Posts tagged as:

rum

From the Telegraph:

Diageo has sought to take advantage of the continued march of the Chinese consumer by launching an offer worth up to £610m for a local white spirit venture in the Asian country.

The drinks giant said the full offer for the company, which is not expected until the second half of 2010, would give it a springboard to expand its share of one of the fastest-growing spirits markets in the world.

That’s a little over 900 million in US dollars. And yes, that’s the same Diageo that’s currently threatening to take its Captain Morgan production outside the US if taxpayers don’t pick up the tab for a new distillery in the Virgin Islands.

Additional reading: This paper [.pdf] from the Congressional Research Service provides the most thorough, balanced explanation and appraisal of the rum cover over that I’ve seen yet. This blog previously covered the Puerto Rico/Virgin Islands dispute here.

Permalink - Share/Save - Comments (0)

Demon rum, demented tax code

by Jacob Grier on February 24, 2010

I get a lot of liquor press releases every day. Usually they’re about new products or horrible, horrible cocktails designed for marketing efforts. Today’s batch includes a release that’s all about trade and taxes:

MERCEDITA, Puerto Rico–Destilería Serrallés released the following statement from Roberto Serralles, Vice President, in response to a 13-page invective issued by Diageo yesterday claiming a conspiracy to “kill” the Captain Morgan Rum production deal between Diageo/U.S.V.I.

“Destilería Serrallés has consistently highlighted the dangers of permitting that unreasonable and excessive rum subsidies be given to any corporation. Our main focus has been, and continues to be, for Congress to hold hearings and to study the merits of HR 2122. This legislation seeks to responsibly regulate the rum cover-over program by placing an-across-the-board 10% cap on subsidies to the rum industry. This is exactly how Puerto Rico has self-regulated itself for over 40 years. All we are asking is that the playing field is kept level, that fair competition prevails, and quite simply, that everyone plays by the same rules,” said Roberto Serralles, on behalf of Destilería Serrallés. “Assertions to the contrary are just delusional conspiracy theories.”

This is the latest salvo in a long-running battle between industry giants Bacardi and Diageo and by extension Puerto Rico and the US Virgin Islands. Understanding the conflict requires delving into some bizarre aspects of the tax code, so let’s break it down. (And if you want to read Diageo’s lengthy statement, click here.)

For background, there are three main spirits industry players involved in this dispute. Destilería Serrallés is a Puerto Rican distillery owned by Bermuda-based Bacardi and best known for its DonQ rum line. Diageo is a British-based spirits company whose many brands include Captain Morgan spiced rum. Diageo contracts with Serrallés to distill the base spirit for Captain Morgan. The contract expires at the end of 2011 and Diageo announced three years in advance that it would not renew the contract. [Correction 2/25/10: Serrallés is independent, not owned by Bacardi. Bacardi's involvement is alleged by Diageo.]

Virgin Islands Governor John deJongh, Jr. successfully courted Diageo to open its own distillery on St. Croix. Among the incentives offered by the USVI are a brand new distillery funded by public bonds and marketing money to promote Captain Morgan; in exchange, Diageo promises to stay in the territory for 30 years and hire local workers. The Wall Street Journal places the value of these subsidies at $2.7 billion over the 30-year deal.

So far this sounds like fairly standard competition between jurisdictions to offer sweetheart deals to corporations, but it gets more complicated. At issue is a strange US tax provision called the rum cover over. This law requires that most of the rum excise taxes collected in the US be remitted to the governments of US rum-producing territories. They receive the funds in proportion to how much rum they produce. Importantly, it doesn’t matter what countries the taxed rum comes from. If you buy Puerto Rican rum, the revenue goes back to US territories. If you buy Jamaican rum, the tax money still goes to US territories. Territories benefit no matter where rum sold in the United States originates.

This is what has created such perverse competition between Puerto Rico and the Virgin Islands. Puerto Rico knows it’s not going to be distilling Captain Morgan much longer, but where Captain Morgan ends up is of huge importance to Puerto Rico. If Captain Morgan goes to a foreign country PR will still reap the benefits of the rum cover over. But if Captain Morgan goes to the Virgin Islands, USVI will become a proportionally larger distiller and get a correspondingly greater share of excise tax revenues; this is the money USVI is counting on to pay back the public bonds it issued for Diageo.

