Scotch Whisky exports down 18% as Starmer urged to cut duty

New figures from the Scotch Whisky Association (SWA) show that export values fell to £2.1bn during H1, while volumes declined by 10.2%.

By value the US remains the largest global market, although producers continue to feel the impact of the 25% tariff on Single Malt Scotch Whisky, which cost the industry £600m in lost exports and market share.

Meanwhile, India is the largest market by volume and grew 17.3% during H1, despite the current 150% tariff on imports remaining in place. The phased reduction of the tariff could see the value of Scotch Whisky exports grow by £1bn over five years, according to the SWA.

‘Back Scotch producers to the hilt’

In response to the trends identified in the data, the association called on the UK Government to back Scotch producers as was promised by prime minister Keir Starmer in the run up to the general election.

“The prime minister has promised to ‘back Scotch producers to the hilt’, [but] 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,”​ said SWA chief executive Mark Kent.

“We are a resilient industry, exporting to over 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.”​

Looking ahead to the budget on 30 October, Kent urged the government to “show it truly supports Scotch”​ but cutting duty rates.

“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,” ​he continued.

“Beginning to reverse the damage by cutting duty on Scotch Whisky will boost public finances and bolster the industry through this challenging period.”​

‘Eliminate US tariff’

Referencing trade issues with the US and India, 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.​

“It is welcome that the UK government has picked up negotiations on a UK-India trade agreement. 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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