2019 Market Update | day 72

Posted in Beer, Industry, Spirits, Wine.

Pernod Weighs Sale of Jacob’s Creek, Campo Viejo Wines

Pernod Ricard SA is considering a sale of its wine division, which includes Australia’s Jacob’s Creek and Spain’s Campo Viejo labels, according to people familiar with the matter.

The world’s second-largest distiller has held early discussions on a potential sale of the unit, which has sales of about $500 million, said the people. Deliberations are at a preliminary stage and Pernod may ultimately decide to retain the business, said the people, who asked not to be identified discussing private information.

“As a matter of policy, the company doesn’t comment on rumor or speculation,” Pernod Ricard said in an email.

Pernod Ricard shares rose as much as 2.9 percent after Bloomberg reported on a potential sale. The stock closed 0.3 percent higher in Paris.

The maker of Absolut vodka began studying options for the division since before being targeted by Paul Singer’s Elliott Management Corp., one of the people said. The activist investor disclosed a stake in December, calling for 500 million euros ($565 million) worth of cost cuts at Pernod Ricard, which trails only Diageo Plc in the spirits business.

“The group is under no external pressure and has already mentioned several times that it intends to continue the dynamic management of its portfolio,” Pernod Ricard said by email.

Less Profitable

The Paris-based company’s wine operation is less profitable than its roster of spirits brands. While Pernod Ricard has acquired vineyards such as Kenwood in California and Helan Mountain in China’s Ningxia region in recent years, Chief Executive Officer Alexandre Ricard has favored expanding in faster growing craft liquor by buying brands such as Monkey 47 gin and Del Maguey mezcal.

“For me, this makes a lot of strategic sense as it’s a relatively small part of the group, with lower growth and lower profitability,” Sanford C. Bernstein analyst Trevor Stirling said.

The company has also divested other products it doesn’t consider central to its strategy, such as the Domecq line of brandies and Paddy Irish Whiskey.

The wine industry is more fragmented than the beer and spirits sectors, where players have driven consolidation over the past several decades to gain advantages in distribution and supply costs. In 2016, Diageo sold its wine business to Treasury Wine Estates Ltd., the Australian producer of Penfolds, for $600 million.

Pernod Ricard (RI FP) – Potential sale of wine brands

  • Jefferies
  • Edward Mundy, ACA, Elsa Hannar
  • March 13, 2019

Key Takeaway

Disposals of non-core assets are part of the ordinary course of business at RI. However, we question whether a disposal of the entire wine division is likely given: 1) the B/S is strong; 2) wine has a strategic role in some markets; 3) limited financial impact, with 20bp accretion to growth vs -1% EPS dilution. While we do not altogether rule out a wine disposal, we do not necessarily see RI reacting in a knee-jerk fashion to external pressure.

Insights

What’s new?

Bloomberg is reporting that RI is considering a sale of its wine division, citing people familiar with the matter. Per Bloomberg, the company has been in discussions on a potential sale, with deliberations at an early stage.

Where does wine fit into the House of Brands framework

In the company’s House of Brands framework, there are 13 International Strategic Brands, four Strategic Wine Brands and 15 Local Strategic Brands. In total, RI has more than 100 brands. Pro-active portfolio management is already under way, with the recent disposals of Domecq brandies and wines and Paddy Irish Whiskey; we would not be surprised to see further disposals of non-core brands.

What is the role of wine?

Premium Wines account for c5% of group sales, with F18 growth +2% vs F17 +4%. There are four priority wines: Jacob’s Creek (6.2m cases), Campo Viejo (2.5m), Brancott Estate (2.5m), and Kenwood (0.5m). The Mumm (0.7m) and Perrier-Jouët (0.3m) champagne brands sit outside of premium wines. We think the margins on wine are in double digits, with double-digit ROCE, albeit lower than for spirits as wine is an agricultural capital-intensive business.

What is the role of wines?

We see two key roles: 1) Door opener – providing a route to market for spirits. In this regard, wine is strategic in China (Jacob’s Creek and Mount Helen) in helping to expand Cordon Bleu into meal occasions; 2) Helps to dilute the fixed cost base – in certain markets (eg, UK), wine helps to cover structural costs, with profits generated on higher-margin spirits. We estimate that wine comprises as much as a third of UK sales. We see champagne as core as it helps the route to the nightclub market.

Financial impact of a sale of wine

Assuming sales of ?450m (5% of group) and lower margins (c.20% vs group 27%) would imply EBIT ?90m and EBITDA ?100m. Assuming a 12-15x EBITDA multiple would imply disposal proceeds of ?1.2-1.5bn. We believe that this disposal would be c.1% dilutive to earnings but 20bp accretive to growth (assuming no disynergies), and 40bp accretive to margins.

Balance sheet in good strength

RI net debt to EBITDA is 2.6x having been rebuilt post the Absolut transaction. We see key priorities as organic growth in the business, bolt-ons, and divi payout ratio rebuild (41% in F18 to 50% by 2020). The company has a mandate from the board for a buyback, but we view this as unlikely while there are potential bolt-ons to be done.

DIAGEO SEEKS $135M SEIZED SHARES IN UNITED BREWERIES FROM MALLYA

Diageo is seeking to assert its “legal and substantial” rights to $135m worth of shares in India’s United Breweries Holdings pledged to it by Vijay Mallya and his son Siddhareth, according to reports in India.

The shares, which have been seized by the Indian authorities, were used by Mallya as collateral for a loan guaranteed by Diageo’s Dutch subsidiary. Mallya defaulted on the loan and Diageo’s guarantee was called in.

India’s Enforcement Directorate has taken control of all Mallya’s assets in the country under its Prevention of Money Laundering legislation and a consortium of state-run Indian banks wants them liquidated to recoup the £1.15 billion they claim Mallya owes them as a result of the collapse of his Kingfisher Airlines in 2012.

The Economic Times reports that Diageo has opposed that application and has asked the court to be allowed to present its case over first rights ownership of the shares before they are sold.

Indian sources suggest this application will be opposed by the Economic Directorate but that Diageo might seek redress from Mallya under its Fugitive Economic Offender legislation.

Mallya fled to Britain in March 2016 and has appealed against a court ruling that he should be extradited to India. He has consistently denied wrongdoing.

Observers suggest that Indian banks’ demand that his assets be liquidated rapidly and Mallya’s appeal against extradition reflect the forthcoming Indian general elections which are due this spring.

Mallya has always alleged that the charges against him were politically motivated and that he has more than sufficient assets to repay his creditors. A change of government might have far-reaching implications.

In London, Diageo referred The Drinks Business to the legal disclosures appended to its latest interim results published in January and declined to comment further. Those disclosures confirm Diageo’s claim to the United Breweries shares pledged by the Mallya’s.

WHAT’S DRAGGING BEER DOWN? WHAT ISN’T?

  • Beer Business Daily
  • March 13, 2019

The latest round of Nielsen numbers are in and they’re ugly – scratch that – uglier.

Total beer volumes in Nielsen all outlet scans fell 2.3% for the four weeks to March 2, a little worse than the previous four weeks (ending February 23), which saw volumes drop 2.1%.

That’s par for the course in February.

Since the four weeks to Feb 2, total beer volumes have only gotten further into the red in Nielsen scan data – falling from down 0.6% in that four-week reading to where we find them today, down 2.3%.

Despite the gradual sink into negative territory for the entire stretch of February, total beer volume is somehow only down 0.1% YTD.

What’s dragging beer down? The better question is what’s not dragging beer down? Out of the ten segments tracked by Nielsen in this set, only three are in the black: FMBs lead the way, up 17.3%; super premiums follow, up 10.9%, but falling a little behind their YTD trend, up 14.7%. Then we have imports, up a modest 1.6%, though recall the segment was only up 0.9% in the prior four weeks.

Elsewhere premium regular and premium lights are withering, down 7.5% and 7.1%, respectively. Cider’s rose run looks to be coming to a close, down 4.5%, though still up 0.5% YTD. And craft is carving itself out a nice little hole, down 2.6% for the four weeks and down 0.6% YTD.

When it comes to brewers, there’s only four in this set that are growing.

Mike’s leads the way, up 40.4% in the four weeks, and is the only company outpacing its YTD trend. Diageo Beer Company posted the next best percent change in volume, up 11.8%. Boston Beer followed up 7.5%. And last but not least is Constellation, up 6%.

While Constellation’s percent change in volume is not what it once was, the brewer still outpaces all major brewers in category case share, up 0.7 points. But Mike’s is hot on its heels, up 0.6 points, and Boston is gaining share too, up 0.2 points.

FORMER ANHEUSER-BUSCH MARKETER BOB LACHKY DISSES BUD LIGHT’S CORN SYRUP ADS

‘It’s a total miss,’ says the brewer’s former chief creative officer, on the latest Marketer’s Brief podcast.

A former Anheuser-Busch marketer who was behind some of the beer industry’s most memorable campaigns says the brewer has missed the mark with its ads attacking Miller Lite and Coors Light for using corn syrup.

“It’s a commodity industry and the last thing you need to be doing is further commoditizing it with discussions about ingredients that nobody cares about,” says Bob Lachky, who spent 20 years at A-B, including serving as chief creative officer, before departing in 2009. “It’s just real disappointing. It’s a total miss.”

On the latest edition of Ad Age’s Marketer’s Brief podcast, Lachky opens up about why he thinks the brewer made the wrong call. The Bud Light ads, which debuted during the Super Bowl, have sparked the biggest beer battle in more than a decade between the nation’s two largest brewers.

MillerCoors-which has fought back by rallying support from the corn industry-is citing newly released sales results that it says show it’s winning the war. Bud Light sales fell nearly 9 percent in the four-week period since the Super Bowl, MillerCoors boasted in a corporate blog post on Monday, which cites Nielsen data. “It’s clear that Bud Light’s desperate attempt to mislead consumers is not helping them,” Anup Shah, VP of the Miller Family of brands, says in the blog.

In a statement to Ad Age, an Anheuser-Busch InBev spokesman states: “Our goal with the Bud Light campaign was to start a conversation around ingredients and transparency. We believe our current campaign has done just that-more people are searching for beer ingredients than ever before since running our ad.”

He adds that “this is not just a Bud Light brand play, but rather a portfolio play. Each brand plays its part to contribute to overall company growth, and our strategy is working, as evidenced by our company’s consistent improvement of total share of the beer category since Q1 2018.”

