U.S. bourbon maker IJW Whiskey plans to build a distillery in Japan’s northern island of Hokkaido in a bid to capitalize on surging global demand for Japanese-made whisky.
The distillery will be constructed in the city of Chitose by Cedarfield, IJW’s local subsidiary established in Tokyo. Production is to start as early as next year.
The group acquired 165,000 sq. meters of land at an industrial park adjacent to New Chitose Airport. The scale of the facility will be on par with Kirin Holding’s Fuji Gotemba distillery, one of the world’s largest, located at the base of Mount Fuji.
IJW’s new facility will check off all the boxes in making authentic Japanese whisky, including using local water and maturing batches for three or more years within the country’s borders.
Mass-producing whisky requires a vast amount of space for storing the barrels used to age the whisky. The investment will run in the hundreds of millions of yen (100 million yen equals $764,000). The plant will have column stills for grain whisky.
Only a few other places in Japan have this type of equipment, and it is nearly unheard of for a non-Japanese company to enter the industry at this scale.
Last year, Japan exported 56 billion yen worth of whisky, up 20% from 2021. The value of whisky exports topped that of refined sake in 2020, and whisky became the leading product in this category.
The global alcoholic beverage market exceeds 100 trillion yen, according to the National Tax Agency, but Japanese products account for only 0.1%. The fact that Japanese whisky is hard to find and expensive overseas attracted Cedarfield’s focus.
The parent IJW, headquartered in Kentucky, has been labeled “secretive” and “mysterious” by U.S. media in stories about its large land purchases in Kentucky. Company President David Morduchowitz has rarely given interviews.
IJW reportedly has a 400,000-sq. meter facility in Kentucky with 100,000 barrels of whiskey maturing in storage.
Cedarfield plans to hire Japanese engineers in addition to bringing in talent from the U.S. People who were involved in setting up the company’s American facility have been living in Hokkaido since 2022.