Irrespective of the export market, the most important thing to remember is that for cask investors it has no bearing on them.
Recent free trade agreements signed by the UK government will provide a major boost to the Scotch whisky market ensuring trade continuity having left the EU. So far 60 of these agreements are in place and the Free Trade agreement that was signed with Japan mirrored the existing arrangements that were in place when the UK was part of Europe meaning there will be no impact from a tariff perspective. Japan imported 45 million bottles of Scotch in 2020 and was worth £114m in exports.
In addition, Britain is aiming to join the Trans-Pacific Partnership. The partnership involves 11 countries such as Japan, Australia, Canada and Vietnam. Currently, Asia and Oceania makes up 25% of total export market for Scotch worldwide.
Vietnam free trade agreement:
This will lead to the gradual elimination of the 45 per cent import tariff in Vietnam. This development is also an important step forward to the UK’s accession to the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, which will deliver new opportunities for Scotch whisky, as well as other products, in key markets in Vietnam.
The Mexico-UK spirits agreement was made in December giving post-Brexit protection to Scotch whisky and Mexican spirits in both countries. Last year, Mexico was in the top ten export markets for Scotch whisky by value-£120.9 million and was the sixth largest market for Scotch whisky by volume globally.