For those of you familiar with the stock market, you may have heard the term ‘market correction’ being used occasionally, especially over the last several years. Not to be confused with a crash or a collapse, in investing sense, a correction refers to a drop of 10% – 20% in major stock indexes such as the FTSE 100, for example. 

While a market correction can be scary for first-time investors (you always remember your first) they’re actually considered healthy for the markets and are necessity for ensuring stocks aren’t overvalued. 

Now, don’t worry, I’ve not suddenly decided to branch out into financial advice, (please do not take financial advice from me, it’s whisky I specialise in) but rather I’d like to talk to you today about the whisky markets, particularly our beloved Scotch. 

You see, 2026 is shaping up to be a bumpy year for the whisky industry. With 1 in 5 distilleries experiencing financial troubles, along with many facing overproduction issues, there are concerns that the industry is in trouble. 

Ever the optimist, I’ve decided to take a look at a few reasons why I believe the markets should settle later in the year. 

This Isn’t a Collapse, It’s a Correction

Now that I’ve expertly explained the difference between a correction and a collapse, we can now look in more detail at why the recent issues plaguing the industry are down to a market correction rather than a collapse. 

Between 2020 and 2022, global whisky sales surged. Not only did people have more disposable income, but interest rates were incredibly low for both savers and businesses alike. Put simply, people had more money, people wanted to treat themselves to fine whisky, people bought more whisky, and it cost producers less to produce the whisky. Supply and demand also helped to artificially inflate the price of a bottle of whisky so average prices of a bottle of whisky increased.

Unfortunately, in 2022, that brief period where people actually had more money in their pockets came to a screeching halt. Global conflicts, sky-high inflation, ridiculously high energy prices, rising interest rates, and looming taxes and other duties meant whisky sales began dipping, and producing whisky also became more expensive. 

Because of this, whisky sales have dipped slightly, both nationally and internationally. According to the Scotch Whisky Association (SWA) exports to the USA fell by 3.7% in 2025. This year, with talk of tariffs on everybody’s lips, that number could drop further (though experts don’t believe it will). 

The good news is that experts believe we will soon be reaching a ‘bottom’ and that sales should start to pick up in the latter half of the year, or ‘H2’, if you want to be all official. Once this happens, the markets should quickly stabilise, as should prices, and whisky should prove to be enormously profitable once more. 

Producers are Taking Action

Make no mistake about it, this is NOT another ‘Whisky Loch’ scenario like we saw in the 1980s where the industry nearly collapsed entirely. What we’re seeing here is troubling, but thanks to what happened previously, we are now blessed with hindsight, and we can learn from past mistakes. 

Overproduction, combined with economic problems meant that distilleries in the 1980s were sitting on more whisky than they could sell. They had the equivalent of a literal ‘lake of whisky’ and couldn’t get rid of it quickly enough. This resulted in a huge amount of turmoil in the industry and the closure of multiple distilleries.

While some distilleries today are facing overproduction issues, the good news is that they are taking action, rather than hoping the problem will go away on its own. Both Diageo and Jim Beam for example, have temporarily paused production in a number of their distilleries to prevent the problem from getting worse. They’re also temporarily scaling back operations and closing visitor centres during quieter periods in the season to help cut costs and save money. 

While this is not ideal, it certainly beats the alternatives. During the 1980s, close to 30 distilleries were either mothballed or permanently closed down. Others fell silent for many years, decades even, before being reawakened. The fact that producers are taking action now shows how seriously they’re taking things. A temporary pause in production for a year is certainly better than a distillery being closed permanently and potentially demolished.