Less whisky

Of course, beer wasn't the only drink made from malt. In Scotland, considerable quantities were used in the making of whisky.

Like brewers, distillers were allocated a ration of raw materials, based on their pre-wart production. Though they were never allocated enough to reach anything like the pre-war level of production. By 1942, distillers were only allowed to produce a tiny percentage of their peacetime output.

"MALT WHISKY LICENCES FOR DISTILLERS
Further Cut in Production
A further cut of 10 per cent. in the production of malt whisky will be made during 1942. Licences for malt distillers to purchase enough Scottish barley to produce their quotas — one third, less a tenth, of their output in the year ended September 30, 1939 — will be issued shortly. No grant of licences for production of grain whisky will be made at present.

A cut of about 15 per cent. in whisky supplies last August following a reduction of 35 per cent. in March brought the total reduction up to 50 per cent. of pre-war figures.

Last week ihe Brewers' Society announced that the specific gravity of beer was to be reduced by 5 per cent. from January 1.

Difficulty in Finding Staffs
The information that there will be licences to purchase barley for the making of whisky this season, even on a restricted scale, is welcomed in the North of Scotland, which is the chief producing area.

"Hope of a restart had almost been given up," stated a Speyside distiller last night. "Although we are to be allowed only to make 10 per cent. less than last season's quota, which was one-third of the output for the year ended September 30, 1939, it is welcome as — on account of heavy exports — a shortage would soon have been apparent."

The chief difficulty will be in finding staffs, but that will be overcome by reengaging men who have been on the retired list."
The Scotsman - Wednesday 07 January 1942, page 3.

I'm not quite sure why no grain whisky was allowed to be produced. It seems counterintuitive to me.

Because of the time lag between distilling and selling of whisky - a minimum of three years - the effect of cuts in production would only just have been starting to bite in 1942. And the shortage must have last well into peacetime. Whereas with beer the effects were much more immediate.

Average OG fell from 1038.51 in 1941 to 1035.53 in 1942. Which is closer to 8% than 5%.

Difficulties of Pattisons

When the crash came, it was very quick. And the fall had wider consequences than the fate of one particular firm, as we will learn later.

On the 3rd December, Pattison's were still merrily advertising their beer in the Edinburgh Evening News. Two days later, rumours began to circulate about the financial position of the company and the share price nosedived:

"THE AFFAIRS OF PATTISONS, LTD.
Rumour was busy in Leith this forenoon in connection with the affairs of Mesrs Pattison, Ltd., distillers, whisky blenders, and brewers, Leith and Duddingston. The Stock Exchange was affected, and the price of the cumulative preference stock, which stood in the morning at £9 18s 9d, fell to £4 4s, the fall being equal to over 55 per cent. Later in the day the price was £4 sellers.

On inquiry at the offices of Messrs Pattisons, Ltd., to-day, our reporter, in reply to the question as to the reason why there was so sudden a fall in the firm's stock on the Stock Exchange, was informed that that would probably be explained later. He was also told that the firm's financial affairs at the present moment were in the balance.

In Leith this afternoon there were rumours that other two firms were also in an unstable condition financially. The company was registered as Pattisons, Limited, in 1896, to acquire the business of Messrs Pattison, Elder, & Company, whisky blenders, &c., and Pattisons' Brewery. The authorised capital was £40,000, half being ordinary shares of £10 each, and half 5 per cent, cumulative preference shares, the latter having a priority as to capital."
Edinburgh Evening News - Monday 05 December 1898, page 3.

One note: the share capital amount is incorrect in that report. It was £400,000 not £40,000.

I wouldn't have been reassured by that vague promise that all would be explained at some point in the future. Investors weren't either. The shares fell further the next day as the rumours persisted:

"PATTISON'S WHISKEY.
GREAT FALL IN THE PRICE OF SHARES.
Our Edinburgh Correspondent, telegraphing last, night, sais that the rapid fall in the shares of Pattison's (Limited) on the Edinburgh Stock Exchange yesterday was indicative of distrust. The price of the £10 Preference shares, which on Saturday were sold at little under par, fell to £3 in the course of the day.

