Diageo has temporarily halted malt production at its Roseisle site near Moray, Scotland, as the industry faces increasing challenges including higher production costs, shifting consumer behaviour and a weaker global market.

When Diageo unveiled its £40 million environmentally friendly Roseisle Maltings in 2010 it was the first distillery to be built in Scotland in 30 years. It has an annual capacity of 35,000 tonnes and was created to supply spirit for Diageo’s blended Scotch brands.

Roseisle also released its first single malt whisky, a 12-year-old “The Origami Kite,” as part of Diageo’s Special Releases in 2023.

A Diageo spokesperson told The Drinks Business: “Whilst we remain confident and committed to the long-term growth of the Scotch category, after a period of sustained growth and associated investment, we are now managing capacity requirements in line with our levels of maturing inventory.”

“Production at Rosisle Maltings has been paused until at least June 2026. Future production is currently under review and we are communicating with our suppliers as part of the normal planning cycle.”

“There is no impact on staff, who have been redeployed to other sites or roles.”

Scotch Whisky Association (SWA) Chief Executive Mark Kent used his keynote speech at the Scottish Distillers Conference last month to highlighted the industry’s “moment of crisis”, dogged on the world stage by the imposition of a 10% tariff on exports in the US, and at home by soaring excise duty on spirits, which “in plain words and the real world means job losses, investment plans put on hold or cancelled completely, and in some cases the viability of whole businesses put in jeopardy.” 

UK Chancellor Rachel Reeves will deliver her Budget on 26 November, with Scotland’s distillers to add their voices to the growing calls for a spirits duty freeze.

The Scotch Whisky industry contributes over £7bn in annual GVA, with exports worth £5.9bn in 2024. The UK – whose excise duty is the highest in the G7 – is Scotch Whisky’s fifth largest market. Over 70% of the price of a bottle of blended Scotch Whisky is now paid in tax, which the SWA has repeatedly says stifles growth, business confidence, and the success of the wider supply chain. 

“The spirits industry has a reputation for modesty and resilience, of buckling down and getting to work whatever the gale that is blowing” said Kent.

“But now is the time to be vocal so that the context in which the industry is working can be understood. The Scottish spirits industry is an essential part of communities around the country – employing skilled and enthusiastic people, bringing visitor footfall, investing in growth and putting Scotland and its high-quality spirits on the map. Now is the time for a clear message for the UK government to act, before the damage being done to our industry reverberates to the wider economy.”