In its recently released fourth-quarter earnings report, AB InBev stated that sales-to-retailers in the U.S. fell 2.7 percent last year but that it had its “best annual [market] share trend performance since 2012.”

In the podcast, Lachky-who was behind classic campaigns such as “Whassup,” “Budweiser Frogs” and “I Love You Man”-says both brewers have lost their way.

“The Coors Light, Miller Lite, Bud Light advertising is talking to each other and not talking to the consumer. They don’t really care about this dialogue” he says. “Both sides are spitting at each other, and patting themselves on the back.” But “every precious moment and piece of energy and dollar you spend on this effort is money that could have been spent building brands.”

Lachky advocates for humorous ads, without any attacks, pointing to the car insurance business as one category that’s getting it right: “They really aren’t sniping at each other. They’re pretty much going with their own characters and developing their own icons in their own very unique voice. And that is what Bud Light needs desperately.”

Lachky also touches on the last big beer war that occured in the early 2000s, which involved then-American-owned Anheuser Busch attacking Miller Brewing for its foreign ownership after it was acquired by South Africa-based SABMiller. Lachky, who was involved in the A-B effort, admits it was a bad move.

“It was the worst mistake we could have made,” Lachky says on the podcast. “It got us off track of what we were really good at, which was having an unbelievable distinctive positioning for Bud Light and Bud at the time, too, because Bud was doing a lot of the great stuff like ‘Wassup’ and Louie the Lizard.'” (A-B InBev, which was formed in 2008 by Belgium-based InBev’s acquisition of U.S.-based Anheuser Busch, went on to acquire SABMiller in 2016; MillerCoors is now owned by Molson Coors.)

This year’s battle has gotten particularly ugly. Citing Bud Light’s corn syrup attack, MillerCoors last month pulled out of an industry wide effort aimed at improving beer’s image that could potentially include a brand-agnostic campaign.

While at A-B, Lachy was involved in one of the last major industry-wide campaigns. The 2006 effort, called “Here’s to Beer,” included broadcast TV and online ads and was intended to bring together multiple beer companies. But it later crumbled because A-B was not able to lure competitors aboard.

Miller “always felt we were only doing it for ourselves,” Lachy says on the podcast. But “our point was we’ve got to start talking about beer and its appropriateness in society.”

Coors Will Give You Free Beer Every Time It Gets Trolled by Bud Light

My Dearest Annabelle,

The Great Corn Syrup War rages on. I’ve been conscripted simply because I drink beer. I have grown tired, yet, the war proceeds onward even after Bud Light released a sort of apology about its Super Bowl ads. You remember, dear, the ones about corn syrup that most people thought were a little misleading. The very advertisement that played starter’s pistol to our current predicament. You’d be forgiven if you forgot. I believe we all fell asleep during the game whether from pure boredom or an overfull sensation brought on by one too many Takis Fuego.

Anyhow, Bud Light pushed on. They made billboards and more commercials touting their beer’s lack of corn syrup. (Even though all beer needs sugar and they get theirs from rice.) Miller Lite fought back. As did Coors, briefly. Now, Coors Light has full-on joined the melee. I fear that the Great Corn Syrup War will never end, pointless though it is. This Wednesday, March 13 in the year of our maker 2019, Coors has unveiled its newest battle plans. Every time Bud Light says something negative about Coors Light — for instance, mentioning the corn syrup Coors Light uses — Coors will give free beer to people across the country.

It works like this: Coors is installing light-up tap handles in bars that reside in New York, Dallas, Philadelphia, Las Vegas, and Omaha. When Bud Light trolls, the bewitched tap handles will light up with the fury of eight, maybe nine, candles. This happens in every bar in which they have been installed. Then, Coors says, the next round is on them. Drink up! (Though, one must not yell “Dilly Dilly.” Not because it’s a different brand, but just because, please don’t.)

Those of us on the frontline like free beer, of course. Who wouldn’t? But we fear our acceptance of this free beer means that the war will never end.

Cannabis Company Buys Colorado Brewery and Its CBD Beer Formula

For the past three years, Mason Hembree has been working on a difficult balancing act. He’s a craft beer brewer who feels more at home in the cannabis industry, a Libertarian iconoclast who is nevertheless trying to work within the system, and the owner of a tiny company who wants to play ball with the big boys.

Now, Hembree, who co-founded Dad & Dudes Breweria in Aurora in 2010, may have finally found the perfect nexus of those things. In late February, Hembree and his father, Thomas, sold their brewery to San Diego-based Cannabiniers, a company with big plans for growth.

The Hembrees also sold their unique intellectual property: the first and only federally-approved formula for brewing beer with CBD (a non-psychoactive hemp extract), as well as their patent-pending process for infusing that CBD into beer in a cost-effective way.

“We are a group of rebels who have this great experiment going and now we have new allies who understand our intention. We are happy they saw the value in it,” says Mason, who will continue to run the brewery. “Even though on paper, it is an acquisition, we really view it more as a merger.”

“It’s a no-brainer,” adds Cannabiniers vice president Kevin Love. “They have this formula that no one else has, and they really opened our eyes to how we could get behind it with the mass of our organization.”

Cannabiniers is a beverage marketing company that bought San Diego’s Helm’s Brewing, a traditional craft brewery, in early 2018 and then launched Two Roots Brewing, which makes non-alcoholic beers infused with THC, which is stuff in cannabis that does get you high. The company is currently in negotiations to purchase at least three other breweries around the country, Love says, including two with large brewing capacities.

The eventual goal is to sell Two Roots in every state that allows marijuana sales, but also to run traditional beer breweries and to make non-alcoholic beer.

“We are following consumer trends in adult beverages. We had those three verticals, and hadn’t planned to get into THC beer with alcohol,” Love says. But since CBD doesn’t have psychotropic effects and is often used by people for its health benefits, Love says there are “no adverse complications” there. And with Dad & Dudes TTB approval and pending patent, the opportunity was just too good to ignore.

Back in September 2016, Dad & Dude’s became the first – and only – brewery in the country to gain approval from the federal Alcohol and Tobacco Tax and Trade Bureau (TTB) for a CBD-infused beer. The bureaucratic process took about a year, because the TTB required a thorough analysis of the beer’s ingredients and its recipe before it would grant formula approval.

The beer itself, George Washington’s Secret Stash, made quite an impression, drawing long lines at the Great American Beer Festival, and Hembree announced plans to distribute it in other states. (It was named for Washington because the first president had grown hemp for its textile uses.)

But in December 2014, the U.S. Drug Enforcement Administration surprised the CBD and hemp industries by declaring that it still considered cannabidiol (CBD’s full name) and hemp extract – even if non-psychoactive – to be Schedule 1 substances, just like marijuana. As a result, the TTB asked Dad & Dude’s to surrender its formula.

Hembree refused to do that and hired the same law firm that has been representing the Hemp Industries Association in an ongoing federal lawsuit against the DEA that came about as a result of the agency’s December decision. He did stop brewing the beer, however.

Last December, Congress passed the 2018 Farm Bill, which removed hemp from the Controlled Substances Act (where it had been classified, along with marijuana, since 1937), something that made it legal for farms to grow it as a crop and for states to regulate its cultivation and sale. But its future, along with CBD’s, is still uncertain, as other federal agencies, including the Food and Drug Administration, have raised concerns.

Hembree, however, wasn’t waiting around. Last July 4, after an eighteen-month hiatus, Dad & Dude’s quietly began brewing George Washington’s Secret Stash again, using its patent-pending and TTB-approved process. “We are announcing this now because we believe the dam is breaking for antiquated cannabis laws,” Hembree said at the time. The beer, an IPA, is infused with 4.2 milligrams of CBD per pint.

Over the past year, several small breweries across the country have brewed CBD-infused beers without formula approval from the TTB – and received letters telling them to stop. Some of these cases, in Florida and California, in particular, received media attention. Since Dad & Dudes does have formula approval, however, the federal agency can’t exactly tell them the same thing.

“They [Dads & Dudes] are the only ones who are allowed to do it,” Love says. “It’s a huge opportunity and the intellectual property is going to be well protected for the next few years, I would imagine.”

He also notes that Cannabiniers will rely on the Hembrees and their staff to keep pushing things. “They are the DNA of Dad & Dudes, literally, and their greatest asset. It was their ability to be brave and go out and get approval from TTB, and to fight to maintain it…that got that organization to where they are today.”

Both Hembree and Love say they don’t plan to make an immediate changes but that the eventual goal is to scale up production of Dad & Dudes CBD beers, perhaps at the one of the breweries that Cannabiniers is currently in negotiations with. “We plan to move with diligence and thoughtfulness,” Love says.

Value Of Wine To Top $207 Billion By 2022, Forecasts IWSR Vinexpo Report

  • IWSR
  • March 13, 2019

Global consumption of still and sparkling wine is forecast to reach $207bn by 2022, for a total volume of 2.7bn nine-litre cases, reveals the latest IWSR Vinexpo report.

The total still and sparkling wine market will grow in volume by 2.15% between 2017 and 2022.

Driven by the trend to ‘drink less but better’, value outstripped volume growth across all regions. This is particularly evident in the Americas and Asia-Pacific. While volume and value advances in Europe were more moderate, the region continues to dominate global consumption and value shares at 58% and 50% respectively.

The US continues to inch forward as the world’s most valuable wine market, worth $34.8bn in 2017. France is the second most valuable market at $16.7bn, followed closely by China at third place at $16.5bn.

The Vinexpo/IWSR research predicts that China will overtake France by 2020 as the second most valuable market in the world. By 2022, the Vinexpo/IWSR study predicts that the value of the Chinese market is forecast to hit more than $19.5bn.

The ranking of the top five volume markets remained unchanged in 2017. The US was in the lead at 318m cases, followed by Italy (266m) France (250m), Germany (224m) and China (156m).

The world’s leading import markets are Germany, number one at 126.3m cases, followed by the UK at 114m cases. By contrast, the US (79.9m) and China (61m) ranked third and fourth continue to trend positively.

In the run-up to 2022, premium wines (priced at $10.00-$20.00) will be the biggest driver of value growth for still and sparkling wine (+15% between 2017 to 2022). The US and China will be major contributors to this trend.

