Previously, I discussed the early phases of the Scotch whisky industry, and its close relationship with Scottish political history. As Scotland became more integrated with the United Kingdom, so too did its national drink.
Scotch whisky as British history
Developments in the Scotch whisky industry in the nineteenth century largely reflect the broader themes of industrialization that changed the economic and social life of Great Britain during this era. One of the major themes of industrialization is an increasing homogenization of processes leading to mass production of goods. A prime example of this trend towards homogenization is the emergence of blended Scotch whisky as a major product. During this era, whisky transitions from a local product largely made by artisans on a small scale for local consumption to one that is mass produced using industrialized techniques. The marketing and selling of whisky also reflects the changes in consumerism of the era. My research did not encompass any of these major changes in detail, but these developments are incredibly significant for later phases where whisky becomes an important export product.
As briefly stated before, whisky is a distilled alcoholic fluid which means that it has been successively boiled into a vapor and the re-condensed into liquid form a number of times. After each distillation, the fluid that remains is of a higher alcoholic content than before. The traditional method of distillation uses a pot still, a large copper vessel with a tall neck that bends at the apex and leads back down as a pipe into a cooling tank. The fermented ale is super-heated in the copper still to the boiling point, the vapors rise to the apex and then condense in the cooler portion of the pipe leading to the receiving vessel. Pot still whisky is usually distilled twice in this manner, taking an ale of about 8% alcohol by volume and bringing it to a potency of about 70%.
The 1820s brought two significant changes to traditional whisky making. The Excise Act of 1823 signaled a change in Government strategy towards illicit distilling and tax evasion. The wide disparity of regulations across different regional jurisdictions were simplified and the new Act encouraged the purchasing of a flat licensing fee for a still and a standard duty paid on each gallon produced. Officially licensed stills had to be larger than 40 gallon capacity to qualify. Overall, the Act favored the large landowners with greater capacity stills, and pushed small producers out of business. Smuggling waned dramatically over the next decade.
Technological advances also favored large-scale production. Distillation done by pot still is a process done in batches. One batch of ale is run through the still at a time; it is a process of heating, cooling, cleaning and preparing for the next batch. A number of inventors worked to produce a still that would operate continuously with a steady supply of fermented ale at one end and condensed spirit coming out the other. Aeneas Coffey, a former Irish Excise officer, patented a continuous still in 1830 and a number of ‘Coffey Stills’, also called patent stills, began producing whisky in Scotland over the next few decades. Patent stills create highly uniform and very strong spirits, and work well with cheaper unmalted cereal grains, like corn. These whiskies are called ‘grain’ spirits to differentiate them from those made purely from malted barley.
Whisky grew in popularity in English taverns and hotels throughout the nineteenth century, competing against gin and ale and other alcoholic beverages. Scotch was drunk by English sportsmen on their hunting travels to the north, and brought back to revive memories of their Scottish holidays. An aphid disaster among the vineyards of Europe in the 1860s and 1870s devastated the wine industry, and reduced stocks of cognac (distilled from wine), the most popular liqueur in Britain at the time. However some factors worked against Scotch whisky’s popularity. Grain whiskies, largely a product of the increasingly industrialized Lowlands, were relatively bland as a beverage. Malt whiskies on the other hand had a reputation for the harshness of their taste and unpredictability in their quality, likely conjuring up an image of the feisty ill-tempered Highlanders that preferred such a dram. To suit the tastes of a growing British consumer class, blenders stepped in to develop a new product that evened out the taste and brought more predictability to the whisky drinking experience.
Merchants and grocers, responding to the needs of their customers running hotels, taverns and restaurants, were the first to see the benefits in blending a variety of grain and malt whiskies into a pleasing mixture and then bottling and selling the product under their own brand name. Adding blended whisky to their repertoires of products like teas, wines and imported foodstuffs produced some of the most successful wholesale business empires to emerge in the final decades of the nineteenth century. Family businesses like those run by John Dewar, John Walker and the Chivas Brothers used new techniques of marketing, advertising and salesmanship to bring Scotch whisky to an ever-expanding cadre of consumers. A traveler visiting an unfamiliar tavern did not have to risk the chance of receiving a blast of the local firewater when asking for a whisky. Ordering a well-advertised blend, like a Johnnie Walker Red Label, assured him that he was likely to get something enjoyable or at least be able to avoid it the next time. In this way, the standardization and homogenization across a variety of products and behaviors so prevalent during this era of industrialization can be illustrated in developments in the history of Scotch whisky.
An interesting companion to the more staid economic histories that cover British industrialization is Stuart Delves, Creative Fire: The story of Scotland’s greatest export (2007). Delves goes into the aspects of marketing and consumer psychology that have made Scotch not only a successful product, but extremely powerful as a ‘brand’ in itself. The ‘brand’ of Scotland and the ‘brand’ of Scotch figure prominently in British economic and business history, and some mention of the growth and development of the great ‘blending houses’ leads directly to a discussion of exports in the British imperial arena.
The United Kingdom budget of 1909-10 is credited with bringing a number of changes to the industry in Ross Wilson’s Scotch: The Formative Years. A hefty tax increase on whisky triggered a wave of consolidation in the industry, and pushed the remaining companies to increasingly look outward to the export market as the route to sustainable profits.
