Whisky barrels can be a great investment when done correctly. The best way to protect yourself and make a sound whisky barrel investment is through knowledge. From ensuring you are buying at the right price to understanding how ownership is transferred and avoiding scams, this article is designed as a starting point to help you know whether barrel investment is right for you.
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Whisky Barrels Are A Long-Term Investment
We suggest looking at whisky barrels as a minimum 10 to 15 year investment. If you are looking for a short-term option then barrels probably aren’t the right investment for you. There are a few reasons for the longer timescale.
Firstly, if you are buying newly filled barrels of scotch, then the spirit needs at least three years to mature before it can legally be considered scotch whisky. While three is the minimum the longer a whisky matures within a barrel the better it is considered to be—and the more valuable it becomes. (To a point—whisky barrels don’t mature indefinitely).
Secondly, 90% of whisky casks are used for blending and are bottled before they reach 12-years-old. It is after this point that the whisky becomes more scarce and therefore more valuable. Twelve-years-old is the absolutely minimum we would suggest selling a cask at. Ideally you should aim for around 18 because it is around this age that whisky becomes classed as a premium product, and there is a corresponding increase in value around this point too.
Lastly, giving yourself a long term time frame and waiting at least 10 years before selling your barrel gives the distillery that you bought from time to invest in their brand, and reposition themselves in the market. While age driven increase in the primary driver of value, brand repositioning can drive additional increases above the average. But this takes time.
Whisky Barrels Are A Finite Investment
It is also important to remember that whisky barrels are a finite investment; every cask is bottled at some point because whisky is a drink and if it’s left too long it becomes worthless. You do not have to be the one to bottle the cask—you can sell the cask in bond to be bottled by somebody else—but eventually it will be bottled.
As a barrel matures some the whisky evaporates (known as the angel’s share) at an average rate of 1% to 4% per year. The ABV (alcohol by volume) also drops by around 0.5% per year. The Scotch Whisky Association states that a spirit must be over 40% ABV to be classed as Scotch. So if a cask is left to mature for too long then eventually either the the contents evaporates to the point that the cask becomes essentially worthless, or the ABV of the whisky will drop below 40%, at which point the spirit inside the cask is no longer legally scotch whisky and the value plummets.
Do note that the rates of evaporation and ABV change above are averages. The actual changes experienced by barrels can be higher and lower than this. Monitoring the changes of your barrel is a important part of barrel investment for private individuals. Fill levels can be monitored via a regauge and we suggest performing this check every 3 to 5 years.
What Is A Regauge?
A regauge is the process for checking the fill levels and alcoholic strength of a barrel of whisky. Regauges are performed by the warehouse where your cask is stored, but you will usually have to request these yourself. There are two types of regauge: discharge and dip. Dip regauges are the most common way of monitoring a cask, a full discharge regauge would usually only be performed when the cask is ready for bottling.
A regauge will tell you two things:
- The bulk litres—the total litres of liquid/whisky in the barrel.
- The alcoholic strength of your spirit/whisky—ABV or alcohol by volume.
From these two figures you can then work out the “regauged litres of alcohol”, or RLA. For example, if you have 200 bulk litres in your barrel at 50% ABV, then there are 100 litres of alcohol in that barrel. If you have 100 bulk litres at 45% then you have 45 litres of alcohol, and so on.
As well as keeping an eye on the overall health of your barrel a regauge is a key way to check the value of your cask and help you decide when to sell. Casks are valued on a price per RLA, so you can use this figure to get an accurate valuation for your barrel. The strength is also an important metric because of the 40% limit on scotch whisky. For example, if the ABV of your cask is at 42% then this is close enough to 40% that you should be looking to sell. However if it is at 52% or 62% then you can evaluate the market and price per RLA of your barrel cask to decide whether to sell or hold onto it for a few more years.
Can Barrel Investment Go Wrong?
Buying a barrel of scotch whisky can be a lucrative alternative investment. But like all investments there are risks and inherent vices—like the evaporation rates we discussed. Risks can be reduced and managed by proper management of your asset, and understanding of ownership and potential costs. Below we also discuss some of the other common issues people face when buying barrels of scotch.
The Importance of Delivery Orders
A delivery order is the industry standard way of transferring the ownership of scotch whisky barrels. Warehouses don’t need to use a delivery order (although most do), but if you are being offered something else then the best course of action is to check with the warehouse itself. This is the advice of the Scotch Whisky Association.
A delivery order acknowledged by the warehouse ensures that you own the barrel at the warehouse level and have full control over your asset. A certificate, title or other document issued by the company you’re purchasing from and not acknowledged by the warehouse, means that you are likely not the registered owner at the warehouse level. This can cause issues for you further down the line:
- When you come to sell your cask you are likely tied to the company your purchased through.
