Tuesday, July 24, 2018

United States Craft Distillery Operations Rises by 26%

     In 2016 there were 1,315 active distillers in the United States, that has risen to 1,589 in 2017, according to the data compiled by the American Craft Spirits Association (ACSA), Park Street Imports, and the IWSR.   A craft spirits producer is defined by the ACSA as a producer that has not removed from more that 750,000 proof gallons from bond.  It also markets itself as craft; is not openly controlled by a large supplier and has no proven violation of the ACSA Code of Ethics.

     The West boasts the largest number of distilleries, some 32.7 %, but the South with classic spirits states like Texas, North Carolina and Kentucky, comes a close second with 29.3%. The Midwest accounts for 19.1% and the Northeast 18.9%.  California is the state with the most distilleries: a total of 148, which makes up 9.3% of the nation's total. This is followed by New York, Washington, Texas and Colorado.  On average, more than half of a craft spirit producer's US sales come from within its home state (18% at the facility and 34% outside its premises).  "Nearly one-fifth of all sales take place at the production facility, underscoring the importance of tasting rooms and on-site retail to the bottom line,"? says ACSA in its 2017 annual report.

     Working at the Hemingway Rum Distillery in Key West is great to be a part of the growth of the past year.  Here in Key West, we have three craft distilleries, which is a lot for a two by four mile island.   The strength of the craft distillery, especially in a place where there are a large number of tourists is staggering.  The interest in how spirits are made and being to get up close and personal with the fermentation tanks and stills make the experience even more special.  The purchase of a bottle of spirits that the distiller can sign for you give the place a personal feel that you can take back home with you.

     "The legislative action has helped level the playing field for spirits within the broader craft beverage space, putting distillers on par with breweries and wineries. Prior to the law's enactment, a craft spirits producer had paid 5.4 times more FET than a craft brewer and 16.4 times more FET than a small winery, for equal quantities of beverage alcohol.?  "While it certainly is a time to celebrate, our work is only just beginning. ACSA's priority now is to ensure that Congress votes to make the tax relief permanent."?   The American Craft Spirits Association is a registered non-profit trade group representing the U.S. craft spirits industry.

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