Since the 1860s a number of whisky producers cooperated as the Scotch Distillers Association, and this trade group incorporated in 1877 as the Distillers Company Limited, or DCL. The DCL continued to expand, adding blenders to its whisky portfolio and also makers of pharmaceuticals and industrial chemicals. By 1925 the DCL became an even more powerful company after the merger of the “Big Three”: the major blending companies of John Walker & Sons, John Dewar & Sons, and James Buchanan & Co. The DCL is the forerunner of Diageo, currently the world’s largest producer of spirits and a major multinational corporation with vast interests in the food and beverage industry. Industrial consolidation is an important and recurrent theme; particularly as these business moves are made in the context of major political events like the First World War. R.B. Weir’s The History of The Distillers Company, 1877-1939 is a major work of economic history that describes the political, legislative and technological influences on the industry during this turbulent time. I gained access to Weir’s unpublished thesis at the University of Edinburgh that served as the basis for this work, which contained extensive bibliographic information on his archival and manuscript sources. Weir was a professor of economics at the University of York and published scholarly articles on the Scotch whisky industry; his work is of particular interest to me due to his focus on the growth of Scotch as an export product after 1918. Weir credits the development of a world-wide network of trade agents throughout the British imperial area of influence with promoting Scotch exports. The new brands of blended Scotch worked well as products sold in a new method of exporting.
In the final decades of the nineteenth century Scottish trade transitioned from an ‘adventure merchant’ model to the ‘agent’ model. The adventure merchant model saw a partnership purchase a quantity of export goods from various sources and reap profit from the entire voyage based on their ability to sell the goods in foreign markets. The agent model placed an agent for a specific industry or producers in a foreign market who took orders and then relayed these orders, via merchant vessels, to the home industry for fulfillment. The seller paid for the shipping of the goods to the agent, and the agent was ultimately responsible for their sale. Shippers made profit from carrying, not selling, the goods. Weir discusses the role of Jack Walker, member of the John Walker family business, in shaping the Australia market for the Johnnie Walker brand in his thesis, providing insight into how orders from Sydney were sent back to London. The Walkers had agents in South Africa, America and even Singapore by the 1890s.
Tommy Dewar, of the Dewar family, famously went on a round-the-world excursion to publicize Dewar’s whisky in America, Hawaii, New Zealand, China and Hong Kong. He published his journal as A Ramble Round the Globe in 1894 and selections were republished during the 1920s in the DCL Gazette, the trade publication for the whisky industry. Copies of the DCL Gazette are located at the National Library and provide a snapshot of how the industry perceived itself, publishing stories on the lives of notable industry personalities as well as key developments in the business of Scotch whisky.
I found a few references to agents possibly working in the Middle East that require further research. Wilson’s Scotch: The Formative Years refers to the Wm Sanderson & Son company appointing an agent in Egypt in 1912, and the DCL sent their agent, J. Stuart Smith, on an around the world trip to develop the whisky trade in 1891.
Scotch whisky and the Great War
The first decades of the twentieth century saw significant changes in the whisky industry, and the world at large. Media sources, government records and business communication provide a wealth of data on these changes and relate how the First World War brought government intervention to the industry in a way unimaginable in previous decades.
In The Scotch Whisky Industry Record, H. Charles Craig pulled together a comprehensive compendium of noteworthy events related to the whisky industry. The work was published in 1994 and I found a copy of this rare work in the National Library of Scotland. The book aims to list every notable government act and significant business move related to the industry since the first official mention of ‘aqua vitae’ in 1495. I looked through the book looking for references to exports to Iraq and the Middle East around the time of the First World War but found nothing explicit. However, a few entries are useful to note here as illustrating some of the ways the industry was shaped by government policy in the era and set some of the standards that are still in effect today.
In 1908, a Royal Commission decided to protect the industry by declaring that ‘Scotch’ could only mean whisky produced and aged in Scotland, an indication that the product was sufficiently popular to warrant protection from imitations abroad. In 1915, the Immature Spirits Act set the three year minimum requirement for the maturation process. While it was commonly known that Scotch mellowed a bit with age and gained quality, the move was largely supported by pot still distilleries making malt whisky as a competitive move against their patent still competitors who could quickly produce and place large amounts of new whisky on the market. Overall the effect was to limit the supply of whisky on the market as the nation got deeper into the war on the continent.
This limitation was beneficial to business interests looking to charge higher prices for their more valuable supply, but another rationale was the growing interest of government in curbing the behavior of British citizens during wartime.
Temperance movements influenced the business and politics of alcohol throughout the nineteenth century; the Great War provided powerful justifications for stricter control of the whisky trade.
Another part of the Act of 1915 led to the creation of the Central Control Board, a body given the authority to reduce opening hours of pubs and taverns, regulate the alcoholic strength of specific beverages and in general work to restrict alcohol consumption across the United Kingdom.
Social reformers and religious leaders of all stripes supported these moves to curtail what they saw as one of their nation’s longtime societal ills.