While red wine dominates global consumption with a 55% share, it is forecast to fall below 54% by 2022. Over the same period consumption of white wine, and particular rosé, are set to rise.

Sparkling wine is putting fizz into the global market, especially in Europe which accounts for 65% of volume and 55% of value. World volume of 260.2m cases was worth $28.9bn. By 2022, volume is expected to rise to 281m cases, worth $32.9bn.

The US will drive imported sparkling wine growth over the next few years, by adding 4.6m nine-litre cases. Growth in the UK will slow. The Vinexpo/IWSR report that UK will add another 1.8m cases between 2017 and 2022. Both US and UK sparkling wine imports will be driven by prosecco, a major driver of sparkling wine consumption.

In value terms, the top five markets are the US ($4.5bn), France ($3.6bn), the UK and Germany ($2.7bn each) and Italy ($2.5bn).

While locally made spirits account for nearly 90% of consumption worldwide, international spirits are eroding this share, especially in China (baijiu) and Asia-Pacific (cane, brandy and rum). Between 2017 and 2022, consumption of imported spirits will grow by 12%, to reach 399m nine-litre cases.

Global spirits will inch forward in the run-up to 2022. Declines in vodka will be offset by big advances by whisky (65.9m cases), gin (9.5m) and flavoured spirits (2.4m).

Such is the strength of the trend to premium brands – especially in the US and China – that all premium-plus categories (except vodka) are forecast to grow over the next five years.

75% of millennials say they would spend more money on wine if they could and it’s shaking up the way companies like Walmart sell it (Link)

Millennials drank 42% of all wine consumed in the US in 2015, and winemakers are meeting the generation’s demands.

Online wine, beer, and liquor sales jumped in 2017, with wine accounting for 65% of all online alcohol sales.

Canned wine is gaining popularity too, thanks to millennials’ prioritization of convenience.

Companies like Walmart are entering the market with their own private labels. This series of wine will be priced to lure in bargain hunters, but still drink like a $30 or $40 bottle, similarly to Trader Joe’s Charles Shaw line.

Following is a transcript of the video:

https://www.businessinsider.com/millennials-changing-wine-industry-walmart-2019-3

Utah: Utah lawmakers reach a deal to put stronger beer in grocery stores, but it would be 4 percent, not 4.8 percent

Utah lawmakers have struck a deal to let higher-alcohol beer be sold in Utah grocery and convenience stores.

House members signed off on the measure Wednesday by a 61-14 vote, sending the bill back to the Senate for a final vote that is expected to occur Thursday.

This second substitute bill would boost the cap on retail beer from 3.2 percent to 4 percent by weight, a level that would include the majority of beer that already is in retail outlets, said bill sponsor, Sen. Jerry Stevenson, R-Layton.

“About 88 percent of the labels now in the stores would be able to stay,” Stevenson said, adding that it was a compromise “I can live with [it].”

Nationally, most light beers are 3.4 percent by weight, and dozens of others – such as Budweiser, Coors and Miller Genuine Draft – are 4 percent by weight.

The initial version of SB132 would have hiked the alcohol limit on retail beer from its current 3.2 percent by weight to 4.8 percent. Utah’s predominant faith, The Church of Jesus Christ of Latter-day Saints, opposed that plan.

Last week, that proposal, which already had been approved by the Senate, was gutted by a House committee and replaced with language that would create a task force to study the issue.

Wednesday’s version is a blend of the two bills. If the measure passes and Gov. Gary Herbert signs it into law, Utah’s 4 percent alcohol limit for retail store beer still would rank among the nation’s strictest.

“It’s a glass half full compromise,” said Kate Bradshaw, director of the Responsible Beer Choice Coalition. The group has been pushing for months to increase the state’s allowable alcohol cap on beer.

Under current Utah law, only beer that is 3.2 percent by weight can be sold in grocery and convenience stores. Stronger beer is offered in liquor stores operated by the state’s Department of Alcoholic Beverage Control.

In recent months, new alcohol laws have taken effect in Oklahoma and Colorado that allowed higher-alcohol beer to be sold in grocery stores. Kansas is not far behind; it will allow full-strength beer in stores April 1. That would leave Utah as the lone holdout on low-alcohol beer – unless lawmakers make a change before the legislative session ends Thursday.

The Complete Buying Guide to Buffalo Trace Whiskey: Important Brands and Bottles Explained (Excerpt)

There is perhaps no American whiskey maker more respected or awarded as Buffalo Trace Distillery.

The flags flying under its umbrella are some of the biggest names in whiskey – Pappy Van Winkle, E.H. Taylor, Weller and so on.

But the shuffling and mass coalescing of major whiskey brands can make it strenuous to know your Pappys from your Wellers, and harder still to recall the $1,000 difference between Antique Weller 107 and the Antique Collection’s William Larue Weller. That’s why we’re here. From impossible-to-find grails to $10 mixers, Buffalo Trace offers it all. Here’s your cheat sheet.

Mashbills

All Buffalo Trace whiskey comes from one of four recipes. In whiskey-making patois, recipe means mashbill, or the specific levels of corn, malt, rye and barley combined to distill the beginnings of every bottle.

The catch? The distillery has marked the exact balance of barley, corn, wheat and rye as proprietary (though many try to crack the code). So we know which bottles start as which mashbills, but we don’t know specific percentages of each ingredient. Some one-off expressions – like Van Winkle’s Family Reserve Rye – are exceptions to the rule.

Mash #1: a low-rye bourbon mash (Buffalo Trace, Eagle Rare, E.H. Taylor, George T. Stagg, Benchmark)

Mash #2: a higher-rye bourbon mash (Blanton’s)

Wheated Mashbill: replaces rye content with wheat (Pappy Van Winkle, Weller)

Rye Mashbill: mash made with a little more than 50 percent rye (Sazerac)

Pricing

Bottles from brands Pappy Van Winkle and W.L. Weller can cost hundreds of dollars, if you can even find them, but Buffalo Trace isn’t the one to blame. The distillery distributes all of its whiskey with longstanding suggested retail prices (SRP). Take Pappy, a brand with bottle prices that climb well into the four-digit realm. In an honest world, you’d be able to find one for as low as $60.

Prestige

The whiskey landscape is run almost entirely by a handful of conglomerates and mega-corporations, and Buffalo Trace Distillery stands out. Names like Van Winkle, Weller, E.H. Taylor and Blanton’s are some of the most sought-after bottles of brown on the planet, and that’s before mentioning the coveted Antique Collection and O.F.C. Vintage releases.

While all those names carry weight with collectors and award show judges, its humbler mainline bottles are no less noble. Dating back to 2000, Buffalo Trace and Eagle Rare – the brand’s two most available brands – have earned more awards than are worth counting.

https://gearpatrol.com/2019/03/13/guide-to-buffalo-trace-whiskey/

Washington: Craft distillers say they can’t survive without Olympia’s help (Excerpt)

To reach customers, makers of Washington spirits say they need more tasting rooms and fewer serving limits.

Ryan Hembree cradles a bottle of vodka in one palm, telling two customers about the 17 pounds of potatoes that went into it. The couple sits across from him, their stools pulled up to the bar Hembree and his cousin made from slabs of cedar.

Just a few feet away, the production floor of Skip Rock Distillers is piled high with pallets of local rye. Barrels of rye whiskey are stacked against the far wall, set aside to age. Lining the wall behind Hembree are bottles of his house-made raspberry liqueur, blackberry liqueur and nocino, a liqueur made from walnuts.

It’s all part of a movement craft distillers call “grain to glass” – the liquor version of “farm to table.” Like other craft distillers throughout the state, Hembree makes his spirits on site, primarily from raw materials grown locally in Washington.

“Working with the farmers and securing the raw materials, and seeing the raw materials come in – I love that part of it,” said Hembree, 45, who started his business in Snohomish 10 years ago.

https://crosscut.com/2019/03/craft-distillers-say-they-cant-survive-without-olympias-help

Beverages: Beer, Wine and Spirits – U.S. Advertising Spending Analysis: 4Q18

  • CITI
  • 13 Mar 2019

4Q Ad Spending for the Alcoholic Beverage Categories Decreased 12% YoY

Across the major alcoholic beverage categories, U.S. advertising spending decreased 12% YoY in calendar 4Q18, with much of the spending decrease coming from regular beer (-17% YoY), light beer (-28% YoY), bourbon whiskey (-14% YoY), and vodka (-17% YoY), while spending increased for wines & champagnes (+21% YoY) and tequila (+22% YoY).

Total Ad Spending Was Mixed for Our Coverage

For the alcoholic beverage companies under our coverage that we analyzed (SAM, BFB, STZ, and TAP), we saw mixed results in ad spending during calendar 4Q18.

SAM’s U.S. advertising decreased 49% YoY in calendar 4Q18 (to $10 mm), which compares to the -9% CAGR in 4Q ad spending over the last four years. SAM’s advertising spending decrease was driven in part by increases for Samuel Adams, Angry Orchard, Samuel Adams Light, and Samuel Adams Octoberfest, while spending for Samuel Adams Boston and Samuel Adams Winter increased.

BFB’s U.S. advertising increased 9% YoY in calendar 4Q18 (to $11 mm), although it represents a -10% CAGR in 4Q ad spending over the last four years. The quarter’s spending increase was driven in part by higher ad spending on the company’s whiskey portfolio, which was offset in part by decreased spending on cordials & liqueurs, tequila and Canadian whisky.

STZ’s U.S. advertising was up 17% YoY in calendar 4Q18 (to $102 mm), which represents a +26% CAGR in 4Q ad spending over the last four years. This quarter’s increase was attributable to higher ad spending for STZ’s regular beer segment, as well as higher spending for light beer and vodka, while spending for wine & champagnes decreased.

TAP’s U.S. advertising fell 42% YoY in calendar 4Q18 (to $63 mm), which represents a -12% CAGR in 4Q ad spending over the last four years. The decline was driven in part by lower ad spending behind Coors Light, Miller Lite, Blue Moon Belgian White, Coors Banquet, and Miller High Life, partially offset by higher spending for Coors.

Television Remained the Preferred Media Channel

For the alcoholic beverage companies that we analyzed, TV represented 87% of the total spend, although we note that the total spend does not capture the majority of digital ad spend.

