For the first time in over 50 years, a new American spirit category has been born.
Last Friday, the U.S. Tax and Trade Bureau (TTB) announced a final ruling defining American single malt whiskey. Most distillers are rejoicing, but at least one prominent voice is arguing the new ruling limits the flexibility of the young category.
In 2022, distillers of American single malt celebrated the TTB’s announcement that it would be creating a designation for the category. With Scotland historically dominating single malts, Americans were late to hop on the bandwagon: domestic single malt styles didn’t appear until the 1980s and 1990s, by which time regions like Scotland and Japan were already category leaders.
But the style has grown stateside, offering American craft distillers the freedom to leverage a sense of terroir differentiated from bourbon or rye, and major brands have embraced the spirit as a way to broaden their portfolios in the higher end American whiskey category. U.S. producers are eying both domestic and global opportunities, hoping to take market share from Scotch whisky. As of 2024, there are over 200 American distilleries making single malts according to the American Single Malt Whiskey Commission (ASMWC).
“This is a landmark ruling from the TTB that further cements our standing on the global stage in whiskey,” said Steve Hawley, president of ASMWC, in a statement. “We applaud TTB for hearing the call from distillers, purveyors and fans of American single malt, and formalizing a definition that supports and protects our producers both here and abroad.”
New Standard, New Platform
The new definition, which will be added to the federal registrar December 18 and take effect on January 19, 2025, has many across the industry taking a victory lap.
“As an official whiskey category – legally defined and protected by the U.S. government – American single malt has earned its place alongside bourbon, rye and other categories that today enjoy worldwide recognition,” said Lander Otegui, senior vice president of marketing for Proximo Spirits, which owns category leader Stranahan’s American Single Malt Whiskey.
The final rule includes several key requirements: American single malt must be mashed, distilled and aged in the U.S.; distilled from 100% malted barley at one distillery, with a distillation proof of 160 (80% ABV) or less; and aged in uncharred or charred new or used oak barrels, with a maximum volume capacity of 700 liters. The spirit cannot contain neutral spirits, flavorings, or other blending materials except caramel coloring, which must be disclosed on the label if used. Similar to other styles of whiskey, American single malt aged for two or more years can be labeled as “straight” whiskey.
“The TTB considered all of our petitions and suggestions, and we couldn’t be happier with the new standard of identity for single malt whiskey in the U.S.,” said Boulder Spirits founder Alastair Brogan, which has been making American single malt since 2015.
For many distillers, the hope is that a legal standard will provide a boost as they aim to compete with more dominant whiskey categories at home and on a global scale (although tariff threats may throw a wrench in those plans). American whiskey was one of the bright spots for spirit sales in 2023 and represented the fourth fastest-growing segment, up +3.8% into $5.3 billion (+$192 million).
“An official category designation gives the American single malt category an added element of legitimacy,” said Mark McLaughlin, co-founder of Baltimore-based Old Line Spirits. “If we want to be taken seriously along with single malt producers from Scotland, Ireland, Japan, etc. we need to have a well-defined and official place in the American marketplace.”
Education has been a major pain point for ASM distillers, who are banking on the designation to generate media buzz and help familiarize consumers with the style.
“There is still a misconception among many people about what it means to be an American single malt and what flavor profiles to expect,” McLaughlin said. “We are confident that as more and more people try them, they will begin to really appreciate the depth and breadth of what these whiskeys can offer.”
McLaughlin sees the most opportunity on-premise, adding that the company finds “a lot of bartenders who love what it is the bottle but comment that consumers aren’t asking for American single malt very much.”
Stifling or Stewarding Innovation?
Many distillers are hailing the definition for “protecting” the spirit while leaving room for innovation. But some see the new rules “as a cage.”
“The proposed American Single Malt definition allows American single malt producers more latitude on certain elements of production than do our peers in Scotland and our peers making bourbon here in America,” McLaughlin said.
That leniency extends to methods such as using pot stills or column stills, or maturing in virgin oak barrels or used barrels for any amount of time that producers feel is appropriate.
But at least one distiller is arguing that the new standard, specifically the ABV limit, is stifling innovation. The 80% ABV maximum is in line with regulations for Bourbon, which is made from a mixture of corn and grains. Phil Steger, founder and CEO of Minneapolis-based Brother Justus, argues the proof limit makes the style less competitive and ignores the nuances of distilling with American single malt’s prime ingredient, barley.
“The new rule eliminates distillation flexibility for American Single Malt distillers, forcing them to distill all-barley whiskey the same way bourbon is distilled, at 160 proof or less, instead of with the freedom single malt distillers in other countries enjoy,” said Steger via LinkedIn.
The distiller has been producing American single malts made with regional ingredients for ten years.
“A legal definition is a good thing,” Steger wrote. “The wrong definition that stifles innovation and limits the freedom to craft better flavors is worse than no definition at all.”
Steger, who opposed the 160-proof rule in the comment period, said he will explore legal options to counter the new ruling.