MARKET ANALYSIS

A Comparison of the Scotch-Whisky producing Regions

23. September 2015 | 3.1K Views
Please note that this article is based on the old Whiskystats database.
Some numbers and figures may not match what you find in the Whiskystats 2.0 database.

We start our analysis of the secondary whisky-market by comparing the scotch-whisky regions. As each region has its own environmental character which it passes to its whiskies, we expect to see differences in the market demand. 

First things first. We have to declare what the scotch-whisky regions are! Following the Scotch Whisky Association there are five official scotch-whisky regions: the Highlands, the Lowlands, Speyside, Islay and Campbeltown. On whiskystats.net you will find that we also recognise “the Islands”, a sub-region of the highlands, as a scotch-whisky region. Furthermore there a bottles for which their producing distillery, and therefore the region, is unknown. For this reason we added the “Unknown” region to our database. So in total we observe seven different regions in our dataset:
 

  • Highlands
  • Lowlands
  • Islands
  • Islay
  • Speyside
  • Campbeltown
  • Unknown

The Market Share of the Scotch-Whisky Regions
 
Our first step in comparing these regions will be the determination of their respective market share on the secondary whisky-market as it is represented by our database. If you are a Whiskystats-Member, you can always see the latest figures at our Whisky Database Overview. There you can see that more than 37% of the bottles are distilled in speyside, which consequently has the highest market share. On the second place follows islay with around 26% market share. More or less exactly 20% of the scotch-whisky is distilled in a highland-distillery. In total the speyside-, islay- and highland-distilleries account for more than 80% of all scotch-whiskies on the secondary-market. On the places follow the islands, campbeltown and the lowlands with 7%, 5% and 4% percent market share, respectively. The scotch-whiskies with unknown region account for less then 1% of the market.
 
The Whisky Region Indices
 
As a summarizing measure of how the whiskies of a region changed in value over time we introduce our region indices. As a Whiskystats-Member you can find them in our Toolbox. We will explain in detail how these indices are calculated in one of our upcoming articles. In short, every index starts with a value of 100 in the beginning of the year 2006. You can interpret a value of e.g. 200 as if the value of the most traded whiskies of that region doubled over the considered time interval. With that said, we can compare the regions by the evolution of their indices.
 
Tough times in the years of 2008 and 2009
 
Our first observation is that almost all region indices experienced their minimum, or came very close to it, in the years of 2008 and 2009. Furthermore, except of the islay and highland whiskies, all regions lost value from 2006 to 2009. As for most of the regions this drawback was only a few points below 100, the campbeltown index dropped to 83 points in December 2009.
 
Yes we rank
 
Another usage of indices is to rank the regions by their latest index value. As explained above, this can be interpreted as a ranking by the gain in value of the most traded whiskies of each region. If we do this, we see that by September 2015 the campbeltown whiskies had a hard time recovering from their earlier drop and take the last place with an index-value of around 115 points. The whiskies with unknown region reach 143 points. The Lowlands and the Islands are on the fourth and fifth place with around 170 and 180 points, respectively. The podium belongs to the same regions that also have the highest market share. On place three we see speyside with an index-value of around 210 in September 2015. Slightly above lies the index of the highlands with 230 points. A unchallanged victory in terms of our region index belongs to the islay whiskies. They not only never dropped below 100 but also reach the highest index-value in September 2015 with more than 270 points.
We summarize our results in the following list:
 

  • Islay: 271.08 (market share: 26%)
  • Highlands: 233.65 (market share: 20%)
  • Speyside: 212.35 (market share: 37%)
  • Islands: 187.11 (market share: 7%)
  • Lowlands: 172.74 (market share: 4%)
  • Unknown: 142.63 (market share: 1%)
  • Campbeltown: 115.26 (market share: 5%)

Note that these figures are subject to change as we observe new prices. For more information please read our article About the Whiskystats-Indices!
 
We conclude that the market-demand indeed differs from region to region. All of the indices experienced their major growth from the year 2010 and onward. It seems legitimate to say that islay whiskies belong to the most wanted whiskies out there.