Features 20 August 2019

The cult of Karuizawa

It’s one of the most sought-after whiskies in the world, yet it started life as blending fodder, and its stills went cold 20 years ago. Richard Woodard on the astonishing story of Karuizawa

Words by Richard Woodard

Photography by Martin Morrell

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In late 2007, I was researching an article about the looming phenomenon of Japanese whisky when I received a sample in the post. It was a small bottle bearing a scrawled, handwritten label: ‘Karuizawa 1981, Cask #103. 58.1% abv.’ The liquid inside was richly opaque, with powerfully resinous and fragrant exotic flavours. This was Japanese whisky – indeed, whisky of any type – elevated to a new level. It was also £75 ($97) a bottle, which I remember thinking was a bit ambitious for a Japanese distillery nobody had heard of.

Twelve years on, a bottle of that same liquid sells at auction for £2,000 ($2,580) and more. In Karuizawa terms, this is affordable: the distillery’s oldest expression, a 1960 bottled at 52 years old, was released in 2014 at £12,500 ($16,140) a bottle; in May last year, Bonhams sold one in Hong Kong for HK$2.45m (US$312,130), making it the most expensive Japanese whisky yet sold at auction. All this from a distillery in operation for less than 50 years, for most of that time an unloved workhorse pumping out liquid for cheap blends, before being scrapped in 2000, unwanted, surplus to requirements. Karuizawa spent its life in anonymity; only after death has its star risen and its true value been assessed and appreciated.

Japanese whisky is sometimes unfairly caricatured as some kind of pastiche of Scotch; if the truth is rather different, the legend has an appealing storybook logic to it. Whisky rode into Japan on the coat-tails of improved trade links with the west in the Victorian era, and as its popularity grew, local companies sought to replicate it. Initially they did this by concocting lab recipes involving base spirit and flavourings; soon they wanted to create something more authentic.

In 1918, 24-year-old Masataka Taketsuru travelled to Glasgow to study chemistry. A few years later he returned to Japan with a Scottish wife, Rita Cowan, and experience gained from a series of apprenticeships at Scottish distilleries, including Longmorn in Speyside, Hazelburn in Campbeltown, and Bo’ness near Falkirk.

His timing was perfect. Shinjiro Torii had started his Kotobukiya wine business in Osaka in 1899 but was now expanding into whisky and needed someone to run his new distillery. Together, he and Taketsuru opened Yamazaki in 1923 before the pair split, with Taketsuru heading north to open the Yoichi distillery near Sapporo 10 years later. The two companies they created, Suntory and Nikka, are the titans of Japanese whisky to this day.

Increased contact with the outside world brought not only whisky to Japan but wine, too. In 1934, Daikoku, one of the new breed of Japanese wine companies, built a winery near Karuizawa, a spa town with restorative powers initially recognised by western missionaries then embraced by overseas visitors and the Japanese alike.

Located high in Japan’s Southern Alps, on the knee of the active Mt Asama volcano and within easy reach of Tokyo, Karuizawa’s currency as a chic resort for the well heeled has risen over the years. It’s said that Emperor Akihito met his future wife Michiko on a tennis court here, and John Lennon and Yoko Ono were regular visitors during the 1970s.

Japanese whisky is sometimes unfairly caricatured as some kind of pastiche of Scotch; if the truth is rather different, the legend has an appealing storybook logic to it

When the Karuizawa winery opened, Daikoku was already dabbling in whisky. By the 1950s, whisky was on the rise, and the company started looking around for somewhere to make it. Karuizawa, with its plentiful supplies of volcanic-filtered water, was the perfect spot. Winery became distillery.

In February 1956, the first clear spirit ran from Karuizawa’s four stills, but there was little fanfare and certainly no premonition of greatness. This was a small-scale operation, making a component of the company’s low-priced Ocean blended whisky. It was a mere bit player, never meant to be the star of the show. And yet, with 20/20 hindsight, there was always something intriguing about the way Karuizawa was made. Its use of Golden Promise barley, its small stills and its maturation predominantly in ex-Sherry casks have echoes of Macallan; combine this with the frequent use of peat, long fermentations and coal-fired stills, and you have a recipe for big flavours and a distinctive character.

But none of that necessarily makes the whisky any good. Karuizawa pottered along supplying the Ocean blend, and intermittent single-malt releases at 12 years old failed to excite. In 2000, Karuizawa’s stills fell cold. The fickle Japanese fashion that embraced whisky had had its fun and moved on, to shochu. Nobody wanted Karuizawa’s whisky; it was redundant.

By 2006, the company that owned Karuizawa – along with other wine and whisky assets – was called Mercian, and Mercian was bought by Japanese brewer Kirin. The few that pondered the potential of Karuizawa hoped for good news: might the distillery reopen under its new owner? But no. Kirin, it turned out, was only interested in Mercian’s wine business; whisky could go hang.

