Scottish whisky distillery toasts China deal

A major independent Scottish distillery is tapping into the lucrative Chinese thirst for whisky after securing a distribution deal with one of China's food and beverage giants.

Castle Li from COFCO (right) and Bill White from Loch Lomond check a barrel of whisky at the distillery.  [China Daily]

Loch Lomond Group, which is based in Alexandria in Scotland, has entered into a partnership with China National Cereals, Oils and Foodstuffs Corporation, which is also known as COFCO.

The Scottish group's full range of whiskies, which include Loch Lomond, Glen Scotia, and Littlemill, will be available to customers throughout China.

The deal will make China one of Loch Lomond Group's key export markets. COFCO has an extensive network of 700 off-licenses and more than 1,000 sub-distributors.

Demand for high-quality whisky has soared on the Chinese mainland, driven in part by rising middle-class incomes.

According to the Scotch Whisky Association, the value of exports to China increased 0.5 percent to 41 million pounds ($52 million) in 2016, with the market continuing on an upward trend. That followed a drop in sales after Beijing's anti-corruption measures curtailed lavish spending among public servants.

Single malt exports to the world's second-largest economy amounted to 12.9 million pounds last year, a 66 percent jump from 2015.

The Alexandria-based group noted whisky sales increased 12-fold in China during the last 10 years.

Colin Matthews, chief executive of the Loch Lomond Group, said: "We're very excited about our new partnership with COFCO across the fast-growing Chinese market. COFCO is a very ambitious, energetic and innovative organization with a great team and exciting plans for the future, which matches our own aspirations, both for China and as a group."

After visiting Loch Lomond Group's Alexandria malt and grain distilleries, as well as its Glen Scotia distillery in Campbeltown, Castle Li, general manager of COFCO Wine & Spirits, said: "COFCO is determined to use all of our resources, energy and routes to market strengths to succeed in bringing the Loch Lomond and Glen Scotia Scotch whisky portfolios to the Chinese market and its many millions of consumers."

Li said the partnership will be a key part of COFCO's drive to become the No 1 imported spirits distributor in China.

"We believe that the Loch Lomond Group's brands will have major appeal to a wide spectrum of consumers in China where we are seeing significant growth in demand for premium drinks brands, especially Scotch whisky."