Jim Beam suspends production at first distillery for one year
Jim Beam will cease production at its main distillery through the end of 2026, according to James B. Beam Distillery.
Unbranded – Newsworthy
If you need a stiff drink this holiday season, sorry distillers and distillers.
Over the past year, makers of whiskey and other alcoholic beverages have faced a variety of challenges, from Americans cutting back on their alcohol intake for health and spending reasons to declining exports hampered by trade issues and tariffs.
Restaurants and retail stores won’t be the only ones facing bankruptcy in 2025. Several distilleries across the country have filed for bankruptcy this year, the latest of which is AM Scott Distillery, which was founded in Troy, Ohio in 2022. The distillery, which operates a store in Dayton, filed for Chapter 11 on Dec. 22.
Elsewhere earlier this year, Luca Mariano Distillery in Danville, Kentucky, and its parent company LMD Holdings filed for bankruptcy in August. Devils River Distillery in San Antonio and JJ Pfister Distillery in Sacramento, California (both in May). House Spirits Distillery in Portland, Oregon (April). Boston Harbor Distillery in Boston and Lee Spirits Co. in Monument, Colorado (both in March).
According to an August Gallup poll, the percentage of U.S. adults who say they consume alcohol is at an all-time low (54%), and bankruptcies are partly due to a decline in alcohol consumption. That’s down from 58% in 2024 and 62% in 2023, according to Gallup.
Among people who drink alcohol, the average number of drinks consumed in the past seven days was 2.8, the lowest number recorded by Gallup since 1996. Over the past eight years, he was measured drinking approximately four drinks per week.
Spirits suppliers aren’t just concerned about consumption in the United States. Trade tensions, including tariffs, led to a 9% drop in spirits exports in the second quarter of 2025 compared to the same period a year ago, according to the U.S. Distilled Spirits Council’s mid-year export report.
According to DISCUS, exports to the EU, UK and Japan declined during the period, but exports to Canada fell the most, plummeting 85% to below $10 million in the second quarter. In response to U.S. tariffs on Canada, most Canadian provinces banned U.S. spirits from stores, but the country lifted the retaliatory tariffs in September.
“There is growing concern that international consumers are increasingly choosing domestic spirits and imports from outside the U.S., signaling a shift away from great American spirits brands,” DISCUS President and CEO Chris Swonger said in a statement accompanying the report.
Jim Beam Distillery to cease operations in 2026. Is the trade conflict between the US and Canada the cause?
Jim Beam will suspend operations at its flagship distillery in Clermont, Kentucky, indefinitely starting in January 2026. “We are constantly evaluating production levels that best meet consumer demand and recently met with our team to discuss production volumes for 2026,” company officials told the Louisville Courier-Journal, part of the USA TODAY Network, on Dec. 21.
Canadian businessman and “Shark Tank” judge Kevin O’Leary told NewsNation that trade tensions between the U.S. and Canada may be a contributing factor. “This is a self-inflicted mess,” he wrote in a post on X. “When a major bourbon producer goes out of business for a year, it shows that politics, not the market, is getting in the way of common sense.”
Mr O’Leary said the “tariff game” was hurting “businesses on both sides of the border”.
Beer makers also deal with poor business performance
Brewers are also not immune. Most recently, Oregon’s Rogue Ales & Spirits closed on November 14th and filed for bankruptcy on November 24th. Founded in 1988, the brewery “for decades has been known primarily for its innovation and experimentation,” Beer Bible author Jeff Alworth writes on his Viavana blog.
Another longtime industry player, the Iron Hill Brewery & Restaurant chain, founded in November 1996 in Newark, Delaware, filed for bankruptcy in October.
This is the second year in a row that brewery closures outnumber brewery openings, according to the Brewers Association. To date, the industry group has tracked 268 new brewery openings and 434 closures. The trade group says there are 9,778 small, independent breweries in the United States.
“Changes in consumer behavior, retailer rationalization, rising costs due to inflation and tariffs, and more competition than ever make 2025 even more challenging,” Matt Gatchuk, staff economist at the Brewers Association, said in the 2025 Beer Report. “Nonetheless, brewers are working to meet today’s challenges head-on by adjusting their products and, in some cases, their entire business models.”
Beer sales fell 3.1% in dollar terms in the first half of 2025, according to data firm NIQ, which tracked sales at U.S. supermarkets, drug stores, mass merchandisers, convenience stores and liquor stores for 52 weeks ending July 5, 2025. Wine sales fell by 5.9% and spirits by 2.8%.
Growth segment?Ready-to-drink cocktail sales increased by 1.7%.
All of this coincides with a boom in non-alcoholic beer, wine and spirits, with category sales continuing to grow after increasing 27% in 2024 to $829.2 million, according to NIQ.
Dave Williams, vice president of analytics and insights at Bump Williams Consulting, a Connecticut-based alcoholic beverage industry specialist, told USA TODAY in September that consumers are drinking less alcohol for reasons including health and budget.
“There are a lot of concerns about discretionary income,” he says. “Either you try to save money, you try to cut back on spending, or you just have to make different decisions in terms of frequency and quantity.”
Contributed by: Reuters.
Mike Snyder is a national trends news reporter for USA TODAY. You can follow him on Threads, Bluesky, and X, and email him at: mike snyder & @mikegsnider.bsky.social & @mikesnider & msnider@usatoday.com.