According to the Miami Herald, the loss to Puerto Rico could be as high as $6 billion over three decades. Thus the territory has enlisted legislators to block the Virgin Islands deal, resulting in a heated battle between the territories and the liquor giants.

It’s hard to put any of the parties involved on a pedestal. Serrallés itself receives significant subsidies from the rum cover over program, about 6% of Puerto Rico’s take (again according to the Herald). Nor is it really fair for Puerto Rico to begrudge the Virgin Islands greater allocation of excise tax revenues, given that the alternative is Puerto Rico taking lots of money for rum it doesn’t even produce if Diageo moves to a foreign country.

The real problem is our insane tax code that sends revenue to territories for rum they may not produce and with no strings attached. Thanks to the rum cover over provision, US taxpayers may soon be funneling their money through the Virgin Islands government directly to Diageo. If you’re Diageo you call that a “historic and innovative public-private initiative.” If you’re a libertarian you call it corporate welfare.

My inclination is to side with Bacardi/Serrallés on this one and support a 10% cap on rum subsidies. Or better yet, we could eliminate rum subsidies entirely, a proposition neither Bacardi nor Diageo is likely to support.

Permalink - Share/Save - Comments (2)

I may have to make some changes as we run low on ingredients, but here’s the intended cocktail menu for our final two weeks, including three new additions. This will go into effect tomorrow:

Aquavit Hot Toddy – Krogstad aquavit, Swedish punsch, lemon, star anise $8

Antigua Old-Fashioned – English Harbour rum, coffee-orange bitters, sugar $8

Smoky Margarita – Herradura reposado tequila, Cointreau, lime, lapsang souchong syrup $8

Portland Stinger – Branca Menta, bourbon, brandy, lemon, grenadine $9

Thyme in a Bottle — Bombay Sapphire, Farigoule thyme liqueur, lemon, maraschino $9

Erica’s Impulse –Brandy, allspice liqueur, lemon, simple syrup, orange bitters $8

H’ronmeer’s Flame – Rye whiskey, sweet vermouth, Ramazzotti, flamed orange zest $9

Witty Flip – Brandy, J. Witty chamomile liqueur, lemon, orange bitters, egg, nutmeg $10

Horatio – Krogstad aquavit, Cointreau, Fernet-Branca, orange bitters $9

Curse of Scotland — Ardbeg 10 year single malt Scotch, Drambuie, maraschino, lemon $10

Queen Bee – Vodka, St. Germain elderflower liqueur, lemon, honey syrup, sparkling wine. $9

On a Whim – Trust your bartender to make you something good

Permalink - Share/Save - Comments (3)

antigua

With my dual interests in cocktails and coffee it was only a matter of time before the two collided in the same glass. Most recently I’ve been experimenting with coffee bitters. Many roots and barks can be used as bittering agents, so why not the pleasant bitterness of coffee beans? My friend Lance Mayhew and I have tried out several recipes for coffee bitters and with batch #5 we’ve hit on a combination that I find very satisfying. We use Lemonhart 151-proof rum as a base and add in a few complementary flavors like orange peel and star anise. The final product has a distinct coffee aroma and taste without overpowering the other ingredients; it might be more accurate to call these coffee-orange bitters given the strong orange note they produce. (Coffee geeks will be interested to know that the beans are Stumptown’s Costa Rica Herbazu; how much of a difference origin makes in these bitters is yet to be determined.)

My favorite use for the bitters so far is in a rum Old-Fashioned. I’ve tried this with a number of rums, searching for a spirit to give the drink the right amount sweetness without tipping too far in the direction of strong caramel flavor. My favorite so far is English Harbour, an Antiguan rum with just enough time in barrel to give it depth. It’s well-suited for a classic Old-Fashioned preparation:

2 oz English Harbour rum
.5 tsp superfine sugar
2 dashes coffee bitters

Stir all ingredients to dissolve the sugar, add ice, and stir again. Finish with a strip of orange peel.

The rum Old-Fashioned with coffee bitters has been a popular off the menu item at Carlyle for a couple months now and will be making the jump to prime time later this week.

