Market Watch, January 2020

34 MARKET WATCH MARKETWATCHMAG COM JANUARY FEBRUARY 2020PHOTO BY TOP KAYLA RAINBOLT shift in demographics and an interest in craft he says This will eventually energize the overall American brandy category The Craft SceneCopper Kings is one craft producer that has gained wide spread recognition since launching in 2014 Our American brandy isnt staid and traditional Heron says Its modern and well designed and has a personality The distillery which selects its grapes from California and its apples from Michigan prides itself on partnering with companies like Kentucky Peer less Distillery and Chicagos F E W Spirits for novel barrel finishes Copper Kings most recent releases are its North ern Soul Michigan Apple brandy aged in hard cider casks from Michigan cidery Vander Mill and its Way Up West American brandy aged in Kentucky Bourbon barrels followed by Amer ican single malt whiskey barrels both 65 a 750 ml The portfolio also includes American Apple brandy 35 Amer ican Craft brandy 35 American Butchertown brandy 60 and Floodwall Apple brandy 45 and Heron notes that pear and peach brandies are in development In recent years E J Gallo has made some interesting moves in the American craft brandy segment through its Argo naut and Germain Robin labels Argonauts offerings include Speculator 38 a 750 ml Saloon Strength 38 on premise only Fat Thumb 50 and limited release The Claim 200 and Germain Robins portfolio comprises the namesake flag ship 75 and the XO 125 Argonaut distributes in Cali fornia with future expansion in the Northeast anticipated while Germain Robin distributes in 17 states and Washington D C Both Argonaut and Germain Robin remain at small volumes of under 5000 cases but Gallos involvement at the upscale end of the category is an investment in future growth Customers have already proven their willingness to trade up with brandy as with high end Califor nia craft label Charbay whose bottles can fetch hundreds of dollars Weve seen an uptick in people talking about our brandy says Charbay co owner and director of operations Jenni Karakase vic Among its offerings Charbay produces a 1989 brandy 240 and a 1983 brandy 475 At Finger Lakes Distilling in upstate New York the focus is on brandies made from fruit grown in the region with offer ings including Grape brandy 43 a 750 ml Apple brandy 28 a 375 ml Pear brandy 33 and a Maplejack liqueur 23 made with apple brandy Brian McKenzie president of the distillery experiments by making grape brandies with native varietals that dont necessarily have a major role in winemaking We try to experiment and when we blend were bringing components from the different varietals into something thats well balanced McKenzie says He adds that his Collins Colorado managing partner Mat Dinsmore says much of the catego rys success is still price led The suggested retail price for E Js flagship VS is 12 a 750 ml while Christian Brothers VS is 13 Korbel California Brandy is 13 and Paul Masson VS is 23 E J is the best known name in American brandy accounting for an estimated 47 of the categorys share of the U S market in 2019 The core E J lineup features VS 12 VSOP Grand Blue 13 a 750 ml and XO 15 and its flavor range which includes Peach Apple and Vanilla entrants all 12 a 750 ml has been driving growth recently Christian Brothers also taps into flavors with a lineup that includes Apple Honey and Peach expressions all 11 Paul Ahvenainen director of winemaking and master distiller for Korbel whose depletions were down 3 to 260000 cases last year according to Impact Databank agrees that the cate gory is being revitalized by the interest in craft offerings even if major growth is still a long range prospect Were seeing a E J Gallos Argonaut brandy line features three offerings above while Starlight Distillery co owner and master distiller Ted Huber and son Christian distiller top offers six brandies