Another Correspondent says that many rumours were current yesterday in Leith and Edinburgh, regarding the position of Pattison's (Limited) distillers, whiskey blenders, and brewers, Leith, and elsewhere. The price of Pattison s Cumulative Preference Stock opened in the Stock exchange in the morning at 9 15-16 land fell to 4.25, and later to 4 sellers. On inquiry being made at Messrs. Pattison's offices, it was stated that the cause of the sudden fall in the price of the stock would probably be explained afterwards.

Pattison's (Limited) is one of the greatest businesses in the trade, and its vast business extends throughout the Colonies. They have immense warehouses in London, their bonds and offices are then finest in Leith, and they three years ago erected a large brewery at Duddingston. The profits for last year were returned at £52,000. When the company was converted the Preference stock was over subscribed for about ten times. These shares are £10 each, and they have been standing at a premium until yesterday.

The company was formed to acquire, as from the 1st January, 1896, the businesses of Pattison, Elder, and Co., wine and spirit merchants, of Leith and London, and of Pattison's Brewery, Edinburgh. The purchase money. £400,000, was payable £200,000 in ordinary shares, £50,000 in fully-paid preference shares, and the balance in cash. The remaining preference shares were offered at par in March. 1896. The preference shares were entitled to an accumulative dividend of 5 per cent. and to priority for capital without further participation. The articles provide that out of the profits for each year, after paying the preference dividend, not less than £5,000 shall be set aside to form a special reserve fund of £50,000, such fund to be applicable for payment of preference dividends should the profits in any year be insufficient to do so. The first accounts, made up to the 31st of March, 1897, were submitted in June. There was a general reserve fund of £10,000 and a special reserve fund of £5,000. The dividend for 1896-1897 was 10 per cent. per annum.
London Daily News - Tuesday 06 December 1898, page 7.

I'm only just beginning to realise how big Pattison's whisky business was. It turns out to have been one of the largest in Leith, the centre of the wholesale whisky trade.

The news didn't get any better and Pattison's share price continued to fall:

"EXCITEMENT IN THE LIQUOR TRADE.
DIFFICULTIES OF PATTISONS (LTD.)
Great excitement (says the "Edinburgh Evening Dispatch ") was occasioned in Edinburgh and Leith yesterday by rumours regarding financial difficulties of the firm of Pattisons (Limited). The liabilities are stated to be between one million and a million and a half sterling. The cause is said to be largely due to the manner in which the business had been pushed since the conversion of the concern into a limited liability company, and to "undercutting" and the consequent selling in many cases without a due margin of profit, The business is one of great magnitude, and it is understood that no cessation will take place, the banks, it is believed, having come to an arrangement by which affairs will be conducted as usual.

AT THE STOCK EXCHANGE.
The price of the £10 Preference share, which up till last week stood about par, and which so recently as Saturday last were sold at £9 18s 9d, fell on the Edinburgh Stock Exchange yesterday forenoon to £5 sellers and £4 buyers. The opening price on the Stock Exchange in the afternoon was £3, from which figure the price fell gradually to £2 15s, £2 10s, and at the close of the official market to £2, At each of these figures considerable business was done, and shareholders were very eager to sell.

THE BUSINESS.
Few liquor-dealing businesses in Edinburgh district, or, indeed, in Scotland, have developed with greater rapidity than Pattisons. Originally engaged chiefly in whisky-blending, in Leith, they have extended their business in various directions until their premises in Leith - some of them the finest in the kingdom, and quite new - cover a great area of ground, while they have immense warehouses in London and elsewhere.
Aberdeen Journal - Tuesday 06 December 1898, page 6.

That wild-arsed guess of their liabilities as being between one and one and a half million quid couldn't have eased the panic much. But for the first time there's an attempt at explaining the financial position of Pattison's: selling whisky too cheaply. Despite that - and the supposed enormous liabilities - the report is still optimistically upbeat about the long-term prospects of the firm. That optimism wouldn't last for long.

The fall in the share price was spectacular. From nearly £10 to £2 in just two days.

I now understand why the share capital of £400,000 seemed so out of proportion with the size of the brewery. The brewery was but a small part of the whole concern. A fairly minor and unimportant part.

