The government would likely respond by imposing sanctions and the consumer base would lose faith in their beloved distilleries.
2. Major accident. Recent warehouse collapses at Barton and OZ Tyler really shed light on safety concerns. Any injuries sustained during a distillery tour, whether a warehouse collapse or a pipe explosion, would forever alter distillery tours. Government regulation added to what has been a pretty relaxed experience could keep tourists from visiting.
1. Bourbon bickering. The greatest threat to the bourbon industry is bourbon itself. Bourbon Hall of Famer Chuck Cowdery once wrote that bourbon tends to think too small. If and when bourbon brands stop working together for the greater good, fighting over a piece of the pie vs. making the pie bigger, other spirits categories will seize the opportunity to steal their customers. Perhaps it's inevitable, but the territorial fighting, such as Bardstown vs. Louisville, will only destroy what so many have tried to build. Regional leaders and distillers would be smart to work together in an effort to improve legislation for their common interests, grow tourism opportunities and continue making quality product. If they do, then bourbon will likely enjoy another 20 years of growth.
Fred Minnick is the author of Bourbon and editor-in-chief of Bourbon+ Magazine. Follow him on Instagram.
Fred Minnick
After serving in Iraq, I discovered a career in bourbon, where I followed distillers and broke news in a category blossoming before my very eyes. This passion led to my ...