The wartime government of Lloyd George moved to strictly ration British agricultural products and control its industries to ensure that the nation’s supplies of grain and yeast did not all end up as whisky, and that its distillers were busy making the right kind of alcohol useful in high-explosive munitions. The government strictly controlled the price of spirits to prevent profiteering, and in 1918 prohibited whisky exports. In February of 1919 exports were again permitted, but only at half of the pre-war level. These moves to curtail the sale of whisky during the First World War stood in stark contrast to the policy of Winston Churchill’s government during the Second. “On no account reduce the barley for whisky,” he wrote in an April 1945 memo, calculating the strategic value of this commodity in producing dollars on the export market.
Scotch whisky and Prohibition
The temperance movement active in developing British wartime policy was part of a worldwide phenomenon. Prohibition in the United States, ratified as the 18th Amendment to the Constitution in 1919 and in effect from 1920-1933 was merely one component of broader agenda of social reform that played out in the aftermath of the First World War. However, this episode looms large in the development of the Scotch whisky industry. At first the loss of this market is a major blow to the industry, but it inadvertently created several benefits over the long term. When American Prohibition was repealed, Scotch whisky was positioned as a premiere drink of quality in the eyes of American consumers, and Scotch producers were able to demand top dollar for their product.
In a series of archival documents from a number of sources I found a number of references to prohibition efforts in the US and around the world. In the archives of the Highland Park Distillery Company in the city of Kirkwall in the Orkney Islands just off the northern coast of Scotland, I reviewed a series of newsletters put out by the Whisky Association (WA), an industry advocate group. In periodic circulars and annual reports published from 1917 to 1921 major issues of importance to the industry at large are presented and discussed.
In an October 9, 1919 circular the industry was advised to not get tied up in the American market as Prohibition had indeed been passed and would go into effect the next January. (It was well known that many whisky dealers were involved in smuggling but the industry party line was to present the appearance of propriety.) As well, the British government was still maintaining a restriction on exports to foreign and colonial markets. Norway had recently passed a prohibition measure with 60% of voters in support, but this measure only applied to spirits. Whisky and other spirits continued to be unfairly singled out by temperance groups. New Zealand had also considered a measure, but the large number of soldiers still stationed in Europe voted overwhelmingly against its passage. The importation of spirits to the British West African Colonies was prohibited.
In a WA circular dated June 30, 1920 the position of the WA towards the American market had changed. Despite earlier suggestions not to get caught up in trying to supply American dealers, the WA saw a loophole in US law that could be exploited by the whisky industry. US law permitted spirits to be sold for medicinal purposes in pint-sized containers at drug stores. Whisky bottlers were told to attempt, through this avenue, to keep Scotch familiar to the American palate before a “Japanese or some other foreign concoction” became popular. The circular described a New York Post article reporting the fact the 16,000 doctors were now licensed to prescribe liquor, and the number was growing every month. The circular continued with a discussion of recent market activity in Australia, India and Japan. The editor expressed concern over Japanese “fakes”—the apparently widespread practice of copying Scotch labels for use on locally-made (and obviously inferior) spirits.
Another WA newsletter discussed a Daily Telegraph (London) article (January, 28 1921) describing Quebec as the “Mecca of the people of the United States and the dry provinces of Canada.” Quebec’s provincial government was reaping the benefits of staying wet when just about everywhere else prohibition regulations were in effect. The province was now the liquor capital of North America.
The Highland Park archives also preserved a large collection of business correspondence. I reviewed a stack of letters dated in the early 1930s, as momentum towards the repeal of Prohibition gained ground. There is a tone of desperation in the letters from American importers begging to be the exclusive agent for Highland Park in the US. But, as the many responses to these letters take pains to point out, Highland Park did not engage in bottling and selling its own whisky for wholesale or retail purposes. Highland Park was sold primarily to blenders and bottled under a separate brand. Although the executives at Highland Park writing these responses were plainly bemused by the apparent ignorance of the Scotch whisky industry among American importers, in hindsight they may have learned a thing or two from this interaction with eager American consumers. Highland Park is still a major component of the popular blended whisky, The Famous Grouse. But it is also now one of the leading brands of single malt Scotch whiskies, sold under its own brand name. The direct export of single malts, whiskies that are the sole product of one distillery, is only a recent phenomenon of the past few decades. While single malts now compete with blends on the shelves of liquor stores around the world, this was not the case back at the end of Prohibition.
By the end of 1934, the United States was the leading export market for Scotch whisky in the world. Through the efforts of quite a few smugglers, Scotch did indeed remain close to the American palate. The experiences of bathtub gin, moonshine and other illegally produced spirits gave American-made liquor a bad reputation and enhanced the belief that if you got your hands on some real Scotch, you were getting a quality dram. Scotch whisky maintained a luxury appeal in the face of many competitors and imitators.
During this search of an individual whisky distiller’s archives at Highland Park, I looked in vain for evidence of exports to, or even a discussion about markets for whisky in the Middle East. While I was becoming able to relate the history of Scotch whisky to a number of other historical themes, I had not found a great deal of material on the specific questions I had about Scotch in Iraq. Fortunately, I had a breakthrough with a little Johnnie Walker.
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