From the number of newspaper reports, I'm also realising just how big a deal Pattison's failure was. Not just in Scottish nespapers, but one from all over Britain. Brilliant for me, as I'm swimming in material. Material to which we'll be returning until I've told the whole story.

Malt-drink in Ireland

Ireland again. But from another source. One of my favourite books, if only for its wonderfully impratical title: "A philosophical and statistical history of the inventions and customs of Ancient and Modern Nations in the Manufacture and Use of Intoxicating Liquors". Try saying that after a few intoxicating liquors.

"Malt-drink in Ireland, as has been already stated, was of early origin, but its general use was inconsiderable till after the English invasion. A duty of 5s. 3.75d. a barrel was imposed on it in 1787, when its consumption became of some magnitude. While it was in operation, this duty varied in proportion to the exigencies of the state and the views of the ministry ; but the government, from a wish to encourage the use of malt liquors, and the advancement of agriculture, thought it expedient to repeal the duty altogether; at the same time the duty was raised on malt from 9.25d. to 1s. 3d. the bushel, and afterwards gradually increased to 4s. 5d., and was again lowered to 2s. 7d., the present standard duty. It appears from the Parliamentary returns, that since 1796, the year in which the Irish beer-duty was rescinded, there has been on the whole, a falling off in the consumption of malt, notwithstanding the immense increase in the population, clearly shewing that the abolition of the beer-duty did not answer the intention, and proving that the Irish people preferred spirits.

To what this taste may be attributed might be worthy of inquiry ; for it must be admitted, that an Irishman has nothing inherent in his composition to render him more devoted to ardent spirits than the native of any other country. The most plausible reason for this predilection seems to be, that the malt-drink made in Ireland was never of strength, flavour, nor purity, equal to that manufactured in England: hence to the warm and exhilarating spirit a preference was given, rather than to the thin, cold, and unpalatable beer or ale to be met in the shops and taverns of the kingdom. In England, the greatest care was observed by the brewers; in Ireland the trade was in the hands of persons, the majority of whom were men of no capital, subject to no check nor regulation, and studying every thing but the interest of the public, while malt and hops formed but a small portion of the drink imposed on the community. On the other hand, it may be argued that the high duty on these articles induced the brewer to limit their use as much as possible, and to this the inattention of the legislature, in no small degree, contributed. Had the duty on malt been lowered, and a lighter duty been laid on beer with a higher impost on whiskey, it might have had the effect of making Ireland more an ale and beer than a whiskey country, and have prevented many of those misfortunes that have arisen from the unrestrained and prevalent use of ardent spirits, to the disgrace of the national character. It can scarcely be questioned, that were the trade conducted under the control of wholesome laws and the regulations of government, it could not fail to have a salutary effect by producing a pleasant, wholesome beverage, encouraging the fair trader, and punishing the deleterious manufacturer. The quality of the Irish malt-drink has, of late, through the conduct of some spirited individuals, been greatly improved, and is getting into greater repute not only at home but in the sister kingdoms, and even in foreign countries. The quantity of malt used in the breweries in the year ending the 5th July, 1827, was 1,391,456 ; and in the year ending 5th July, 1828, 1,415,832

* Parliamentary Paper, No. 30. Sept. 1828.

bushels, yielding for the one, at the rate of two bushels of malt for every barrel brewed, 695,728, and for the other 707,916 barrels of the different sorts of malt liquor.* The following is the number of bushels used by the licensed brewers for the years specified:—'

YEARS.		BUSHELS.		BUSHELS.
1832	Dublin	491,227	Ireland	1,543,265
1833	do	539,226	do	1,683,285
1834	do	790,713	do	2,055,326
1835	do	577,021	do	1,829,589
1836	do	617,035	do	2,032,856

The malt drink exported was, for the year ending 5th January,

1826	9,855	}
1827	10,800	}
1828	11,261	} Imperial barrels*
1829	14,499	}
1830	15,207	}

Of these, there were sent to England 11,101, and to Scotland 220 barrels, while in 1829 there were sent to the former 11,754, and to the latter 118 barrels.** The imports of beer during those two years were 747 barrels from England, and 875 from Scotland. In 1832, there were in Ireland 216 breweries, and in 1837, there were 247 breweries, in which the malt consumed in that year, was 2,034,557 bushels."
"A philosophical and statistical history of the inventions and customs of Ancient and Modern Nations in the Manufacture and Use of Intoxicating Liquors" by Samuel Morewood, 1838, pages 622 - 6

Apart from those lovely numbers, there was something else that attracted me to this text: the explanation of why the Irish drank proportionally less beer and more spirits. A pretty obvious one, really. Whiskey was better value and the beer was crap.

