New Zealand small-batch distiller Scapegrace is to build a new US$16m facility in Central Otago.

The spirits producer claims the 36-hectare facility will be the biggest distillery in New Zealand upon completion in October 2023. The site will produce the company’s entire portfolio of super-premium gin and vodka, as well as a line of single malt whiskies in the future.

The distillery will be based on the banks of Lake Dunstan, and use water from New Zealand’s Southern Alps, according to managing director Daniel McLaughlin.

“The halfway point between Equator and South Pole runs directly through our distillery site, giving us extremes in hot and cold temperatures – an optimum environment for aging whisky,’ he said. “Naturally, the pristine water quality is also ideal for distilling gin and vodka, pulling from glacial run-off from the Southern Alps.”

The distillery, which was founded in 2014 and exports its spirits to more than 40 countries worldwide including the UK, the US and Canada, produces its drinks at a contract facility.

Ground has already been broken on construction of the first distillery building, which will contain the new Scapegrace head office, bottling hall, warehouse and the first of three barrel rooms when it opens in August of this year.

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By GlobalData

The second building will contain the distillery itself, as well as a bar and restaurant, and is penned in for an October 2023 opening.

The combined spirits category in New Zealand is growing steadily and is predicted to be worth US$4.2bn this year, according to GlobalData. By 2026, the category will be worth US$5.7bn, giving it a five-year compound annual growth rate of 6.4%, GlobalData forecasts.

Whiskey is set to be the biggest spirits category within the segment, with sales of US$2.64bn predicted in 2026, the data and analytics group says. The fastest-growing category in the next five years, however, is predicted to be 'Flavoured Alcoholic Beverages', which is forecast have a five-year CAGR of 8.09% between 2022 and 2026.

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