
The rise of Scotch whisky in China - How whisky's popularity in China, is changing cask investment

Victoria O'Brien
Head of Content at London Cask Traders
Scotch whisky exports to China have risen dramatically in the last five years. According to the Scotch Whisky Association (SWA) whisky consumption in China surged post-Covid - restocking of the hospitality sector being one reason.
The value of Scotch exports to China rose from £88,794,800 in 2019, to a staggering £235,290,854 in 2023 (source: SWA). That dramatic spike has naturally slowed in recent years settling to near pre-pandemic levels, but for investors in casks of premium Scotch whisky, this isn’t necessarily bad news.
China's new appreciation of whisky is aligned with luxury goods. Whilst export volumes may be down, the overall value of the whisky market in China is definitely up. More recent reports from Euromonitor indicate the sales value of whisky in China is likely to increase from £370 million in 2021, to a predicted £1.8 billion in 2025. All of this is headline grabbing news, but what exactly does it mean for whisky cask investors?
In 2023 China failed to rank amongst the top 10 countries by volume, but was fifth in global whisky export value. (source: SWA)
Asia Pacific, as a whole, accounts for 32% of the global market by value, significantly more than either North America at 21%, or Europe at 28%. (source: SWA)
When we talk about whisky exports, it’s important to note figures quoted are based on bottles, not casks, since whisky casks themselves cannot be exported from Scotland (a rule enforced by UK law). Single grain Scotch Whisky, blended malt Scotch Whisky and blended grain Scotch Whisky can only be moved outside of Scotland, once it is bottled.
Large companies like Diageo are setting up their own distilleries in China, but this is unlikely to affect Scotch whisky cask investment, since the potential market in China is being driven by rarity and provenance: single malt varieties, globally recognised names produced and bottled in Scottish distilleries, are still the most highly prized. Chinese businessmen are known to close deals with a toast of only the finest Highland malts; it’s considered and revered as a premium product. Authenticity is key.
‘The cultural interest in Scotch whisky throughout South East Asia, cannot be overemphasised,’
says London Cask Traders’ Head of Finance, Arjun Rajawat.
‘Growth of the millennial middle class is boosting awareness of both heritage and provenance, with statistics confirming this favours investing in casks of the finest and rarest single malts.’

NEW DISTILLERIES IN CHINA
China will be producing more and more of its own whisky in the future, but this will likely only fuel more demand for original Scotch whisky single malts, and rare varieties. Any expanding market drives competition and profits, and this is especially true for Scotch, which retains its value through both rarity and unquestionable provenance. Again, the overall growing demand for whisky in China is positive news for cask investors.
Emily Roads (formerly Head of Trade for Asia Pacific at the Scotch Whisky Association, now International Deputy Director), confirms that while whisky exports’ volume to the region has decreased, overall value has grown. She attributes this to a shift in consumer behaviour, driven by a younger, well-educated middle class that prefers high-quality, unique whisky experiences. According to Roads, ‘these consumers are consistently trading up their whisky choices, opting to drink less, but drink better.’
GEN Z AND THE RISE OF PREMIUM WHISKY
In early 2024, Tom Pattinson, writing for the China-Britain Business Council (CBBC), noted China's Gen Z’s ‘love of The Macallan.’ As Pattison put it ‘whilst in the West, whisky has traditionally been preferred by an older audience, in China, it is the young who are drinking more of it.’ Pattinson highlighted how the perception of whisky has evolved since his time in Beijing in the early 2000s, when nightclubs were branded with Pernod Ricard’s Chivas Regal, and ‘Chivas and Green Tea’ was the go-to drink for clubbers. Today whisky in China is coming of age, with increasing demand for single malts and premium blends, but according to Pattinson the typical Chinese whisky drinker is still under thirty, around 29 years old. Urban, wealthy, and well-educated (having often studied abroad), they are buying into a lifestyle that represents culture, class and history. Pattinson’s take on the whisky industry in China, is that this trend towards ‘premiumisation’ is only set to continue.
Pedro Mendonça, formerly managing director of innovation at Diageo, agrees explaining how the whisky market in Asia ‘started very much with blends and big brands, trying to do big plays.’ Apparently, what’s changed is consumers’ perceptions, expectations and aspirations. ‘Over the last decade, single malt has taken off,’ confirms Mendonça, ‘and people are discovering and finding their own way in, appreciating the different flavour and characteristics.’ Chinese consumers, with increasingly sophisticated tastes, have driven this rise in demand for higher-value whiskies. Euromonitor data confirms that single malt brands such as Glenfiddich and The Macallan have tripled their market share since 2019.

A THRIVING WHISKY INDUSTRY IN CHINA, IS GOOD FOR EVERYONE
With the price of exports rising, Pernod Ricard has committed more than £110 million over the next decade setting up a distillery in China’s western Sichuan province, while Diageo is investing nearly £100 million in its own Eryuan Distillery in Yunnan Province. The MengTai Group recently relocated stills and equipment from Scotland to Inner Mongolia, creating a £20 million distillery there, all of which is good news for whisky cask investors.
‘This proves the huge demand in China for whisky made using traditional methods,’
explains London Cask Traders’ Oliver Court.
‘But the fact remains, whatever they produce in these distilleries, it still can’t be called Scotch.'
According to Court, aside from the grain being imported and native woods used in the process of making casks imparting very different flavours, you simply cannot replicate the rarity, provenance and heritage of casks produced and stored in Scotland.
'As local knowledge and enthusiasm for the traditional whisky making process grows, there will be an increased appetite for the finest and rarest Scotch whisky. Our prediction is it’s only a matter of time before Chinese demand for authentic, heritage Scotch whisky, converts from bottles into direct cask investments.’

Victoria O'Brien
Head of Content at London Cask Traders