Scottish Borders grain distillery set to fill whisky supply gap

Jackson Distillers is hopeful there will be “boots on the ground” at the St Boswells site in a matter of weeks, providing fundraising closes as scheduled at the end of March.

The distillery is the idea of Borders farmer Trevor Jackson, who was inspired to develop the project after watching tonnes of cereals grown in the region picked up by lorries and transported for miles to Scotland’s grain distilleries, such as Girvan and Cameronbridge.

Mr Jackson, owner of Charlesfield Farms and Estate on which the distillery will be built, says the facility will provide a vital source of grain spirit for the whisky industry as it continues to see rising demand for its products around the world.

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Grain spirit is used by distillers in the creation of blended Scotch, which accounts for the majority of whisky exports around the world.

Jackson Distillers has secured planning permission for a facility capable of producing 20 million litres of pure alcohol per year and notes it will also be Scotland’s lowest carbon grain distillery, with new technology harnessed to allow it to ultimately become a net absorber of carbon.

Mr Jackson has already established an anaerobic digestion plant on the site, which produces energy from crops grown on the family farm.

Jackson will be the first new grain distillery to be built in Scotland for around a decade.

Outlining the rationale behind the project, chief executive Mr Jackson said: “There are 134 malt distilleries in the country at the moment, and 20-odd malt projects looking for funding. There are only seven other grain distilleries.

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“There is a premiumisation trend we identified back in 2019. Despite the pandemic everybody is still looking to consume less but better. That drive to premium malts has maybe left a space underneath that has not been looked at by the whisky trade, and has been filled to a certain extent by rum, Irish whiskey and Jack Daniel’s, etc.

“There has been a real tightening of that grain market – there really isn’t anything to be found if you are a blender to fill your allocations. Allocations seem to have been cut by the big boys for their own use.

“Overall, we looked at the trends in the market. We saw that the supply capacity was starting to be filled, and we could see that by 2025 we were looking at 98 per cent capacity (utilisation) – even with our added 20 million litres.”

Mr Jackson said his project had to be repriced in light of Russia’s invasion of Ukraine, which has sparked inflation and forced up building costs. The company is now looking to raise £53m, £7m more than initially forecast.

People of high-net-worth with distilling experience, trade players, and other financiers have been expressing interest in the project, and Jackson has also been holding talks with the Scottish National Investment Bank over the prospect of it providing finance. “The funding is starting to open up,” he said.

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And Mr Jackson is hopeful work on the distillery will be completed within 18 months to two years of getting under way in April.

“I know this might sound, horribly callous, but as we are heading into

a bit of a recession there has been quite a lot of construction projects put on hold. If we can build as we go through that recession, then that allows our timings to be a lot less pressured.

We are seeing there has been a bit of an easing already in terms of steel and some construction projects are being deferred. Hopefully that means we can hit our targets.”

The project has been boosted in recent weeks by the addition of several senior figures to its executive team, some with deep experience of the whisky industry.

David Brown, formerly of Allied Domecq, Whyte & Mackay, and John Crabbie & Co, joined as commercial director; Tommy Leigh, formerly production director of the North British Distillery in Edinburgh, was appointed operations director; and Nick Laird, who has extensive experience in manufacturing, private equity and venture capital, has come on board as deputy chief executive.

Mr Jackson, who hopes the distillery will be able to supply gin producers with spirit as well as Scotch makers, said the new team are “just a fantastic resource”.

He added: “We did the market research. I think we guessed before the industry realised that this was going to be a good point to add that extra capacity and to give a point of difference to premiumise.

“We really want to lead the industry into working with that carbon capture piece. We will be capturing about 3,000 tonnes of CO2 net when we get going. By building the distillery we will be emitting 26,000 tonnes of C02, but once we get going and we are capturing that 3,000 tonnes a year, we will be hitting net zero and absorbing carbon by about 2030 and certainly well before the 2045 [Scottish net-zero target] date.”

Q&A

When you were a child, what was your ideal job? Why did it appeal?
I wanted to be an agricultural engineer because I wanted to understand how things were put together and how they worked in a practical way. Also, Tonka toys looked great.

What was your biggest break in business?
There has been no single moment, but the journey to where I am today has been built on persistence and resilience.

What was your worst moment in business?
Being caught on the edge of the foot and mouth disease outbreak in 2001, which left me with a £500,000 hangover.

Who do you most admire and why?
My mother, who guided the family and farm through challenging times following my father’s premature death. She was also a very early adopter of renewables and energy efficiency, which inspired my commitment to environmental best practice.

What book are you reading, and what music are you listening to?
I am reading James Kerr’s Legacy, about what the All Blacks can teach us about the business of life. 
I mainly listen to podcasts, but my current music playlist includes Calvin Harris and Avici for a bit of escape.