And for Karuizawa, that might have been that. The distillery had been silent for years, and the remaining stocks – 350 or so casks of whisky of varying ages – were, in Kirin’s view, blending fodder, to be lost in a nameless product used to generate some cash flow. Six years after buying Karuizawa, Kirin sold the site to a real-estate developer.

But those 350 casks weren’t blended and lost. Instead, they were bought by Marcin Miller and David Croll, co-founders of Number One Drinks Company, a specialist importer of Japanese whisky.

Miller was one of the few who knew of Karuizawa but wasn’t really a fan of the regular releases from the distillery. ‘I suppose it just didn’t stand out,’ he recalls. ‘It was intended to be a fast-moving, commercial whisky. It just wasn’t very good.’ But what everyone knew of Karuizawa was the standard, 12-year-old bottling. Those 300 casks held much older liquid, from the 1970s and 80s – incredibly, given the distillery’s role providing filling for blends, from as far back as 1960.

There’s a parallel here with Scotch. Port Ellen is the most mythical of the single-malt pantheon – the Islay distillery, the story goes, that was cruelly shut down in 1983 by soulless money men who were blind to its greatness. Like many others, Miller doesn’t see it that way. ‘Diageo wouldn’t have closed the distillery had Port Ellen been the most successful, exciting whisky in its portfolio,’ he says. ‘But it wasn’t.’

A cult of the magnitude of Karuizawa is due to a number of factors: rarity, a rapidly diminishing commodity and scarcity

What nobody knew – about Port Ellen and, more pertinently, about Karuizawa – was what changes might be wrought by time. Both whiskies benefited hugely from long-term ageing: 20 years, 30, 40. The sulky adolescents bottled during the distilleries’ lifetimes soften and mature, acquiring an unforeseen complexity and power that transcends their supposedly humble origins.

For Miller, there were two epiphanies. One was his first taste of the whisky sample he later sent to me – Karuizawa 1981, Cask #103. ‘That was an amazing moment,’ he says. ‘It was quite heavily peated, and that was when it all really came together.’

The other epiphany came in 2009, when Miller looked at 69 casks of Karuizawa and found that 68 of them were good enough to be bottled as single-cask whiskies – a remarkable hit rate, given the notorious inconsistency of individual whisky casks.

It would be disingenuous to pretend that Miller and Croll didn’t want to make money out of Karuizawa, but early pricing was modest, relatively speaking. ‘We did want others to taste what we had tasted,’ says Miller. ‘We were going to whisky shows and pouring it out for people. That wouldn’t happen now.’

Shortly after that legendary 1960 Karuizawa bottling was released, Number One sold the remaining casks of Karuizawa to Taiwanese entrepreneur and whisky collector Eric Huang. In 2020 – the year that Tokyo hosts the Olympic Games – we’re likely to see the last single cask Karuizawa releases.

A cult of the magnitude of Karuizawa is due to a number of factors. Chiefly, there is rarity, the sense of a rapidly diminishing commodity, the value attached to scarcity. Timing plays a part, too; the Karuizawa cult took hold in the first decade of this century, just as collectors in the Far East felt their first sense of disillusionment with blue-chip Bordeaux. But in the end, quality will out. However crazy Karuizawa pricing may have become over the past five years, the hype is rooted in the undoubted quality that, suddenly, was apparent to everyone.

It is sometimes suggested that Japanese whisky, unlike single malt Scotch, is not a product of place in quite the same way. Karuizawa gives the lie to that. The microclimate of the distillery, high in the Japanese Southern Alps, created remarkable maturation conditions for whisky. While Scotland’s humidity and relatively consistent temperatures lead to a gradual loss in alcoholic strength – the fabled ‘angels’ share’ – Karuizawa’s average daily mean temperature swings from less than 8C in winter to 25C in summer. (It remains the only town to have hosted events in both the Winter and Summer Olympics.) This means that alcoholic strength in maturing Karuizawa casks remained remarkably high, concentrating flavour and character – hence that high strength of 58.1% in the Cask #103 bottling from 1981.

The Port Ellen parallel with Karuizawa has its limits. While the former is now to be resurrected, with its Islay distillery rebuilt in the next year or two, Karuizawa is, it would appear, incapable of revival. Only the ghosts linger, such as those remaining Karuizawa casks, soon to be bottled and gone.

Meanwhile, Miller and Croll have moved on, establishing the Kyoto Distillery. There they make not whisky but an exemplary Japanese gin, Ki No Bi, which contains an array of Japanese botanicals from yuzu to sanshō pepper. It should come as no surprise that the cask-aged Ki No Bi variant is sometimes put into casks previously used to mature Karuizawa whisky.

In 2019, partly thanks to the cult of Karuizawa, Japanese whisky of any age is in short supply. Distilleries are springing up to fill the gap, and one of them – Shizuoka – has acquired three of Karuizawa’s stills. Sadly, only one of the three is still operational; the others are simply too neglected and decrepit to function. Once the last few drops of Karuizawa are released, probably next year, the story of this remarkable whisky will conclude in auction rooms and in the memories of those lucky enough to have sampled it. Then it will be gone.

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