Jim Beam Stops Production At Its Flagship Distillery For A Full Year, Underscoring Struggles In The Bourbon Market

If you've been looking for signs that the Bourbon market is in trouble, Jim Beam just gave it to you. Despite being one of the most popular and recognizable brands of Bourbon in America, the Kentucky company has announced it will temporarily pause production at its flagship distillery located in Clermont, Kentucky. The pause will take effect starting on January 1, 2025, and is planned to last through the entirety of 2026.

While the pause in production is certainly not a great sign, it's not totally disastrous, as James B. Beam Distilling Co. says production will continue at two other smaller facilities. The Clermont location produces around a third of the company's total spirits. In addition to Jim Beam, it also produces other brands owned by the company, including Basil Hayden and Knob Creek. And in a small bit of good news, the production pause will not result in any layoffs, at least for now. Jim Beam has told the Lexington Herald Leader that all production employees will be temporarily reassigned within the company, and the site will remain open for bottling, distribution, and tours.

The company says the facilities will remain closed while it invests in upgrades to the campus, but it's hard to separate this pause from the larger slowdown in the Bourbon market. After years of booming business, the industry has a record number of 16.1 million Bourbon barrels aging in warehouses. And they have this stock while Bourbon sales have started to decline nationwide.

The downturn in Bourbon and whiskey mirrors an overall decline in alcohol sales in the United States, although the industry also faces specific problems. Wine, beer, and spirits sales have declined 5% year-over-year in 2025, and surveys have found that fewer Americans than ever are drinking alcohol, with a Gallup poll revealing only 54% of U.S. adults say they drink, a 90-year low.

That isn't the only problem for Bourbon, either. Sales had already been slowing for years, leading the industry to rely more on foreign exports for sales. But now the President's tariffs and trade wars have led to slowing Bourbon and whiskey exports. American whiskey sales overseas have fallen 12% this year, and Canada, once a major market, has seen a massive 85% drop in imports of American spirits.

Bourbon and whiskey sales have been hit hard. Major brands like Bulleit and Wild Turkey have reported 7-8% sales drops, and Jack Daniel's parent company laid off 12% of its workforce earlier this year. In response to slowing sales and the massive inventory already on hand, Bourbon and whiskey distillers have cut back production significantly this year. American distilleries produced 142 million proof gallons of spirits this year, a 28% drop from 2024. Several Kentucky distilleries have even filed for bankruptcy. While the historic Jim Beam distillery doesn't appear to be in any long-term danger yet, this production pause is auspicious for the industry's outlook in 2026.