Permalink - Share/Save - Comments (5)

A bevy of booze reviews

by Jacob Grier on December 22, 2009

It’s hard to believe 2009 is almost at an end. Among my unfinished business is a stack of spirits up for review. Time’s a wastin’, so let’s get to it…

Gosling’s Ginger Beer — A few months ago I wrote about trademarking cocktail names, a discussion inspired by an ad run by Zaya touting its rum as an ingredient in a Dark ‘n Stormy (traditionally made with Gosling’s rum, ginger beer, and a squeeze of lime). It turned out the name of that cocktail is owned by Gosling’s, who defended the trademark. I sided with Zaya at the time and in response Gosling’s kindly sent me a six-pack of their ginger beer so that I could experiment with the drink.

The beer has a fairly strong ginger kick which is essential in this cocktail. And as they say, the Gosling’s rum makes a tasty Dark ‘n Stormy. But here’s the thing: So does Zaya. I tried them side-by-side and enjoyed them both. They’re different, with a bit more of the rum coming through on the Zaya, but I can’t imagine anyone getting turned off this drink because they tried it with Zaya instead of the original Gosling’s.

In defense of Gosling’s, I understand why they want to defend their trademark so that it’s not used by low-quality rums. And I’d gladly recommend its use in this cocktail, especially given that it can be found for one-half to a third of the price of Zaya. However I stand by my earlier general stance against trademarking cocktail names.

House Spirits White Dog and Barrel Strength Whiskeys — As microdistilleries have boomed across the country we’ve started to see releases of whiskey along with the usual vodkas and gins. While often interesting, I don’t always find that these new whiskeys are worth their boutique prices. Two that are come from Portland-based House Spirits’ newest additions to its apothecary line. The unaged White Dog, made of 100% malted barley, is hot and complex with an intriguing malty flavor, easily my favorite of the white dogs I’ve tried so far. Their cask-strength whiskey aged for 32 months in new American oak is good as well, with a big, spicy kick mellowed by caramel notes from the wood. With only 150 375 ml bottles of White Dog and 160 375 ml bottles of Barrel Strength released, these are hard to find and worth adding to one’s whiskey collection. (House has released a 750 ml Straight Malt whiskey too, but I haven’t purchased a bottle yet.)

Pernod Aux Plantes D’Absinthe Superiore — I’m by no means an absinthe connoisseur but when a bottle of Pernod arrived at my door I was happy to try it out. The first thing I noticed was the strikingly green color, the result, unfortunately, of adding artificial dyes. I suppose they’re doing this to meet customer expectation that absinthe is green but I’d rather see the natural results of maceration.

It louches predictably in a traditional preparation. Without sugar it has a lingering bitterness; with sugar it smooths out. I might use it as an accent in cocktails but with so many other absinthes on the market now it wouldn’t be my choice for drinking on its own.

Xanté Pear Liqueur — Given the sex-fueled marketing that used to attend this product I was expecting a cloyingly sweet, night club-style liqueur. I was pleasantly surprised to find that this is actually a well-balanced spirit. At 76 proof it’s not excessively sweet and the pear flavor is strong but not overwhelming. It’s enjoyable to sip with an ice cube or two and I could easily see it working in fall or winter cocktails.

Balcones Rumble — We’ll wrap up with a product from my home state. Balcones Rumble is distilled in Waco, Texas from wildflower honey, turbinado sugar, and mission figs. The nose is unique and the flavor has sweet, stone fruit notes. I like the initial taste but the lingering heat is a bit much, comparable to a cigar that burns too hot. I’d like to try this product again with a little more aging or perhaps a lower proof, but it’s nonetheless an original spirit I’m glad to have on my shelf.

Permalink - Share/Save - Comments (1)

Dark ‘n’ Sue Me

by Jacob Grier on August 4, 2009

The Dark ‘n’ Stormy is a cocktail I like on a summer day. And like any good bartender, I know that it’s generally made with Gosling’s Black Seal Rum. What I didn’t know is that the name of the drink is a legal trademark:

That’s according to two trademark certificates on file with the United States Patent and Trademark Office, which — in an exceptionally rare instance in the cocktail world — dictate the precise ingredients and amounts required to call a Dark ‘n’ Stormy, well, a Dark ‘n’ Stormy.

“We defend that trademark vigorously, which is a very time-consuming and expensive thing,” said E. Malcolm Gosling Jr., whose family has owned Gosling’s since its founding in Bermuda in 1806. “That’s a valuable asset that we need to protect.”