Our Methodology

While these absolute figures may be incomplete and/or partly inaccurate, we nonetheless consider the relative changes to be relevant, and as such, we think it may be useful to compare ad spending and market-share trends to determine whether changes in dollars spent are reflected in market shares.

NIELSEN CGA: ST PATRICKS DAY IS THE HIGHEST GROSSING DAY OF THE YEAR FOR U.S. BARS AND RESTAURANTS

  • Nielsen
  • March 13, 2019

According to a recent Nielsen CGA analysis, St Patricks Day is the highest grossing day of the year for U.S. bars and restaurants. In 2018, St Patrick’s Day beer sales were up +174% and spirits sales up +153% versus the average day in the year. In fact, Nielsen CGA surveyed 15,000 on-premise visitors through its OPUS survey, and one-third of all US consumers stated that they visit a bar/restaurant on St. Patrick’s Day – marking this a major bar/restaurant holiday (only behind New Year’s Eve, Super Bowl and Valentine’s Day)

Matt Crompton, Client Solutions Director at Nielsen CGA:

“Given that St. Patrick’s Day will again fall on a weekend, on-premise retailers will be hoping for similar footfall and spend. In 2018, Saturday 17th delivered the greatest uplifts with average value sales for Beer +36% vs the previous Saturday, with Stout beers increasing a massive +355%. That said, despite being on a Sunday this year, the industry has every right to be optimistic that celebrations will stretch across the whole weekend.”

While the popularity of St. Patrick’s Day may not come as a surprise, Nielsen CGA has uncovered new insights that bring to light a hotbed of opportunities for U.S On-Premise establishments.

FOR ST. PATRICK’S DAY – CHICAGO AND BOSTON SHOWED THE BIGGEST SALES IN THE U.S. IN DALLAS, SAN FRANCISCO AND MIAMI… NOT SO MUCH.

Chicago & Boston were the major winners in 2018 on this day with the Windy City seeing beer uplifts of +221% vs 36% Total US. From a variety perspective, Stout performed well in both of these cities, with Chicago seeing an uplift of +688% and Boston seeing a lift of +355% vs the previous week.

when it comes to on-premise performance on St. Patrick’s Day, there are stark differences across cities in the US. The top 5 major DMAs for sales on St. Patrick’s Day (2018): Chicago, Boston, Washington DC, Los Angeles and New York. In contrast, sales are much lower in Dallas, San Francisco, Miami, Houston and Tampa with velocity actually down versus the previous week in Dallas and Tampa.

BRUNCH HAS EMERGED AS A GROWTH OPPORTUNITY FOR ST. PATRICK’S DAY

Focusing on day part performance during St. Patrick’s day weekend (2018), Brunch (9am-11am) showed the strongest growth for Beer vs the previous weekend, particularly on St Patricks Day itself where Brunch showed a huge uplift of +1465% making it a key area to focus on as consumers visit the On-Premise much earlier in the day.

Happy Hour still proves the most valuable day part for beer across St Patricks Day weekend. Although consumers visit the On-Premise earlier on St Patricks Day, there was still a +122% uplift from the mid-afternoon day part (3pm-5pm) and +12% uplift vs the previous Saturday showing consumers still wait for this part of the day to take advantage of the deals offered.

BEER AND BEYOND: BEVERAGES OF CHOICE ON ST. PATRICK’S DAY

During St. Patrick’s Day (2018), beer value increased by +20% vs the previous weekend with pubs and bars saw an uplift of +57% vs dining locations at +7%. Unsurprisingly, Stout value rose significantly with sales +141% versus the previous weekend. Other subsegments that also perform strongly on St. Patrick’s Day are: Domestic Premium which showed +80% growth, Import +52% and Cider +46%. Coupled with the growth of Irish Beer on St Patrick’s Day, we continue to see growth opportunities in Irish Whiskey. In fact, it is the fastest growing Whiskey type in the On-Premise, worth almost $2.1 billion in the last 52 weeks with value growing at 5.9% vs YA. In 2018, March was the strongest month for Irish Whiskey with value sales of $190 million, +6% vs YA and +22% higher than the previous 4-week period.

Nielsen CGA’s Crompton added: ” Our analysis of 2018’s St.Patrick’s Day performance shows that it isn’t just beer that wins, other categories have ample opportunity to win with consumers, too. For many, the key is to activate at the right time of day, with the right type of offering. In an age where experience is key, many consumers look to calendar moments (such as St. Patrick’s Day) to visit the trade. Having a well-stocked event calendar can be a great driver of footfall into bars and restaurants.”

OPUS is an in-depth survey of 15,000 On Premise consumers twice a year. A nationally representative census based on age and gender by state. Results from March 2018 and Fall 2018

CLIP is a first of its kind data set providing transaction level insights around sales performance across the US On-Premise. Data used for this release, daily from 01/01/2018 to 12/31/2018

NABI Elects New Chairman of the Board and Explores the Opportunities and Challenges of the 21st Century Global Market at its 84th Annual Meeting

  • NABI
  • March 13, 2019

Gabriel Bisio, General Counsel and Chief Compliance Officer of Palm Bay International was elected as Chairman of the Board at the 84th Annual Meeting of the National Association of Beverage Importers (NABC) in New York City. NABI President Robert Tobiassen said “We are pleased and fortunate to have Gabe as our Chairman for the next two years as he brings more than 15 years of alcohol beverage industry experience from his work with the Taub Family Company and before that Diageo North America. Gabe, an attorney with a vast international experience understands both the challenges of family and global companies, along with the diversity of the New World producers of wine, distilled spirits, and beers, and Old World traditions.”

Gabe follows Chairman Justin Kissinger now Director, Global Public Policy, HEINEKEN N.V., who commenced his NABI service when he was at HEINEKEN USA. The Board expressed its gratitude to Justin for his dedication.

NABI members at the annual meeting and working lunch focused on the three elements of our Strategic Goal and Plan for 2019 and Forward of (1) delivering business services to members grounded in our presence in Washington, DC with person-to-person contacts, (2) being a key information source for members of new regulatory developments and up to date market trends, and (3) networking with domestic associations and international organizations focused on streamlining trade and modernization regulatory regimes.

In helping to set the stage for the strategic goal discussion, NABI had the great benefit of insights from Susan Evans, Director, TTB Office of Industry and State Relations on where TTB is going and from Bobby Conroy, Wine Director, The Clock Tower, NYC, Court of Master Sommeliers, who helped us understand the dining consumer alcohol beverage selection experiences. For without an understanding of the consumer demand pulling imported products through the distribution system, there would be no imports.

NABI is the leading trade association for importers of distilled spirits, wine, beer, and low and non-alcoholic beverages in the United States. Established in 1935, in the wake of the Repeal of Prohibition, NABI has aided its members for eight decades in importing the widest range of products for American consumers to enjoy in a responsible manner. Recently, NABI has been the strong advocate for the import provisions of the Craft Beverage Modernization Act (CBMA) and worked closely with Customs and Border Protection on its implementation. Ease of administration and protection of the tax revenue are the guideposts of NABI’s efforts on CBMA. Today, there are more than 12,000 importer basic permits issued by the Alcohol and Tobacco Tax and Trade Bureau providing solid, well-paying jobs in every State and jobs that cannot be shipped overseas. “Delivering a WORLD of taste to AMERICA” is the NABI moto and goal.

9th Circ. Denies Aykroyd’s Vodka Co. $4.3M In Atty Fees

  • Law360
  • By Hailey Konnath
  • March 13, 2019

The Ninth Circuit on Tuesday shut down assertions by comedy legend Dan Aykroyd’s Crystal Head Vodka company that it was owed $4.3 million in attorneys’ fees and a higher payout in a suit over a rival’s use of bottle trade dress, ruling a lower court was correct in finding the case was not exceptional.

Globefill Inc., the maker of Crystal Head Vodka, should garner no more than about $872,000 in disgorgement of profits after a jury found its competitor Elements Spirits Inc. and founder Kim Brandi stole Crystal Head’s bottle design for its KAH Tequila, the three-judge panel ruled in a short, unpublished decision.

A California federal court correctly denied Globefill $4.3 million in attorneys’ fees, $13 million in disgorgement of profits and a bid to add tequila manufacturer Finos as another judgment debtor, the Ninth Circuit found, as the case isn’t “exceptional” under a U.S. Supreme Court standard allowing winning parties to come away with the fees.

“The district court did not abuse its discretion in concluding that this case was not ‘exceptional,'” the panel said. “In so concluding, the district court did not err in giving substantial weight to Brandi and Elements’ reasonable litigation positions while still considering the totality of the circumstances, including their intentional or willful infringement.”

Globefill first filed suit accusing Elements and Brandi of infringing its bottle trademark with the KAH Tequila bottles in March 2010, according to court filings.

In December 2013, following a trial, the jury returned a verdict letting Elements and Brandi off the hook, the filings said. In January 2014, Globefill motioned for judgment as a matter of law or a new trial, but the motion was denied.

However, Globefill got a break in February 2016, when the Ninth Circuit overturned the defendants’ victory, ruling that the district court should’ve given Globefill a new trial. According to the court filings, Elements had incorrectly referenced comparable legal proceedings during the trial. The next month, Globefill scored a win in its second jury trial.

In September 2017, a California federal judge granted a U.S. sales ban on KAH Tequila and more than $870,000 in disgorgement of profits to Globefill, despite the company’s request for $13 million.

U.S. District Judge Consuelo B. Marshall also denied the company’s request for $4.3 million in attorneys’ fees under a standard laid out by the Supreme Court in the 2014 Octane Fitness case. That standard says the winning party in a patent case can recover fees from “exceptional” cases. But Globefill’s case doesn’t qualify as “exceptional,” she ruled.

Globefill appealed the next month, and the case landed back in the Ninth Circuit.

The panel said without much elaboration Tuesday that the case was indeed unexceptional and therefore didn’t warrant the attorneys’ fees.

Additionally, the Ninth Circuit ruled, Globefill couldn’t add nonparty Finos as an additional creditor because Globefill didn’t show that Finos was the alter ego of Elements or that it controlled the litigation.

“Even on appeal, Globefill fails to identify any evidence in the extensive record showing that Finos controlled the litigation,” the panel said.