- If that company ceases to operate between the purchase and sale point then this can cause issues in terms of proving ownership (and even finding your cask if you don’t have the warehouse details).
- In the very worst case scenario this ownership structure enables fraud. The barrel investment industry is unregulated but a delivery order confirmed by a WOWGR registered warehousekeeper acts as a measure of regulation. If you do not have that contact with the warehouse then your are relying completely on the company you bought the barrel from to accurately represent the fill details, whisky type, distillery etc.
Many companies have maintained that you need a WOWGR to own casks at a warehouse level. While this has never been true WOWGR legislation is being updated in March 2025 and the updates remove all doubt about this.
Paying Too Much For Your Barrel
The other common way for barrel investment to go wrong is where customers have overpaid. Overpaying is much more common for older casks. Unfortunately there is no open market way to check the value of a barrel of whisky. This is partly because most sales of scotch barrels are within the industry, and it is not useful for the industry for the public to know the wholesale value of the spirit in the bottles on the shelves. To a degree it is also due to the natural variation in fill levels between barrels making them difficult to compare. This is why casks are valued on a price per RLA basis (see the regauge section above if you missed what RLA is).
Barrel investment is an unregulated industry. The UK’s Advertising Standards Agency (ASA) limit the misleading figures that cask investment companies advertise, but there is no Financial Conduct Authority or similar for barrel investment. This means that you need to do a lot of due diligence when deciding on a company to work with.
To help provide a (very basic) way to check the current price you are being offered for a barrel of scotch we developed our Cask Calculator. You can use the fill details of a barrel to create a per bottle cost that you can compare against wholesale bottle values as a starting point for checking the value of a cask you are being offered.
Familiarising yourself with the industry is an important part of making a sound barrel investment. You can also look at examples of past whisky barrel scams to help you learn what to look out for when you are starting your journey.
Managing Your Expectations About Barrel Investment
Expectations are one of the biggest ways that a barrel investment can feel like it is going wrong. There are limits to what barrel investment companies can advertise now but unrealistic expectation of the rate of return and the speed of those returns are still a big issue for purchasers. It is important to realise that 10 to 18% per annum returns are unrealistic and that casks are a long term investment.
Firstly, you don’t get annual returns from casks; the capital is tied up until you come to sell your cask. Ideally this means at least 10 years.
Secondly, if 10 to 18% per annum returns on whisky casks were possible then every business-owner, investment fund manager, and pension fund manager in the world would be investing their money in casks. After all, if you could take out a 5% business loan and then invest that money in casks, make an 18% per annum return, and then pay back the business loan, wouldn’t you? Of course you would. However, as mentioned earlier, you will not see a return on your barrel until you come to sell.
Barrel investment can be rewarding over a long period of time. When you average out the increase in value between a 3-year-old cask and a 20-year-old cask you may well see a 10-18% increase in some casks. However, this is not an annual return from your barrel, and the eventual return that you see can vary massively depending on the health of the cask and the position of the brand in the market.
Barrel Investment With Mark Littler Ltd:
- You contact Mark Littler Ltd about buying a barrel of whisky and we have a conversation with you regarding your expectations for your investment and what kind of barrel you are looking to buy.
- You set a budget and we send you a selection of casks and detailed information on each option.
- You book in for a call to discuss your options and run through any questions with one of whisky investment experts.
- You choose the best cask for you and then we draw up a contract for you to review and sign online.
- You then pay for your cask.
- We send your details to the warehouse who opens an account and sends your delivery order, which you print, sign and return.
- We send your welcome pack with your contract, invoice and a decorative certificate.
- Your cask is moved to the warehouse that we work with in Scotland.
- You can make an appointment to visit your cask at the bonded warehouse and have the opportunity to draw samples from your cask.
- You can contact us at any point during your ownership for assistance arranging a regauge, samples, visits and valuations.
- In 10 or more years you approach Mark Littler Ltd about selling your cask. We find you a buyer that will offer you a fair price for your cask. The process is quick and easy as you have a delivery order to prove your ownership.
Ready To Buy A Barrel?
Here at Mark Littler Ltd we are committed to helping our clients buy a barrel at the right time and for the best price. We source casks from wholesalers for our clients and have conversations with our clients about their expectations of ownership so that we can ensure that you own a barrel of scotch that is suited to you.
If you would like to read more about what buying and owning a barrel of scotch whisky then please sign up to receive a pdf of our Cask Buying Guide. The guide goes into even more detail about the services that we offer, how the industry works, and how barrel investment works.
If you are ready to choose your barrel and begin your journey or have any questions please get in touch via email at [email protected].
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