Asahi Group Holdings is increasing storage capacity for its Japanese whisky brand Nikka to meet demand and grow in international markets.

The Tokyo-headquartered group is investing Y6bn ($37.7m) to build a cask warehouse at its Tochigi plant. Once operational, expected in September, the facility will have space for “tens of thousands” of casks, an Asahi spokesperson told Just Drinks.

The company said it is in the planning stages for additional warehouse structures at its Yoichi and Miyagikyo distilleries, with operations forecast to come online in the next “few” years.

“In addition to expanding physical storage, efforts are also underway to secure sufficient casks for ageing. With the new warehouse at the Tochigi Plant in operation, we expect Nikka whisky's overall whisky storage capacity to increase by approximately 10% compared to its capacity in 2021,” Asahi said.

It follows a Y12.5bn investment in production between 2015 and 2021, including expanding storage facilities at Yoichi and Miyagikyo.

Around 90% of Nikka whisky sales are in its domestic market. The US is its largest export customer, followed by France and Germany. The brand is in 59 markets globally and Asahi said it aims to grow that to 65 by 2025.

Nikka whisky sales for 2023 were Y53.4bn, up 15% on the previous year. The group forecast sales will grow by 4% in 2024 to Y55.5bn.

“The global whisky market is being driven by growth in the mid-to-high price range whiskies. To enhance Nikka whisky's presence as a premium brand globally, we are intensifying our initiatives, primarily in the US and Europe,” Asahi said.

In March, Asahi appointed Kirsch Import to handle the distribution of Nikka whisky in Germany and Amsterdam-headquartered Monarq announced it would be distributing Nikka to the Caribbean for the first time.

Kirsch Import, which also distributes Ballantine’s Scotch and Black Velvet Canadian whisky, took over the rights to Nikka from Stock Spirits’ Borco.