The Scotch Whisky Association (SWA) has revealed that exports of Scotch whisky in the first half of 2024 (H1) have fallen by 18% compared to the same period in 2023.
Following a record breaking 2022, data from HMRC (His Majesty’s Revenue & Customs) shows that the value of Scotch whisky exports dropped by 18% (£463.2 million/US$603.4m) to £2.1 billion (US$2.74bn) in H1 2024, when compared with the first half of 2023.
In the same period, the volume of exports fell by 10.2%, to the equivalent of 566 million 700ml bottles, or 36 bottles of Scotch whisky exported per second, compared to 40 bottles per second in the first half of 2023.
The SWA has subsequently called on the new UK government to take action to ‘back Scotch producers to the hilt’, as prime minister Keir Starmer promised to do in the run up to the General Election in July.
SWA chief executive Mark Kent said: “These figures are a reminder that the success of Scotch whisky cannot be taken for granted and requires government support to ease the industry through short term volatility.
“We are a resilient industry, exporting to more than 180 markets, and are experienced in navigating such periods of turbulence, and we are confident of the long-term growth opportunities for Scotch whisky. But it is clear that the first half of 2024 has been challenging, as for other premium global exports. This has not come as a surprise given the volatile international situation affecting global industries and inflationary pressures which have fed through to consumers across global markets.”
Kent noted that reducing the tax burden on Scotch whisky at the Budget on 30 October, following the damaging domestic impact of the 10.1% duty increase in August last year, is one way the new Labour government can show it “truly supports Scotch”.
“Last year’s double-digit tax hike on Scotch whisky in the UK, the largest in 40 years, has already lost HM Treasury almost £300 million in tax revenue. Beginning to reverse the damage by cutting duty on Scotch whisky will boost public finances and bolster the industry through this challenging period.”
By value, the figures released indicate that the US remains the largest global market in the first half of 2024, however the industry continues to feel the impact of the 25% tariff on single malt Scotch whisky, levied between October 2019 and March 2021, which cost the industry £600m in lost exports and market share.
As such, the industry said it will continue to press for a full resolution of the underlying trade dispute and ensure that Scotch whisky is removed from further harm in this critical global market.
Kent added: “H1 figures clearly show that our biggest market, the US, has not fully stabilised following Covid and the damage caused by the 25% tariff on single malt in the US. The permanent elimination of this tariff, going beyond the current five-year suspension, would remove uncertainty, give the industry increased confidence and allow our full focus to be on growing in this highly competitive spirits market.”
Despite the current 150% tariff on imports remaining in place, India is the largest market by volume, with growth of 17.3% in the first half of 2024 compared with the previous year.
The SWA has called on the new UK government to redouble efforts to conclude the UK-India Free Trade Agreement. The phased reduction of the tariff would benefit industries in both the UK and India and could see the value of scotch whisky exports grow by £1bn (US$1.3bn) over five years.
“It is welcome that the UK government has picked up negotiations on a UK-India trade agreement,” Kent said. “Exports to India have been a bright spot in the first half of 2024, despite the current 150% tariff being a brake on future growth. Securing a deal which reduces the tariff would be a major boost to the industry and help to mitigate the impact of a slowdown in other global markets.”
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Author: Georgie Collins
