Canadian Whisky Builds Value With A Focus On Rye

While tapping into growth with flavors Canadian whisky is also building value by leveraging its strength in the rye segment. Diageo-owned Crown Royal’s first rye edition—Crown Royal Northern Harvest Rye ($29.99)—was launched in mid-2015 and sold around 100,000 cases by year-end. This past spring, Crown Royal also rolled out Cornerstone Blend ($60), the first release in its Noble Collection.

Beam Suntory, meanwhile, debuted Canadian Club 100-percent rye in May ($18-$20). “It’s our biggest growth driver right now,” says Nathalie Phillips, marketing director, world whiskies at Beam Suntory. “Whenever possible, we place it in the rye section rather than the Canadian section at retail. As younger consumers peruse whiskies, they’re not necessarily going straight to the Canadian section. They’re more interested in the overall rye category.”

Beam Suntory used a similar strategy when launching its Alberta Rye Dark Batch whisky (roughly $30) in 2015, and the company has a merchandising program, called I Heart Rye, which encompasses its entire rye portfolio. “We display each of our different ryes from the United States and Canada, organized by flavor profile and signature cocktails,” Phillips explains.

“People want heavier, more robust whiskies these days, and Canadian whisky is adapting with more rye-forward offerings,” says Don Livermore, master blender for Pernod Ricard’s J.P. Wiser’s, Lot 40 and Pike Creek brands. “We’re increasing our focus on Lot 40, starting in Michigan and Illinois,” adds Lot 40 business leader Gerard Graham. “And Pike Creek is the perfect introduction for consumers looking to trade up from mainstream whisky offerings.”

Among craft spirits, some of the more successful brands of recent years are Canadian whiskies—often comprising 100-percent rye—that have been bottled by American companies such as Vermont-based WhistlePig. Oregon’s Hood River Distillers launched the Pendleton brand in 2003, while Sonoma, California-based 3 Badge Beverage Corp. debuted Masterson’s rye whiskey in 2011. Those companies source whisky from unnamed Canadian distilleries.

“The Canadians have always made good rye,” says Ryan Maloney, owner of Westborough, Massachusetts-based Julio’s Liquors. “When rye started heating up, Canada became the place to get really good stuff. It’s still an untapped resource.”

Julio’s recently sold out of a single barrel of Masterson’s at $69.99 a 750-ml. and currently offers a single barrel of Sazerac’s Caribou Crossing ($54.99 a 750-ml.) Maloney cites Pendleton ($24.99 to $129.99), Forty Creek ($24.99 to $69.99) and Lot 40 ($49.99) as other top-selling rye brands. He adds that the store has expanded its SKU count in recent months due to the influx of new, high-quality entrants in the category, including Pendleton Directors’ Reserve ($129.99), a 20-year-old Canadian whisky.

Rémy Acquires Seattle Single Malt Producer Westland Distillery

Rémy Cointreau has entered the U.S. market’s craft spirits segment, acquiring Westland Distillery for an undisclosed price. The Seattle-based Westland is known for its portfolio of high-end single-malt whiskies, which range in price from around $70 to $125 a 750-ml.

As SND reported earlier this year, Westland—a leader in the emerging American single malt whiskey category—has been expanding its lineup via new product activity.

With single malt whisk(e)y thriving in the U.S., Rémy is aggressively building its presence in the segment. The French drinks group purchased Islay’s Bruichladdich for $90 million in 2012, and last month it entered into exclusive negotiations to purchase French single malt producer Domaine des Hautes Glaces. Rémy says the Westland deal is expected to close by year-end, and that the Domaine des Hautes Glaces transaction may also be completed by then.

News Briefs:

•As part of its ongoing Top 100 Wines of 2016 celebration, Wine Spectator has unveiled its number-six and number-five wines of the year. Number-six is a gem from one of California’s most influential and innovative winemakers, while number-five is a top-flight Barbaresco from the 2011 vintage. Wine Spectator's Top 10 wines of 2016 are being revealed over the course of this week at http://top100.winespectator.com/ and the full Top 100 list will be released on Monday, December 5.

•A class-action lawsuit was quietly filed on November 18th alleging that Buffalo Trace Distillery, Old Charter Distillery Co. and parent company Sazerac Co. have deliberately misrepresented Old Charter 8 as an 8-year-old Bourbon. The suit was filed in the U.S. District Court for the Southern District of New York by Nicholas Parker on behalf of himself and others who have purchased Old Charter 8. It alleges seven counts of deceptive acts or practices, false advertising, unjust enrichment, breach of warranty, fraud, and negligent misrepresentation and seeks compensatory, statutory, and punitive damages, as well as to put a stop to the “illegal practices.” Whisky Advocate has more.

•Riboli Family Wine Estates has extended its San Simeon wine brand with Stormwatch, a super-premium red Bordeaux blend. Sourced from Paso Robles, California, Stormwatch ($70) is comprised of 47% Cabernet Sauvignon, 21% Merlot, 16% Malbec, 11% Petit Verdot and 5% Cabernet Franc and is matured in French oak barrels. It marks San Simeon’s first Bordeaux blend and joins the brand’s existing lineup of Syrah, Chardonnay, Cabernet Sauvignon, Viognier, Petite Sirah, Pinot Noir and Merlot offerings.

•Los Angeles-based alcohol delivery company Saucey has partnered with retailer BevMo for expanded service in the San Francisco, Los Angeles, San Diego and Sacramento areas. The partnership gives Saucey’s customers an expanded selection of products, increasing from an average of 950 products in a delivery area to more than 9,500, the delivery company says. Launched in 2014, Saucey offers its own app for ordering and enlists retail partners to supply product, but unlike rivals Drizly and DrinkFly, Saucey maintains its own fleet of 1,500 delivery couriers. Meanwhile, Saucey has brought on former BevMo CEO Alan Johnson and former Albertsons CIO Patrick Steele to its board of directors. In addition to California, Saucey is also present in the Chicago market.

•Pabst Brewing Co. has named veteran beer executive Simon Thorpe as CEO. Thorpe was most recently president of Duvel Moortgat USA, and also headed InBev USA from 2002–2007. Eugene Kashper, who partnered with TSG Consumer Partners to acquire Pabst in 2014 and has served as chief executive, will remain chairman and continue to be actively involved in the business.

Craft Brewing And Distilling News:

•St. Louis-based Schlafly Beer is launching three new brews as part of its seasonal Stout Bout sampler pack. Along with Schlafly’s existing Coffee Stout label, this year’s Stout Bout 12-pack will exclusively feature newcomers Vanilla Milk Stout (5.2% abv), Toasted Coconut Stout (5.7% abv) and Mexican Chocolate Stout (6.2% abv). Schlafly is also bringing back White Lager, a German-style seasonal available in six-packs. The Stout Bout sampler pack ($14.99 each) and White Lager ($8.99 a six-pack) will be sold across Schlafly’s 14-market U.S. footprint.

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