But a trademark-protected drink — especially one as storied and neo-classically cool as a Dark ‘n’ Stormy — seems anathema to the current bartending practice of putting creative individual spins on time-tested drinks. Drinks like this one undergo something like a wiki process: a tweak here, a substitution there, and the drink is reimagined.

As this article at Halogen Life notes, applying intellectual property to cocktails is a rare thing. (The article uses “patent,” “copyright,” and “trademark” somewhat interchangeably, but I think it generally intends to refer to trademarks.) An early example (non-trademark) is the Bacardi cocktail, which by court decision can only be made with Bacardi rum. This is understandable given the value of the brand name and the expectations of customers ordering it. Similarly, if a customer orders a Captain and Coke the bartender shouldn’t serve him a Sailor Jerry’s and Pepsi instead, at least not without asking. (Though I have to wonder if it’s possible to harm the Captain Morgan brand any more than one would do by actually serving Captain Morgan.)

Of the few cocktails that are trademarked, most are the gimmicky concoctions found in chain restaurants and tourist spots. The Dark ‘n’ Stormy is a rare trademarked cocktail that craft bartenders care about.

This would all be of merely intellectual interest if not for the fact that a competing rum company, Zaya, ran an ad in the most recent issue of Imbibe recommending its 12 Year Estate Rum in a Dark ‘n’ Stormy. According to the New York Times article quoted above, Gosling’s plans to take action protecting their trademark. Zaya responded with a press release arriving in my inbox on Monday:

Zaya Rum fully supports Mixology as an artform. By imposing a trademark or patent on a cocktail recipe one is suggesting to undermine a Mixologists’ artistic freedom. We applaud bartenders who put their personal thumbprint on a libation as an integral part of the artform; it’s what creates a recipe in the first place.

Gosling’s might be on solid legal ground, but as a craft bartender I’m firmly on the side of Zaya. I use Gosling’s in a Dark ‘n’ Stormy because it tastes good, but it’s hardly written in the fabric of the universe that no other rum pairs so perfectly with ginger beer. If another rum company thinks they’ve made a product that’s even better, I want them to tell me about it. Using unique ingredients in classic cocktails is part of what makes tending bar creative. For example, a couple weeks ago my pal RumDood wrote about his good results substituting different rums in the Painkiller, a cocktail marketed by Pusser’s Navy Rum. It’s that kind of experimentation that moves mixology forward.

Gosling’s contends that using any other rum in a Dark ‘n’ Stormy would leave customers unimpressed, decreasing sales of the cocktail and therefore of Gosling’s itself. Perhaps. The New York Times compares Gosling’s to Campari, but you don’t see bartenders throwing other Italian aperitifs willy-nilly into Negronis despite that drink’s not having any trademark that I know of. Or they give the drink a new name if they do, like the Cin-Cyn using Cynar; not because they’re required to, but because Campari really is distinctive enough to merit its own iconic cocktail. This kind of bottom-up market test is a working method of deciding when a recipe deserves a distinct name.

So when I see Gosling’s calling in the lawyers to prevent people from trying out substitutes, I start to doubt whether their rum is as good as they say it is. Hell, they’re a rum company. Would this kind of behavior impress Ernest Hemingway? Or would he mock them from his bar stool whilst demonstrating knife stunts and tossing back a daiquiri? The question answers itself!

Here’s the three-word response I’d rather see from Gosling’s: “Bring. It. On.” Dark ‘n’ Stormy competition, blind tastings by a panel of consumers and mixologists, sampled side-by-side. The loser pays for the winner’s ad campaign touting its brand as the ultimate rum for the Dark ‘n’ Stormy. What do you say, Gosling’s? Will you put your money where your mouth is?

No, of course they won’t. And I can’t say I blame them. They’ve got a good thing going with their trademark and no reason to risk losing it. But their actions have made me want to switch brands out of spite. If a “Dark ‘n’ Sue Me” shows up on my cocktail menu soon, you’ll know I found a winner.

Further discussion: Inventor’s Rock provides legal clarification and Vidiot at Cocktailians provides an excellent overview of coverage.

Update: It’s worth noting that Australian rum maker Bundaberg markets a bottled Dark and Stormy beverage. I have no idea if they have any plans to enter the US market, but keeping that particular bottle off of store shelves might be one reason Gosling defends its trademark so vigorously.