And the district court correctly calculated the amount of disgorgement profits owed Globefill, the panel said, finding “none of Globefill’s arguments to the contrary” were persuasive. Elements’ earnings came out to 8 percent of gross sales of KAH Tequila – $871,537 – based on a 2010 trademark assignment and royalty agreement, the Ninth Circuit said. Globefill had argued that agreement was an “arms’- length transaction,” but it failed to prove that, the panel said.

David Berg, counsel for Globefill, told Law360 on Wednesday that he was already pleased with the outcome of the case, but are mulling their next move.

“We are considering what our next steps will be,” he said. “We were thrilled with the [injunction] already.”

Counsel for Elements and Brandi didn’t immediately return requests for comment Wednesday.

U.S. Circuit Judges Mary M. Schroeder and John B. Owens and U.S. District Judge Dana L. Christensen, sitting by designation, sat on the panel for the Ninth Circuit.

Globefill is represented by David Berg and Zenobia Harris Bivens of Berg & Androphy and Hernan D. Vera of Bird Marella Boxer Wolpert Nessim Drooks Lincenberg & Rhow PC.

Elements is represented by Thomas G. Rafferty and Keith R. Hummel of Cravath Swaine & Moore LLP and James M. Lee of LTL Attorneys LLP.

Brandi is represented by Jon Miller of Miller Johnson Law.

The case is Globefill Inc. v. Elements Spirits Inc. et al., case number 17-56574, in the U.S. Court of Appeals for the Ninth Circuit.

Why the 21+ rule makes no sense for alcohol

Compared to other universities, Princeton takes a unique approach toward student alcohol consumption. Although “Rights, Rules, and Responsibilities” makes clear that underage drinking is illegal, the University does not penalize inebriated students who are checked into McCosh Health Center. Instead, the University reserves disciplinary action against students who fail to “McCosh” one of their very drunk peers.

Yet, even this generous policy, which prioritizes the well-being of students, does not necessarily lessen students’ tendencies toward binge-drinking or irresponsible drinking behavior. And many other campuses treat underage drinking more harshly.

Take Miami University, touted as one of the biggest “party schools” in the United States. Bars surround the Oxford, Ohio, campus. During orientation for new students, police officers patrol popular bars, and several students are often suspended for underage drinking, even before they have started classes. According to one report, “students said when the university and city police try to curb the drinking through discipline it forces [them] to go underground to avoid getting caught or they become more defiant and drink more aggressively.” Rather than dissuading students from consuming large amounts of alcohol, the stigma encourages it

I believe that the issue isn’t as simple as a lack of responsibility on the part of underage drinkers – though, admittedly, they do not help their case by drinking. Rather, we must consider how the 21+ rule inadvertently contributes to underage drinking.

Restricting alcohol to people who are over 21 years old creates an unnecessary taboo. For someone under 21, much of the allure of drinking lies in the fact that a rule can be broken. The “you can’t stop me” attitude, particularly strong among teenagers, contributes to students’ illegal consumption of alcoholic beverages.

Their “rebellion” often goes too far, as many teens (especially those in high school) are inadequately equipped to drink responsibly and in moderation. Their overconsumption often occurs in secret. The mentality surrounding alcohol needs to change, and people should begin to view its consumption as a pleasurable, social, and occasional activity, rather than something to abuse in secret.

Thus, I believe that the age restriction concerning alcohol should be lowered to 18. Why? Because in almost every other respect, 18 year olds are considered adults. They can enlist in the Army, they can vote, and they can serve on a jury. Since an 18 year old can die for her country and have a say in the trajectory of her government’s leadership, it seems wildly inconsistent that she cannot likewise drink.

And, with the taboo on drinking lifted, perhaps teens, now regarded as “adult,” will be more obliged to make responsible decisions concerning alcohol. To prove this point, we can examine other countries where the age restriction is not so high.

France has a minimum drinking age of 18, but that’s only in public. Many children grow up seeing their parents regularly drink wine at meals, and sometimes even sip alongside them. One article notes that “countries where drinking wine at meals is standard, including Italy, France and Spain, rank among the least risky in a World Health Organization report on alcohol,” despite being some of the most alcohol-heavy nations.

Furthermore, the negative cultural perception of alcohol in the United States may provoke more dangerous drinking. The article also mentions that binge-drinking among college students in the US was significantly more severe than drinking among students at French universities.

Thus, we should consider how the lessons we teach our children regarding alcohol shape their perception of its consumption. While the University’s alcohol policy does much to preserve the well-being of students who have drunk too much, it does not necessarily encourage moderation or responsible drinking.

The policy cannot erase a taboo established in early childhood. Therefore, if education surrounding alcohol consumption is employed early on, and if parents demonstrate to their children that drinking in moderation is a normal, everyday act, perhaps children would be less anxious to get their hands on liquor and less likely to drink in excess. And, on a Princeton-specific note, if, as in France, children and teens are shown what “good” alcohol is – like having a sip of wine to complement your meal – they will be less likely to grab the first watered-down beer they see.

Twerking, drinking, passing out on the beach – and taking cops off the border: How Spring Break resort with the ‘littest beach anywhere’ is calling in cartel-fighting police to keep college kids in line (Link)

  • Daily Mail
  • March 14th

Spring Break sees the sleepy island community of South Padre Island, which has just over 5,000 people, transformed as an estimated 100,000 college kids descend for a non-stop party on the Texas beach

For businesses and the city itself, the influx means a bumper payday with students spending $3.1 million on alcohol alone last year and providing South Padre with an overall windfall of $33.9 million

But DailyMail.com can reveal that the overwhelming numbers mean the local police department has to draft in officers from other Texas cities – among them border towns such as Los Indios

Police chief Jose De La Rosas, 30, says his small department frequently sends officers to South Padre – even though their area butts up against territory controlled by the notorious Golfos Cartel

In South Padre, the focus is more on keeping college students out of trouble and mitigating the worst of their excesses, according to the island’s police chief and interim city manager Randy Smith

There are outrageous antics, including ‘a**-luging’ – where beer is poured over a girl’s behind to be drunk by a boy – while men were seen handing out beads in exchange for a look at and a squeeze of women’s breasts

Brooke Patterson, 21, of the University of Kansas, said: ‘The whole week is full of people who just don’t give a f***. Come here right now, get lit with your friends – it’s the best vacation ever!’

Some boys told DailyMail.com the main reason they came to South Padre is to pick up women, with Hassan Boyer, 20, of Northern Illinois University, saying: ‘We’re going to make that baby and meet 30 years later’

https://www.dailymail.co.uk/news/article-6801249/Wild-college-students-spring-break-descend-South-Padre-Texas.html

AURORA CANNABIS – A DIFFERENT KIND OF DEAL

  • Cowen
  • March 13, 2019
  • THE COWEN INSIGHT

With ACB’s announcement to bring on Nelson Peltz as a strategic advisor, we focus on his ability to broker relationships with potential partners to fuel ACB’s expansion, rather than trying to invoke change to its existing business model. We look for ACB to be more methodical and patient in partnership selection than its Canadian peers. Maintain Outperform.

Key Points

ACB announced that it has appointed Nelson Peltz as a strategic advisor to work collaboratively with ACB to explore potential partnerships across multiple verticals. Peltz will also advise on ACB’s global expansion strategy. We note that Peltz has not been added to ACB’s Board of Directors at this time.

In consideration for his services, ACB granted Peltz the option to purchase ~20 mm common shares (~2% stake) at C$10.34 per share. The options will vest ratably over a four year period, but also capture an accelerated vesting schedule based on certain specified events, including certain defined transactions as well as thresholds for ACB’s stock price.

ACB’s arrangement with Peltz is a different kind of deal than we have seen among the Canadian cannabis peers. While WEED (STZ), TLRY (Sandoz, ABI, ABG) and CRON (MO) have partnered with established Fortune 500 companies, with WEED/CRON conceding significant equity stakes, ACB has thus far remained independent and is bringing on an advisor to help plan out its next phase of growth. In light of Peltz’s past deals as an activist, we do not view the announcement as a step towards driving change to the existing business model (e.g., not a break up story). Rather, Peltz brings a network of relationships with large potential strategic companies that ACB could partner with across medical and consumer applications. In addition, we think ACB will be more patient in partnership selection than its peers, particularly regarding equity investment.

TOBACCO – DRAFT REGULATIONS IN-LINE WITH EXPECTATIONS

  • Cowen
  • March 13, 2019
  • THE COWEN INSIGHT

We view the FDA’s draft policy as a continuation of its previously announced plans in November 2018 and in-line with our expectations. While the move to restrict flavors from traditional retail channels is likely a headwind to BATS and IMB, JUUL / MO has already taken these steps which, if anything, levels the playing field.

Key Points

Outgoing FDA Commissioner Scott Gottlieb released the agency’s draft policy restricting e-cigarette sales. In particular the regulations are focused on a few key areas. First, FDA will have the authority to pull flavored e-cigarettes (other than tobacco, mint and menthol) off the market completely. Second, for those flavors that do remain on the market (again, other than tobacco, mint and menthol), these products will no longer be permitted to be sold in traditional retail channels and would be restricted to sales through vape shops, age-restricted stores or online. In addition, the FDA will require that these products obtain premarket authorization by August 2021, one year earlier than previously. Finally, flavored cigars introduced after 2016 without FDA clearance will be subject to new enforcement action, including possible removal from the market.

We view the guidance as being largely in-line with the FDA’s previously announced plans in November 2018. That said, the FDA will continue to ensure that proper age verification and gating take place both in brick-and-mortar locations as well as online. Thus, retailers and/or manufacturers could still see their products removed should the FDA deem improper oversight.

We note that today’s guidance did not include any regulations of menthol combustible cigarettes. Previously, the FDA indicated in November it would advance a Notice of Proposed Rulemaking to ban menthol cigarettes. As further regulations could come at any time, we do not consider this issue to be off the table, particularly while Gottlieb is still in office.

From a stock perspective, these regulations would be a net headwind for both BATS and IMB, who have yet to remove their flavored products from the market. However, we think this is largely baked into the stock price. For JUUL / MO, we do not see a significant incremental impact from these regulations as JUUL has previously taken steps to restrict their flavor sales consistent with these policies. If anything, one could argue that these actions help level the playing field for JUUL and allow for sales in comparable distribution channels. Maintain Market Perform on MO ($55.75), BATS (3,086.0p) and IMB (2,630.5p).

