Jim Beam, a famous bourbon brand with over 230 years of history, will stop making whiskey at its main Kentucky distillery for a full year starting January 1, 2026. This marks the first such pause in modern times at the Clermont site, which employs nearly 1,500 workers. The halt stems from lost exports to Canada, too many aging barrels, and fewer people drinking alcohol. It delivers a big economic blow to owner Suntory Global Spirits and the entire U.S. whiskey industry.
Trade Tensions Spark the Shutdown
The pause began with a sudden trade fight between the U.S. and Canada. In March 2025, Canadian liquor boards quit buying American spirits after the U.S. slapped wide-ranging tariffs on imports under President Trump. This caused U.S. spirits exports to Canada to crash by 85% in the second quarter of 2025, falling below $10 million.
Kentucky distillers had relied on Canada as a steady buyer. Bourbon needs years to age, so producers can’t quickly sell barrels elsewhere when a market vanishes. Instead, whiskey piled up in warehouses, worsening an already massive stockpile.
Bourbon’s Boom Turns to Bust
Bourbon thrived for most of the 2000s, fueling Kentucky’s $9 billion distilling economy through exports and tourism. Jim Beam started in 1795, and companies expanded fast during the boom. They filled more barrels and built extra warehouses, betting on endless growth.
Aging takes years, often until after 2030 for many barrels, so past choices now trap producers. By 2025, Kentucky held a record 16.1 million barrels. As global sales slowed and U.S. demand dipped, this glut turned a success story into a crisis.
Changing Habits Fuel the Glut
Americans are drinking less, adding pressure on the industry. A 2025 Gallup poll found just 54% of U.S. adults drink alcohol, the lowest in over 30 years. Another poll showed 53% now view moderate drinking as harmful.
Younger people favor options like cannabis over traditional spirits. Bourbon sales, which grew steadily for nearly 20 years, flattened by mid-2025. Analysts call this a lasting shift, not a short slump. With exports gone and home sales weak, warehouses overflowed with whiskey no one could sell soon.
Inside Jim Beam’s Year-Long Pause
Suntory confirmed it will halt all distillation at the James B. Beam campus in Clermont throughout 2026. This site makes about one-third of the company’s bourbon, making the move a major cutback. Spokespeople call it a smart adjustment to match lower demand, plus time for site upgrades. It’s temporary, not a closure. The company will keep distilling at its Booker Noe plant in Boston, Kentucky, and a small craft site in Clermont. Bottling, storage, and tours at Clermont will continue.
About 1,500 Kentucky jobs link to Jim Beam’s Clermont operations, vital for local families. No layoffs are planned, but workers worry about shifts in roles and stability. Unions push for firm promises on job moves.
Rivals face the same woes. Diageo cut whiskey production in Kentucky, Tennessee, and Texas in 2025 due to stockpiles and soft demand. Suntory also deals with a leadership shakeup: CEO Takeshi Niinami quit in September 2025 amid a police probe into cannabis-related supplements, though it doesn’t touch bourbon directly.
Uncertain Path Forward
Eyes turn to January 2026 U.S.-Canada trade talks, which could lift tariffs and revive exports. Yet recovery will take time. Millions of barrels must age into the 2030s, and fewer drinkers mean slow sales. For Jim Beam’s Clermont workers and Suntory, 2026 tests a 230-year legacy. The industry must adapt to trade wars, health trends, and excess supply without losing its Kentucky roots.
Sources:
Distilled Spirits Council of the United States (DISCUS) — American Spirits Exports 2025 Mid-Year Report — October 16, 2025
The Spirits Business — US spirits exports to Canada plummet 85% in Q2 — October 6, 2025
The Spirits Business — Ageing Bourbon barrel numbers hit all-time high — October 8, 2025
WBUR/Here & Now — Jim Beam pausing main Kentucky distillery for 2026 — December 22, 2025
The Spirits Business — Main Jim Beam distillery to cease production for 2026 — December 22, 2025
Gallup Poll — U.S. Drinking Rate at New Low as Alcohol Concerns Surge — September 8, 2025