Whiskey Industry Shifts In Kentucky, With Some Distillers Declaring Bankruptcy
Kentucky has long hedged its bets on its revered whiskey industry, which, according to the Kentucky Distillers’ Association, brings in around $9 million a year. With the whiskey industry shifting along with changing habits of imbibers, some Kentucky distillers have declared bankruptcy, while others are reporting slowed sales.
A new report from Newsweek highlighted some of the struggles the whiskey industry in Kentucky is facing of late, emphasizing the financial woes of Luca Mariano Distillery, which just filed for Chapter 11 under its LMD Holdings business name. The outlet, speaking with the Distilled Spirits Council of the United States, obtained a statement from the association, which reads in part that the “hardships facing distilleries are not unique to those just in Kentucky.”
The statement rings true as there has been a trend among the younger generations of abstaining from drinking and preferring a “dry” lifestyle by ditching booze, sometimes in favor of going “California Sober,” which points to the ingestion of THC-based drinks. The non-alcoholic drink trend, also widely stylized as NA drinks, has exploded as a category over the past few years.
According to the publication, Luca Mariano Distillery launched its operation just this past June and is housed on a 553-acre estate in the town of Danville. Francesco Viola, the brand’s owner, told a local outlet, the Lexington Herald-Leader, that the filing is a strategy to solidify long-term success for the distillery.
Other companies, such as Garrard County Distilling, are struggling as well after it was reported that the Lancaster-based brand was put under receivership and shuttered its operations in 2024. A Google search shows that the distillery is temporarily closed, but little else has been revealed about its future. Stoli Group USA, which produced the award-winning Kentucky Owl whiskey brand, filed for bankruptcy last year, as reported in great detail by Whiskey Advocate here.
In a statement to Newsweek, the Distilled Spirits Council shared that the shakeup occuring right now for the Kentucky whiskey business has hit spirits producers of all sorts, hampered by rising costs for materials to produce the priduct, a drop in sales since the boom of the COVID-19 pandemic, and the looming threat of President Donald Trump’s tariff policies that have halted trade and export between Canada and other nations that often purchase American spirits in bulk.
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