‘Deeper uncertainty’ for spirits after Brexit deal rejected

The rejection of UK prime minister Theresa May’s “flawed” Brexit deal throws the wine and spirits industries into “deeper uncertainty”, the Wine and Spirit Trade Association has warned.

May’s deal was defeated in the House of Commons again yesterday (12 March) by 149 votes.

MPs will return to the Commons this evening to vote on another Brexit motion, this time deciding whether Britain should leave the European Union without a deal. If MPs vote for no-deal, the UK will leave on 29 March without a deal, automatically reverting to World Trade Organisation trade rules.

Miles Beale, chief executive of the WSTA said: “The rejection of the prime minister’s flawed Brexit deal throws wine and spirit businesses into yet deeper uncertainty; and for longer.

“With the Brexit deadline only a fortnight away it is imperative that MPs vote this evening – and then legislate – to avoid ‘no deal’. Whatever happens next it’s clear that an extension to article 50 is required, which the UK government and the EU should agree as soon as possible.”

Ahead of the vote, the UK government announced this morning (13 March) that tariffs will be temporarily abandoned or slashed on almost all imports after a no-deal Brexit and there will be no checks at the Irish border. This would apply if the UK leaves the EU without a deal on 29 March.

The UK government said it recognises that businesses in Northern Ireland “will have concerns about the impact that this approach would have on their competitiveness” and will “remain determined to secure a deal and an orderly exit from the EU”.

Beale added: “We welcome the decision that there would be a temporary suspension of tariffs on wine and most spirits under ‘no deal’, which the WSTA called for earlier this year.

However he said that “far more” needs to be done to “ensure a free flow of trade” for wine and spirits firms.

Beale said: “Action is urgently needed to resolve questions related to customs arrangements, border controls and migrant workers in order for businesses to keep trading.”

Latest Brexit Headlines

  • Multiple
  • March 14, 2019
  1. https://www.telegraph.co.uk/politics/2019/03/13/revealed-plot-delay-brexit-two-years-cabinet-ministers-betray/
  2. https://www.dailymail.co.uk/news/article-6806245/How-long-Brexit-delayed-cancelled-second-referendum.html
  3. https://www.dailymail.co.uk/news/article-6803599/Fifteen-Brexiteer-ministers-threaten-QUIT-force-job.html
  4. https://www.telegraph.co.uk/politics/2019/03/13/brussels-will-tell-theresa-may-ask-long-brexit-extension/
  5. https://www.telegraph.co.uk/politics/0/extending-article-50-could-inevitable-consequences-delaying/
  6. https://www.telegraph.co.uk/politics/2019/03/14/happens-next-now-no-deal-brexit-table-remaining-options-explained/
  7. https://www.dailymail.co.uk/news/article-6806045/Pound-ROCKETS-two-year-high-against-euro-surges-against-dollar.html

TTB Slated Over Wine Labeling

Do you know how many calories are in your glass of wine?© Reader’s Digest | Do you know how many calories are in your glass of wine?

Consumer advocates demand both calorie and nutritional information should be on wine labels.

Consumer groups are putting pressure on the TTB to include more information on wine labeling.

The Center for Science in the Public Interest (CSPI), the Consumer Federation of America (CFA) and the National Consumers League (NCL) recently sent a letter to Treasury Secretary Steve Mnuchin criticizing the Tobacco Tax and Trade Bureau (TTB) for not providing more detailed information about wine’s alcohol content, calories and ingredients. The Secretary did not respond in time with comments for this story.

Members of all three organizations noted that while food producers and restaurants are currently striving to provide this type of information, wine producers and their regulators have been slow to come to the table with similar facts.

“Consumers want to know what is in their food,” notes Thomas Gremillion, the director of food policy at CFA. “Consumers should not have to forego those preferences, or make heroic research efforts, when purchasing a product just because it contains alcohol.” An additional concern, he adds, is the fact that “more than 70 percent of American adults are now overweight or obese. Alcohol is a leading source of calories in the American diet. According to one recent government report, alcoholic beverages are right up there with ‘starchy vegetables’ for calorie contribution to the American diet.”

The NCL spokesperson was also negative about the TTB’s history of not providing additional nutritional information on wine bottles. “The TTB has an unfortunate and very long history of foot dragging on nutritional labeling on alcoholic products. The agency – regardless of which administration is in power – and despite congressional mandates, fails to require nutritional and allergen labeling on alcoholic products,” shares the NCL’s food safety and nutrition fellow Shaunice Wall.

The TTB could not comment on the request at the time. “We are still in active rulemaking on Notice No. 176,” shares Thomas Hogue, the director of congressional and public affairs at the TTB in Washington DC. He adds that he “cannot comment beyond noting that we have included the letter and attachment as a comment in public record. The comment period for this rulemaking runs through March 26, 2019. We encourage all interested parties and stakeholders to submit comments for the public record while the comment period is open.”

The end goal

As the food industry has continued to be more forthcoming about calorie contents of comestibles, the wine and spirits industry is being held equally accountable by consumers and their organizations. “These consumer groups aim for uniformity in labels across all commodities,” shares Robert Tobiassen, an attorney who worked for many years at the TTB.

“The vast majority of consumers support mandatory labeling, alcohol is a significant source of calories, we need this info to follow the dietary guidelines advice on calorie limits,” says Sarah Sorscher, the CSPI’s deputy director of regulatory affairs.

She adds: “Consumers care very deeply what goes into our food and drink and we don’t stop caring about our bodies and our health just because we’re drinking wine or other alcohol.”

Wall empathizes buyers’ interest in the nutritional information about what they purchase and consume. “As consumers are becoming more health conscious, it is up to the TTB to regulate the practice of transparency and accountability in nutrition labeling for alcoholic beverages,” says Wall.

“There is plenty of room on the labels [of wine bottles] for nutrition, alcohol and ingredients information.. The real question is whether winemakers are willing to alter the aesthetic image of their labels with an easy-to-read disclosure. It’s clear from the lack of action to date that few winemakers are willing to take this step unless it’s required of them,” says Sorscher.

The long-term prognosis

The future of labeling, across categories, is likely to be dictated by consumers. “The fundamental question is what info does the consumer need and want. You don’t want to require unnecessary elements of info because that leads to label clutter for the consumer,” says Tobiassen.

“I don’t think consumers are particularly well informed about the calories in alcohol,” concurs Boucard Nesin, a beverage analyst at Rabobank’s New York City office. “The big question is whether the labeling would have a meaningful impact on consumer behavior.. Consumers often believe red wine is healthy, but they think calories are bad. I am not sure which narrative would win the battle in the minds of consumers.”

In the long run he adds that, “I am not sure how much these labels will help consumers moderate alcohol intake [however] . the main factor that would affect consumer behavior is calorie counts, not serving sizes and alcohol content.”

Overall, other industry analysts also find current labeling requests to be fairly reasonable. Christian Miller, the proprietor of Full Glass Research in Berkeley, California says that he finds these demands to be “less dire and prohibitionist than some of the CSPI sponsored lobbying in the past. In the past, most anti-alcohol lobbyists were opposed to even suggesting on the label that some alcohol consumption was OK. The proposed warning label essentially gives a government OK on moderate drinking.”

He adds that this type of information on a bottle might well be helpful as “it’s quite unlikely that most consumers have typical wine calorie counts memorized.”

Bulk Wine Prices Ease on the Central Coast

About 20 million gallons of bulk wine are for sale statewide, a result of a record 2018 harvest and slowing wine case sales, according to Turrentine Brokerage.

There are more than 4 million gallons of Cabernet Sauvignon for sale on the bulk market statewide. “it is available from everywhere. We’ve seen pricing come down as much as 50 percent or greater,” William Goebel, broker at Turrentine Brokerage, said Tuesday at Central Coast Insights in Paso Robles. Goebel and Audra Cooper, broker/partner at Turrentine Brokerage, were among the speakers who gave an overview of the bulk and grape market.

Cooper expects this year’s statewide crop to total a record 4.4 million tons. “It looks like it is going to be a historical crop,” Cooper said.

The preliminary California Grape Crush report was not released in February due to the partial government shutdown. Instead the final report is scheduled to be posted April 10.

Still, tonnage from the 2018 harvest is projected to be up in all main growing regions, including the North Coast and the Central Coast, according to Turrentine. Tonnage crushed for Chardonnay, Cabernet Sauvignon, Pinot Noir, Merlot and Zinfandel increased in 2016 and 2017.

“And I don’t think there will be any exceptions this year,” Cooper said.

Goebel said there are new buyers and options for buyers. “This is also the new dating time when you can start looking at new relationships,” Goebel said.

There are just under 3 million gallons of Chardonnay on the bulk market statewide, Goebel said. Demand is “moderate to slow,” he said.

The Chardonnay bulk wine supply from the Central Coast is greater than anywhere else, according to Turrentine.

Chardonnay’s grape market in the Central Coast continue to grow in size in the summer and early fall. “Unfortunately prices did plummet as we got closer to harvest,” Cooper said.

Goebel said there are just under 2 million gallons of Pinot Noir on the bulk market statewide.

Most of the Central Coast Pinot Noir fruit comes from Monterey County, according to Turrentine.

Monterey County has been the “sweet spot for both quality and price,” Copper said. Producers who want to start a new label look at Monterey Count as a place to go to, she said. Supply has started to stack up. “So now is the opportunity to start those new labels If you can if those opportunities still exist.”

Who owns those gallons on the bulk wine market statewide? “A lot of the big wineries are now sellers of bulk wine which is limiting their volume movement in this market,” Goebel said.

Cooper said “Another huge dynamic change has been the acquisitions that have occurred over the last 10 years has really started to limit the buyer pool for both bulk wine and grapes.” That trend is likely to continue she said.

Large Cabernet Sauvignon crops are anticipated in the future in Paso Robles, barring heat waves or serious frost conditions.

After all, bearing acreage for Cabernet Sauvignon has increased from 9,800 acres in 2011 to 14,000 acres in 2017, Cooper said. There may be as many as 17,000 bearing acres in Paso Robles in 2020-2021, she predicted.

