Craft distilling industry booming across Texas, but says it’s hindered by prohibition-era state laws

A boom in the state’s craft distilling industry this century has spirits flowing freely in Texas — in spite of prohibition-era state laws that put a damper on sales for upstart businesses. Texans can now take a tour on a nearly 30-stop Whiskey Trail that runs through the Texas Triangle and stretches up to Lubbock, one example of the industry’s rapid growth since Tito’s Handmade Vodka opened the state’s first legal distillery in Austin in 1995. Tito’s is now the top-selling liquor brand in the U.S. But it’s no longer alone. A report published Thursday by the University of Texas at San Antonio showed there were 190 distilleries operating in Texas in 2020, up from just eight in 2008. They generated nearly $2 billion in revenue.

“In the 1990s, you could count the number of distillers in Texas on one hand,” said Thomas Tunstall, author of the study and senior research director at the UTSA Institute for Economic Development. “Now, there are nearly 200 of them in Texas and that number continues to grow.” The growth is part of the broader “farm to table” movement in which consumers have sought to cut out the middleman and get products directly from local producers. “And in this case, distillery to door,” said Kristi Brown, senior director of state government relations at the Distilled Spirits Council of the U.S. “People are looking for products that are made in their own community that are unique and special, and Texas spirits are a perfect example of that.” UTSA conducted the economic impact study for the council, which is known as DISCUS. It found the industry in Texas employs about 1,350 people directly and supports another 3,500 jobs indirectly. Those indirect jobs include workers in transportation or on farms that supply inputs such as grains for distilling or fruit for flavoring. Texas grain farmers supplied about 30 percent — nearly $1.7 million worth — of the grain used in spirits in 2020, the study found.