Permalink - Share/Save - Comments (7)

Stone Fence

Tonight’s a night for backyard grilling, tossing a baseball, eating absurd amounts of food, and enjoying the sunshine. Unless you’re me. I’ll be stuck working behind a bar. But if I were joining you all outside, I’d be cheering independence with a Stone Fence:

1.5 oz aged rum
hard apple cider

Pour both ingredients over ice, stir, and enjoy.

Apple cider usually brings to mind fall flavors, but this is pleasant and refreshing in the summer. More importantly, some form of this drink is what supposedly gave Ethan Allen and his Green Mountain Boys the liquid courage they needed to storm Fort Ticonderoga and take it from the bloody British in 1775. So goes the legend, anyway, and legends that give us an excuse to celebrate with tasty cocktails are worth perpetuating.

In Imbibe! cocktail historian David Wondrich suggests that for true authenticity one should use 115-proof Bundaberg rum (not available in the US) and brew your own cider. That seems like a lot of work for a holiday. Inexpensive aged rums like Appleton Estate VX or Bacardi 8 will do nicely. For the cider I’ve been experimenting with Crispin, a new American brand intended to be served over ice. While some of their products are a little sweet for me, I really enjoy their brut cider. The fact that it comes in convenient 12 oz bottles is another point in its favor.

This drink eventually evolved into a less potent but still tasty libation combining bourbon and non-alcoholic apple cider. A couple dashes of Angostura bitters is a nice addition; this is the version you might have tried if you were at Cato’s Repeal Day celebration last year. When we head into fall and winter, this variation really hits the spot.

Permalink - Share/Save - Comments (2)

Sangre de fresca

Today’s Mixology Monday is all about rum, a spirit of which I know virtually nothing. Sure, I use it in an occasional Mojito, Cuba Libre, or Dark and Stormy, but I haven’t experimented with many different bottlings or with more adventurous flavor combinations. For this MxMo, then, I didn’t strive for anything original.

Instead I turned to The Art of the Bar, the fantastically inventive cocktail book from Absinthe Brasserie and Bar’s Jeff Hollinger and Rob Schwartz, and source of one of my favorite recipes of late: the Sangre de Fresca.

The Sangre de Fresca features cachaca. Some might say this doesn’t count as a rum, but it is distilled from sugar cane and rum has always played fast and loose with its definitions. I’m mixing with Leblon, which actually calls itself a Brazilian rum and is barrel aged, so I’m going to go with it. For the sticklers in the audience, I’ll shake one up with rum, too. It’s a sacrifice I’m willing to make; I drink to make you happy. Here’s the recipe:

2 hulled strawberries
4-5 basil leaves
.5 oz balsamic syrup*
1.5 oz cachaca
.25 oz Cointreau
.25 oz lime juice
soda water

Muddle the berries, syrup, and leaves. Add the spirits and lime juice and shake with ice, then strain over rocks and top with soda. This makes a nicely refreshing drink. The ripe, fruity smell of the cachaca pairs really well with the balsamic syrup, and of course strawberries and balsamic vinegar is a winning combination.

To tie this more perfectly to the rum theme, I’ve also tried this a few times with Rhum Barbancourt, a Haitian rum aged for four years, in place of the cachaca. This makes for a smoother drink, but the more powerful cachaca stands up better to the other strong flavors at play; the Brazilian spirit’s the way to go here.

To follow the rest of this month’s MxMo’s entrants, check in with Trader Tiki for the recap. And for an informative article on rum, see Paul Clarke’s recent piece in The San Francisco Chronicle.

*For the syrup, dissolve 1.5 cups of sugar into half a cup of water in a saucepan over medium heat. Stir until the water dissolves and the sugar caramelizes to an amber color. In a separate pan, simmer 1.5 cups of balsamic vinegar. Then take both off the heat and carefully add the vinegar to the caramelized sugar. Be careful, it will spatter messily. Heat the mix a few minutes longer until it thickens, cool it an ice bath (it retains heat very well), bottle, and store in the refrigerator. It’s a nice thing to have around and lasts a long time.

Update 5/13/08: Trader Tiki’s got your wrap-up right here.

Permalink - Share/Save - Comments (4)