Craig Ledbetter, vice president and partner at Vino Farms, said there were 35 consecutive days of 100 to 105 degrees Fahrenheit -if not hotter – in Paso Robles. Farmers who fall behind in their irrigation schedule in Paso Robles run the risk of losing their crops – and their vines. Water was available in the ground. So, he irrigated to keep the vines healthy. Considering the heat, Ledbetter was “extremely surprised” by the production, he said during a panel discussion at Central Coast Insights.

But at the same time, there are a lot of new bearing acres. “New acres always produce more,” Ledbetter said.

Old acreage not producing enough fruit to make the farmer financially sustainable ought to be removed, he said.

“You always hear ‘don’t plant without a contract,'” Ledbetter also said.” But left and right, we’re guilty. We do it anyway.”

“Now we’re going to ride the boat on getting it back into a decent supply.”

Michael Haddox, senior winery relations manager and winemaker, Central Coast, at Agajanian Vineyards and Wine Co., listened to the discussion.

He, too, agrees older vineyards need to be removed. “I’m seeing it out there,” he said.

There is an oversupply of fruit on the Central Coast – and one can argue in California, Haddox said. There is an oversupply and a lack of buyers in the Central Coast, he said. “That has led to extremely low prices,” he said. “There is no silver bullet.”

“We’re just in a state of flux right now. We’re going to come back out,” he said.

Chinese media investor buys historic Bordeaux estate

An Asia-based media businessman identified only as ‘Mr Chen’ has purchased Château de Cadillac-en-Fronsadais and its wine stocks for an undisclosed fee, according to the deal’s brokers.

  • Decanter
  • Chris Mercer
  • March 13, 2019

Mr Chen, an Asian investor in telecoms, media and technology sectors, has bought Château de Cadillac-en-Fronsadais from the Australian Serisier family, said Vineyards-Bordeaux, which brokered the deal.

The AOC Bordeaux estate is based in Cadillac-en-Fronsadais north-west of Libourne and has been built up by the Serisiers since they acquired an historic house known as Château Cadillac in 2004.

The property traces its history back to the first Baron of Cadillac, created by King Edward II of England in 1307, said Vineyards-Bordeaux, which is an exclusive affiliate of Christie’s International Real Estate.

The deal is the latest in a long-running series of Bordeaux winery purchases by Asia-based investors, who have typically opted to buy into lesser-known appellations and areas.

Having started with three hectares of vines, the Serisiers spent several years acquiring neighbouring plots and launched their own wines in 2011.

Wines currently produced include ‘Le Bout du Monde’, which is a 100% Merlot from a vineyard of the same name, and ‘Château Montrevel’.

As Decanter’s Jane Anson reported last year, using the ‘Cadillac’ name proved tricky for the Serisiers, given the existence of a Château de Cadillac in Cadillac Côtes de Bordeaux.

After visiting the Serisiers last year, Anson reported, ‘The wines have clear potential, and are particularly succulent in the 2015 and 2016 vintages, as you would expect, with my favourites being the liquorice-filled Montrevel 2015 and Le Bout du Monde 2016, with its prominent fruit and saline lick on the finish.’

Little was revealed about estate buyer ‘Mr Chen’, although Vineyards-Bordeaux said that he got in touch via Christie’s auction house in China and was keen to continue investing in the property and its vineyards.

‘It’s a dream come true for me to become a part of such a privileged history and participate in my passion for wine through such high quality terroirs,’ Vineyards-Bordeaux quote Chen as saying.

Millennials buy more wine online and want it to be organic

Across food and beverage, consumers are demanding transparent supply chains. They want to know what goes into products before they purchase and consume them, and have made a push for more organic and sustainable choices.

It’s a movement led by millennials, who are more likely to adopt ‘healthy’ trends like biodynamic farming and diets like keto and paleo. Young people are also finding more ways to buy their groceries online, shopping for globally-inspired flavors and a roster of healthy food in general

A climate change positive?

This has bled into the wine category in a major way, according to Alan Beasey, Sommelier and Head Bartender at The Purple Pig in Chicago. He told BeverageDaily that restaurant patrons now ask for organic wines ‘all the time.’

“People that come into the restaurant are very interested in making conscious choices about what they’re eating and what they’re drinking. They get excited about knowing where things come from and how things are produced,”? he said.

“They lean toward and focus on local produce for food choices. A big category for wine is natural, organic, sustainable production methods.”?

Organic wine only accounts for about 3.6% of global wine consumption, but it’s a fast-growing movement?. Beasey said it’s important that more winemakers are turning toward organic and biodynamic practices to preserve the vineyards and soils, and also believes that it improves the quality of the wine.

He thinks this shift is born partly from the effects of global warming and climate change, as a lot of old winemakers with centuries of tradition are looking at these changes in weather patterns and climate as an opportunity, more than as a limitation.

France’s Domaine de la Romanée-Conti, widely considered to be one of the world’s best wine producers, famously converted to biodynamic farming in all of its vineyards, inspiring other winemakers to take on the complicated and expensive process for getting the most out of their land.

Consumers are responding to this by asking for more label transparency? in their alcohol and for options that reflect sustainable and biodynamic practices.

“It pushes the industry to make changes; it pushes us to be more conscious about the wine we’re sourcing and that I’m buying. I look for these things now, and it’s important to me,”? Beasey said.

Reviving global wines

An interest in foreign market wines is expected to flourish in 2019, and Beasey reports that even the landlocked midwest is seeing an influx of options beyond classics like France, Italy and Napa Valley.

Germany and Austria are producing more red wines than usual, which require a longer growing season and warmer temperatures. Beasey thinks more “interesting and good quality wines”? are coming out of central Europe, like from Georgia and Hungary.

Unfortified, dry wines are being explored by Portugal, which is well-known for Port and other sweet dessert wines. And Lebanon, Armenia, Bulgaria, Croatia and Slovenia are all ramping up their winemaking abilities as well.

“Some of these countries were under the former Soviet umbrella, and they have just now started to get their wine and beverage industries back on track after decades of being held under the thumb of the former Soviet government,”? Beasey said.

“It took until now for some of these countries, like Armenia, Georgia and Bulgaria, to revive what was a centuries-old winemaking tradition that never really died, but it was in hibernation for a long time.”?

Beasey said that the Fertile Crescent area of Eastern Europe and Western Asia is home to “a great bedrock of winemaking”? that is “being re-awoken.”?

The dreaded ‘wall of wine’

To enjoy these ‘re-awoken’ wine markets, US millennials are turning to the internet. Wine.com sold 38,000 different wines in 2018 from 5,500 wineries, and millennials now make up one-third of the site’s shoppers.

Rich Bergsund, CEO of Wine.com, said “Mobile is the best thing to ever happen to wine retailing. It puts the power of wine scores, write-ups, videos and our live chat experts right in the hands of our customers — helping them discover and enjoy wine with confidence, wherever they are.”?

Wine.com launched a mobile app in mid-2017 and mobile revenue has since grown to represent 30% of total revenue. Mike Osborn, founder and executive VP of Wine.com, credits the success to young consumers’ disdain for in-person shopping: “Millennials will not put up with the dreaded ‘wall of wine’ at retail,”? he said.

With consistent annual growth of 15%-20% over the last few years, Wine.com‘s success represents the public’s desire to make it easier to purchase alcohol online. Wine has seen a more complicated path to ecommerce than most other food and beverage products.

Wine.com will start sharing its online wine purchase data with Nielsen to make the channel more transparent, and to “measure, predict and activate on insights to improve performance within the wine category.”?

Beasey of The Purple Pig finds all the latest shifts in wine consumers’ behavior helpful to the restaurant and bar industry, even with the rising popularity of ecommerce.

He said, “It helps make us better when our guests are better informed, and when consumers are more engaged and enthusiastic about trying new things. It motivates us and keeps us always trying to improve and come up with the next thing.”?

TUSCAN WINE GROUP SAVES CHIANTI COOPERATIVE FROM BANKRUPTCY

Tuscan wine group Tenute Piccini, owned by the Piccini family, has acquired historic Chianti cooperative Chianti Geografico in a deal worth ?7.2 million (£6.2m).

The wine group made the announcement during a conference in Florence last week. Founded in 1961, Geografico is based in the municipality of Gaiole and is the oldest cooperative in the region.

According to Giacomo Panicacci, brand ambassador for Tenute Piccini, the $7.2m sum does not include the amount the wine group intends to spend on improvements. The improvements include the renovation of the cooperative’s barrel rooms and winery and the installation of new machinery including smaller tanks for micro-vinification.

Commenting on the deal Mario Piccini, owner of Tenute Piccini, said: “We are very satisfied because it was a great deal in which we were able to save not only the prestigious name of Geografico, but also, and above all, the company with its employees and growers.

“This deal fill us with pride and an awareness of the important responsibility that we now have. Geografico is a big name in Tuscany which not only represents the historic region of Chianti, but also carries within it an extraordinary suitability for the production of high quality wines.

“Thanks to our agreement with Banca IFIS [an Italian bank] we’re able to give assurance to growers who have already paid the price for the company’s past troubles.”

Tenute Piccini has been managing Chianti Geografico for the past two and half years and has now assumed full ownership. The cooperative employees 16 people and works with 60 growers, processing 1,550 tonnes of grapes last year. Tenute Piccini employs a total of 67 people and produces 16 million bottles a year, turning over ?64 million last year.

Mario Piccini announced the deal alongside viticultural consultant Riccardo Cotarella, president of both Italian winemaking association Assoenologi and international winemaking association Union Internationale des Oenologues and the brother of Renzo Cotarella, CEO of Antinori, and Piccini’s winemaker Alessandro Barabesi, formerly of Frescobaldi.

Tenute Piccini has also been working with Banca IFIS since June 2018 in order to strengthen its support of the local vinegrowers, providing faster payments and free technical consultancy.

For Austrian Wine, 2018 Was A Record-Breaking Year

At home and around the world, more people are buying Austrian wine, proven by a record-breaking year of sales in 2018. According to a press release from the Austrian Wine Marketing Board (AWMB), worldwide export figures registered ?170.3 million, up 6.9% over 2017. Germany, Switzerland and Liechtenstein and the U.S. were the dominant foreign consumers of Austrian wine in 2018.

“Non-EU markets, whose share of total export value for 2018 reached almost 30%, made a notable contribution to the outstanding figures,” states the AWMB, citing growth in the U.S. (+19.7% volume, +21.2% value) and Canada (+66% volume, +62.6% value).

