If you’re keen to diversify your investment portfolio – or just partial to a nip of whisky! – purchasing a cask of whisky could be a corker of a move. On the back of an increased demand in Asia, London-based Cask Trade, one of the biggest cask traders in the UK, has now opened an office in Hong Kong. That means you can now buy casks at UK prices without a hidden brokerage fee – starting from around HK$30,000, in fact.
But why would you? In short, because the opportunity for growth in Asia seems unprecedented, with the number of bottlers, investors and avid whisky enthusiasts in the region continuing to swell. According to the Cask Trade team, there’s been a 25 percent increase in their existing business in Asia already; and they’re expecting a similar increase on the back of launching a physical presence here.
Whisky on the rise
If you don’t believe that whisky casks are becoming big biz, take a look at these amazing stats.
- Cask Trade has sold over 2000 casks to trade and independent bottling companies
- The company sells to 300 independent bottlers globally
- 575,000 bottles have been bottled or are waiting to be bottled
- More than £400,000 worth of casks have been sold through the company’s auction site
Among those who are buying the whisky are private bottlers – owners of whisky bars or retail outlets, for example – along with corporate clients (some of whom purchase a cask of whisky for their team and bottle it for the company anniversary!) and those interested in the investment side alone. It’s a growing community.
The advantage of casks
Why buy a whole cask rather than a bunch of bottles, you might be asking. The main reason is that the liquid doesn’t continue to age and mature in a bottle. Whisky in casks, on the other hand, continues to mature; so, if you buy a cask that’s aged 12 years, in three years’ time, you have 15-year-old whisky; three years further down the track, you have 18-year-old whisky. A bottle of 12-year-old whisky may well grow in value over time, but only on account of the supply and demand for that type of drink. It’s still a 12-year-old whisky.
As the team at Cask Trade explains, this gives you a unique opportunity to experience the “journey” of the drink – how the liquid transforms with age, and how its value appreciates at the same time. Their stock of casks comes in a range of different ages – from new-make to ultra-old (30 years and more). And, because they own all the casks they sell, the team can check samples and give professional advice on when to exit or bottle; as a customer, you always have the option of doing the sampling yourself too.
There are other pluses with buying casks. Exclusiveness is one; each cask of whisky has a unique cask number, and no two casks taste the same. And then there are the logistics and storage costs. Bottles take up a lot of space. If you keep acquiring bottled whisky, the need for extensive storage room will grow as your collection grows. First, you’ll start eating up all that floor space in the home office; next, you’ll be renting a pricy storage unit.
Cask Trade casks, on the other hand, are kept under their name in what’s known as WOWGR storing (it stands for “Warehousekeepers and Owners of Warehoused Goods Regulations”) in bonded warehouses in Scotland.
Choosing a whisky
If you’re a whisky enthusiast, you no doubt have a preferred dram. The good news is that Cask Trade is a leading stockist in the APAC cask trading market – and the first to buy and fully own casks it offers as stock instead of brokering a price list; this means you have an extensive list of distillers to choose from. These include top-tier “dream casks” – from the likes of Macallan, Littlemill, Highland Park, Springbank and Bowmore – to new world indie distillers such as Cooley and Mackmyra. Around 80 percent of the Cask Trade stock is Scotch whisky, while Irish whiskey makes up around 10 percent, and rum another 10 percent.
How it works
Once you’ve got your eye on a whisky, the process can begin. Here, the Cask Trade team runs through the four “P’s” of buying whisky casks.
PICK: “Decide on your aims, budget and hold time, and we’ll advise you on your selection.”
PURCHASE: “Having received payment, we’ll issue you with a Certificate of Ownership and Transfer of Title.”
PATIENCE: “Whisky only matures in the cask; the older and more mature a whisky, the greater the value.”
PROFIT: “Our diverse exit strategies and global client base ensure you’ll get the best return on your whisky.”
What else?
Cask Trade has started a live auction website dedicated to exceptional whisky casks – auctionyourcask.com. Hosted four times a year, it helps private owners and investors sell their casks to independent bottlers and other investors all around the world. All casks are “re-gauged” so they are ready for auction, and a full bottle sample is drawn so bidders have the opportunity to try the whisky before they buy, where possible. Everything is validated – from the sellers, to proof of ownership and the history of the cask – so you can be sure of safely bidding and buying. There’s a low buyers’ fee of 15 percent (plus VAT), and no sellers’ fee.
Coming up!
Sell or auction your cask at the next upcoming auction; see auctionyourcask.com for details.
Find out more about investing in whisky casks in Hong Kong at casktrade.com; and talk to Cask Trade’s whisky experts at info@casktrade.com or +852 3975 3028.
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