Güisqui Galore: How Latin American distillers are taking on Scotch

Now some of them are beginning to think they can make a drink that tastes like Scotland too.

And so the land that already makes Merlots and Cabernet Sauvignons to rival France's has started to distil its own whiskies, with its own peat, malt and mountain lake fresh water.

Not without reason: sales of Scotch are booming across Latin America and locals fancy a share of the new bounty.

The Spanish- and Portuguese-speaking nations of the western hemisphere account for nearly a fifth of all Scottish exports, including of brands such as Old Parr and Buchanan's that rarely make it on to home shelves. Latinos buy more than half a billion pounds of Scotch a year.

Official figures show sales up 40% last year in Panama and 36% in Columbia as middle-class Latinos treat themselves. Mexico in 2018 soared past Taiwan to become the second biggest buyer of premium whiskies.

READ MORE: Spanish whisky throws off 'inferiority complex'

Chile is not up there with the big Scotch drinkers. Imports rose a quarter last year, to £32 million, a lot, but nothing compared with a £1 billion in the United States.

Yet gradually it has dawned on some in the country that they might have an opportunity.

"Chile is an extremely favourable position to become a major player on the whisky market," wrote economist Pablo Ortúzar last year. "Why? Because our sparsely populated south has ideal conditions to produce high-quality whisky: clean air, fresh water and barley.

"To that we can add all the little geographical variations that leave their mark on the precious liquor."

Mr Ortúzar is a specialist at IES Chile, a think tank in Santiago, the country's capital, and was writing in the business magazine Revista Capital.

But he was not just mouthing off. He has visited Scotland and he detailed a plan for how his country could develop a whisky industry, not least by educating master distillers in Scotland.

Entrepreneurs are not waiting for a plan. A first Chilean premium single malt, Millakoru, aged for four years in oak, recently came on to the market. It is made in the Bio Bio region with malt from mountainous Araucanía and peat from the Magellanic moorlands that cover much of the Patagonian tip of America's Southern Cone. Its name? It means "the juice of gold" in the local native American language.

READ MORE: Scotch whisky exports hit fresh record as US becomes £1bn market

Millakoru is the brainchild of a Santiago businessman called Eric Caballero. He laid down his first whisky in the small town of Talcamávida on the Bio Bio river in 2012.

Speaking to Chile's El Mercurio, he explained his logic: "Whisky is made beyond Scotland and Ireland but what distillers do is import malt and peat. In contrast, in Chile we can make artisanal whisky using local ingredients."

Mr Caballero added: "I have no interest in copying Scotch, I want to make a drink which has a local identity."

Just across the Andes, in Argentina, there is a decades-long history of bottling blended whisky, often with a Scottish if not Scotch style. Local whiskies have more than three-quarters of the Argentinian market with Scotchy-sounding brands like Old Smugglers, Blenders and River Queen. Real Scotch makes up most of the rest of sales.

But distillers in Argentinian Patagonia are also moving to an upmarket premium. The country's first single malt, La Alazana, hit the shelves just four years ago. Its distiller boasts that it is made of Andean water "that God gave you".

Elsewhere in South America there remains strong demand for substitutes for blended Scotch, such as Uruguay's established brands Mac Pay or Dunbar or the new El Xpecial in troubled Venezuela.

There are also efforts to compete with more American style whiskeys. In Bolivia, a new corn moonshine called Killa has come on the market - styled as the "first Andean whisky" - while Mexico's first home-grown "whiskey", Cetxim, is also made from corn.

It is not just Latinos who are eyeing a share South America's whisky market. So are Spaniards. Whisky DYC - which has held its own against Scottish competition on its home market - this week announced a huge Latin expansion. Its makers said they were throwing off their "inferiority complex" about Scotch. Scottish distillers also have to compete with American and Irish competitors.

Rachel McCormack, a food and drink writer and broadcaster and author of whisky bible "Chasing the Dram, said: "I remember whisky DYC from living in Spain in the 90s, it's advertising slogan was 'for people with no complexes' when I thought 'for people with no stomach lining'. would have been more appropriate.

"However I am reliably informed that it has improved over the years."

She added: "The Scotch market in Spain and Latin America is really important one (although it's the French who consume most per capita) and it's only natural that local companies want in on the act.

"While they can never legally advertise themselves as scotch whisky they are understandably keen to use as Scottish a branding as possible to give the impression of some connection with Scotland.

"My feeling is that the most successful and respected international whiskies, from places like Japan, Australia and Sweden, are far keener to shout about their own provenance and create new markets whereas making up a Scottish connection is more about easy money, of which of course, there is no such thing."

Ms McCormack's book

Sarah Dickson, international director of the Scotch Whisky Association, said: "Exports of Scotch Whisky to Latin America increased by 12.3% last year to £502m.

"The region has huge potential for future trade with significant room for growth in some markets, notably Mexico, Brazil and the Dominican Republic.

"Mexico is currently the top market for Scotch Whisky in Latin America, worth £132million in 2018, and is the industry's 4th largest global market by volume."

Scottish producers, however do face some red tape and tax headaches across the region.

Ms Dickson said: "Latin America is undoubtedly a priority region for Scotch Whisky exports, but there are challenges to overcome if the industry is to meet its full potential. Complicated tax structures, high import tariffs and a difficult import regime make trade a costly and bureaucratic process in some markets. Working to address these issues is a high priority for the industry."

Whisky with a Latin twist

Millakoru, Chile. A single malt made from local barley and Magellanic peat. It is aged in oak for four years which its maker claims is the equivalent of eight years in Scotland.

What the critics say: it has a bouquet of honey, apricots and licorice but tastes of fruit, toffee and nuts."Unforgettable on the rocks with Jamon Serrano".

Sir Xpecial, Venezuela. Newly launched blend, this is Venezuela's first whisky just as hyper-inflation and economic chaos destroys the market for Scotch. Made with Scottish malt and local cereals and aged in oak.

What the critics say: designed for Venezuelan tastes, it has a nose of wood, dates and honey "in perfect balance" with a robust flavour of soft American oak and vanilla".

Mac Pay, Uruguay. Bottled since the 1970s, this blended whisky, its makers say, combines Scottish malts with local alcohol from local grains. A Uruguayan favourite.

What the critics say: "an acceptable whisky on a local level."

La Alazana, Argentina. A craft single malt made in Patagonia that has already attracted attention from world distillers.

What the critics say: "In the nose, spirity and sour top notes preside over a fatty, unctuous base: butterscotch and a still-sizzling wok-full of chicken in chilli and black bean sauce. Getting into the mouth reveals a thin, watery texture and toffee sweetness."