Partly responsible for the uptick was a bountiful harvest in 2017, with a 10.5% increase in volume resulting in 52.6 million liters of wine sent to export. In a year when much of the world suffered decreased yields, Austria experienced abundance. “True, there were late frosts in 2017 as well as hailstorms, but both caused substantially less damage than in the previous year,” states a report from the AWMB. “Only the Weinviertel experienced a more modest harvest compared with the average, due to extremely arid conditions in one of the hottest summers in a long time.”

Meanwhile, Austrian wine sold well to consumers at home with a 6.9% jump in the retail grocery trade. According to a report from the AWMB, “the market share of Austrian wine in this sector rose to more than 70%.”

Austrian wine is made from 40 approved grape varieties led by Grüner Veltliner, Zweigelt and Blaufränkisch – 26 white and 14 red. These are mainly grown in the federal states of Niederösterreich, Burgenland and Steiermark as well as 17 other wine regions, including Wien and Bergland (Kärnten, Oberösterreich, Salzburg, Tirol, Vorarlberg). It is a requirement that the origin of the wine is indicated on the label, and some of the official language may appear on the back. Austrian wines are made in a diverse range of styles including sparkling Sekt and dessert wines as well as red, white and rosé still wine presented in a scope of profiles.

Earlier this year four new fungus- and rot-resistant hybrid grapes were approved for use in Austrian Qualitätswein (quality wine), reflecting a global effort to introduce varieties that can adapt to climatic considerations, reducing the need for treatments. 13.5% of vineyards are certified as organic or biodynamic, and according to the AWMB, “means of production keenly focused upon sustainability are gradually establishing themselves to a greater degree in our vineyards.”

BJ’s Wholesale Club Launched Its Own Wine Line And Bottles Start At $7

Gone are the days of having to separate your grocery store and wine runs. You can now find quality wines everywhere from Trader Joe’s to Aldi to Sam’s Club (with the exception of cities that still separate the two-sorry, guys). Besides the convenience factor, when grocery stores make their wine in-house, it’s often cheaper than what you’d find at a liquor store. The latest market to join the party is BJ’s Wholesale Club.

BJ’s-the eastern equivalent of Sam’s or Costco-just debuted its own line of wine within its private Wellsley Farms brand. The BJ’s-exclusive collection features five different wines made in Argentina, California, Italy, and New Zealand. While prices can vary by state, the whole lot is under $10. Here are the deets:

Wellsley Farms Malbec: starting at $6.99

Wellsley Farms Pinot Grigio: starting at $6.99

Wellsley Farms Prosecco: starting at $7.99

Wellsley Farms Cabernet Sauvignon: starting at $7.99

Wellsley Farms Sauvignon Blanc: starting at $7.99

You’ve got white, red, and bubbly, all available for less than the price of one single glass of wine at any bougie wine bar-what a dream. To note, only certain BJ’s locations carry alcohol (those that do may also have beer and liquor), so check their store locator to find the closest one to you if you want to try the new wine.

If the cheap bottles are encouraging you to host a wine and cheese night (or just to have wine and cheese for dinner, I get it), BJ’s conveniently listed the prices for other party-friendly buys alongside the news about the wine collection. The Wellsley Farms line includes an $8 four-pack of entertainment crackers and a $10 cheese sampler platter. You can also find 100 clear cups for $9 and a 12-bottle wine cooler for $130, should you be looking for a new wine storage option. Both can be found in-stores and on BJ’s website.

Ex-Pernod director joins Amber Beverage as CMO

Amber Beverage Group has appointed former Pernod Ricard employee Pepijn Janssens as its new chief marketing officer (CMO).

Janssens previously worked as global commercial director for Our/Vodka before joining the Rooster Rojo Tequila owner.

As CMO, Janssens will be responsible for driving value growth for brands across Amber Beverage Group’s drinks portfolio, including Moskovskaya Vodka, Riga Black Balsam, Cross Keys Gin, low-abv sparkling beverage Cosmopolitan Diva, and others.

Seymour Ferreira, Amber Beverage Group CEO, said: “In 2019, we will see an increasing need to focus on driving our international businesses and brands.

“Innovation will become a core driver of our business and global marketing will be an important focus point.

“Therefore, having Pepijn Janssens on our executive board will bring extra big ideas, bold solutions and thoughtful strategies.”

5th Annual Chicago Rum Festival Returns April 27 (Excerpt)

TheRumLab.com will celebrate the 5th Annual Chicago Rum Festival (Previously the Midwest Rum Fest) on Saturday, April 27 at Logan Square Auditorium (2539 N Kedzie Blvd) in Chicago with more than 50 rum expressions poured.

Guest speakers include:

Richard Seale – “Lessons in Rum” – Fourth Generation Master Distiller, Foursquare Distillery, Barbados

Bailey Pryor – “A Real Conversation About Rum: everything a true rum lover should know”- 5 times Emmy Award winning documentary film producer and CEO of The Real McCoy Rum.

Jeff “Beachbum” Berry – “Brigands, Barons & Beachcombers: The Many Faces of Planter’s Punch” – One of Imbibe magazine’s “25 Most Influential Cocktail Personalities of the Past Century” and one of The Daily Meal’s “60 Coolest People in Food & Drink,” Jeff “Beachbum” Berry is the author of six books on vintage Tiki drinks and cuisine, which Los Angeles magazine dubbed “the keys to the tropical kingdom.” Esquire calls him “one of the instigators of the cocktail revolution” and Food & Wine “one of the world’s leading rum experts,” while Las Vegas magazine cites him as “one of the world’s leading mixologists.” Jeff’s been profiled in the New York Times, the Washington Post, Wine Enthusiast magazine, the New Orleans Times-Picayune and the Florida Sun-Sentinel; he’s also been featured in the Wall Street Journal and Every Day with Rachael Ray, as well as on PBS Television, National Public Radio, Martha Stewart Living Radio and Radio Margaritaville.

Zan Kong – “Jamican Rum” – Over the course of the next 10 years, Kong has worked through various departments (Food and Beverage, Front Office, Guest Relations etc.) in different operations in Jamaica, Turks and Caicos and Florida. Which brought him to his current role as Export Sales Manager for Worthy Park Estate.

David Cid – “Taking a closer look at Rum” – David is focused on translating the science, art, and complex history of rum into educational sessions for consumers, journalists, and bartenders that range from rum tastings to in-depth discussions on the production of rum. He also puts his skills to use by training in the sensory analysis of rum, and serving as a point of reference for media. He has been featured on Univision, Fusion TV, CNN Radio, amongst other media outlets. He has consulted on the development and launch of various rums including the Single Cane Estate Collection and the Facundo Rum Collection.

http://www.chicagofoodmagazine.com/news/5th-annual-chicago-rum-festival-returns-april-27-2

eMarketer: Amazon Prime memberships to reach more than half of U.S. households

  • CSA
  • DAN BERTHIAUME
  • March 12, 2019

Amazon Prime continues growing in the U.S. at an impressive clip.

By the end of 2019, 51.3% of U.S. households will belong to Amazon Prime, according to a new forecast from eMarketer. That represents 63.9 million households, up from 58.7 million households (47.4% of total) in 2018.

And eMarketer does not expect the growth rate in Amazon Prime memberships to slow in the next couple of years. Membership rates are expected to reach 54.8% of U.S. households – 68.7 million – in 2020, and 56.9% of U.S. households – 71.7 million – in 2021.

According to eMarketer, growing participation of lower-income households and consumers attracted to the platform’s new offerings are helping fuel Amazon Prime’s rapid growth in the U.S. eMarketer also cites value-added services beyond free, fast delivery, such as Amazon Household. This offering allows members to share Prime benefits across linked accounts for up to two adults, four teens, and four children 12 or younger. Other benefits of Amazon Household include parental media controls and targeted discounts on household staples.

“New membership is driven by the company’s continuous expansion of Prime product categories, like groceries, apparel and pantry – as well as new options for media consumption, like books and video games,” said Martín Utreras, eMarketer’s VP of forecasting.

Kentucky: Public Protection Cabinet announces leadership changes at Alcoholic Beverage Control

Public Protection Cabinet Secretary K. Gail Russell today announced leadership changes at the Department of Alcoholic Beverage Control (ABC), the agency responsible for regulating the sale of alcoholic beverages in Kentucky.

Carol Beth Martin, who has served as malt beverage administrator since February 2016, has been appointed acting commissioner. She replaces Christy Trout-Van Tatenhove, who served as ABC commissioner since October 2016.

“Carol Beth’s experience in administration and operational functions will serve the department well,” said Secretary Russell. “I know Carol Beth will continue the great work begun by Commissioner Trout.”

“I thank Secretary Russell for the opportunity to continue to serve in this increasingly important role in Governor Bevin’s administration,” said Martin. “In addition to ensuring state law is followed, I will continue working with the alcoholic beverage industry encouraging its economic development.”

Originally from Campbell County, Martin holds a bachelor’s degree in political science from the University of Kentucky and a master’s in public administration from the University of Kentucky Martin School of Public Policy and Administration. She and her husband Scott live in Louisville with their two daughters.

Karen Sellers has been appointed deputy commissioner. Following years as an executive in the healthcare industry, Sellers will aid in the administration of the department, including managing staff, overseeing licensing, and interacting with the public.

“I am honored to be a part of the impressive team at ABC,” said Karen Sellers. “I look forward to working closely with a dedicated team of professionals as we strive to ensure our communities in the Commonwealth are safe and responsible.”

“Karen Sellers’ experience in corporate healthcare administration is extensive,” said Secretary Russell. “I am very appreciative for her willingness to step away from her career to lend her abundant talent in service to the Commonwealth and its citizens.”

Illinois: Want liquor delivered to your house? Illinois Senate committee advances legislation (Link)

A bill allowing for the home-delivery of liquor passed the Senate Executive Committee Wednesday, with its sponsor promising to bring an amended proposal back for further discussion.

State Sen. Don Harmon’s Senate Bill 54 passed unanimously. Harmon said he was still working with the liquor control commission and other groups to fine-tune the bill before it comes to a vote before the full chamber.

https://herald-review.com/news/state-and-regional/govt-and-politics/want-liquor-delivered-to-your-house-illinois-senate-committee-advances/article_e58cfec5-a927-5b22-a429-41fe956558b5.html

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