I love the way Samuel Morewood puts it: "an Irishman has nothing inherent in his composition to render him more devoted to ardent spirits than the native of any other country".

As Morewood points out, the quality of Irish beer was improving. Remember it was  in the 1840's that Guinness started exporting serious amounts of beer to England and Scotland. Over 40,000 barrels in 1840, or getting on for triple the amount of all Irish beer exports in 1830.

Before the 1800 Act of Union, beer taxation was controlled by the Irish parliament. And it often took a different path to its English counterpart. Excise duty on beer is a good example. It was always lower in Ireland than in England and was abolished in 1786 - 44 years before it was in England. Ironically, unlike most of the rest of the Irish economy, brewing wasn't damaged by the union, with the number of breweries and the amount of beer produced both increasing.

Sherry casks

Whisky. That's basically the same as beer, isn't it? Close enough for me.

Sherry casks. They weren't always what they seemed.

"For all new whisky casks these American staves are used, and let me add that, strange though yet true, because of the demand for, shall I say, a "palateable" whisky, flavoured with sherry, the cooper trade of Scotland lost in wages, year in, year out, an amount almost impossible to state. One thing I make bold to say is, that if all the sherry casks, butts, hogsheads, quarters, and octaves imported, were manufactured in Scotland, the cooper trade would have been one of the most flourishing industries in our country, not only in the past but even to-day. However, by the world's "fancy" for whisky bonded in sherry wood, we create, all unwittingly, a demand for foreign labour, and that, too, at prices far and away in excess of what is paid in this country. If ever "tricks in trade" had an opportunity of profiting thereby, sherry casks opened the door to such "tricks" being adopted, by manufacturing sherry casks. I should like to emphasise the name Slierry Casks supposed to have had sherry wine in them for years, but as "casks" had only been manufactured a few weeks before they were delivered to the distillery for filling with whisky, and having the appearance as if they had been filled with wine for years, lying in some old "Bodega" they never saw, and yet these manufactured or, shall I say, "doctored" sherry casks fetched, and, for all I know, now still fetch, prices double almost, and in cases more than double, the price of new whisky casks.

Let me give one instance, and with all due deference to any distiller who may be present, I think that he will admit my point. I have known of hogsheads (54—55 gallons), sherry shaped, being made and sold at 15s. to 16s. These were shipped to the Continent; they bore no mark, either of maker or manufacturer, yet a father should surely know his child, as it were. I have seen these hogsheads, made by myself, within a few weeks' time in varied distilleries, having been imported from the Continent as fresh sherry casks. Inside, you found a nice crust, as if they had been for years in some old vaults, but, alas, were purely so manufactured, manufactured to sell at 36s. to 40s., with but small cost to the seller, and little advantage, if in many cases any, at all to the bonder. Do we not in many instances thus play into the hands of the foreigner, without knowing the disastrous results that follow to workmen in our own country."
"Journal of the Institute of Brewing, Volume 12", 1906, pages 690-691.

What a scandal. Johnny Foreigner buying cheap casks and making them look as if they'd been used to store sherry. The cheating bastards.

What would you do?

I'm often confronted by this type of dilemma. I'd be interested to learn if you'd handle it any differently to me.

This is the situation. You've got an hour-long train ride. And you've got a bit of a thirst. Fresh out of work and gagging for a drink. What do you get for the train?

- four half-litre cans of 12% tramp juice
- a small bottle of Famous Grouse

Remember, the journey will last at least an hour.

What would you do?



This isn't a hypothetical question. I found myself in this position just last week.