So, the pair asked a deceptively simple question: could we make alcohol from bread?

The answer was yes. But “yes” turned out to be considerably more complicated than it sounded.

The alchemy of leftovers

The food rescue products that become the mash for the distillery. Image Rose Kelly

Today, unwanted bakery products arrive at the distillery from food-rescue organisation Kiwi Harvest and other local suppliers. Importantly, this is food that cannot otherwise be redistributed for people to eat.

The process is surprisingly physical. Around 200 kilograms of rescued bakery product can go into a batch, mixed with water and malt before being heated into a thick mash. The starches and carbohydrates are converted into fermentable sugars, the solids are filtered out and yeast is added to the resulting liquid. Over about five days, fermentation converts those sugars into alcohol. Then comes distillation.

The fermented bread wash is pumped into the distillery's 500-litre reflux still, where it is distilled into a high-strength semi-neutral spirit. Rather than importing or purchasing a commercial base alcohol, common practice among gin producers, Dunedin Craft Distillers makes its spirit from scratch. That distinction matters.

The bread isn't a sustainability flourish added to the story after the fact. It is the raw material.

The resulting spirit can then head in several directions: gin infused with botanicals, vodka, liqueurs and digestifs, seasonal creations such as mulled gin, or whisky left to slowly develop in oak.

And McDonald is particularly interested in what is happening inside those whisky casks.

“I’m getting quite excited about the whisky we are producing,” she says. “It has a lovely layered vanilla effect. It’s accentuated as it sits in the cask.”

There is something wonderfully subversive about it: unwanted bread, destined for a rubbish truck, emerging years later as a complex whisky with layers of vanilla.

Nothing wasted

Dr Jenny McDonald, co-founder of Dunedin Craft Distillers. Image Rose Kelly

The circularity doesn't end when the alcohol leaves the mash.

Once the sugars have been extracted, the spent solids still have nutritional value. Rather than throwing them away, the distillery passes the mash solids to nearby local dairy company Holy Cow, where they are fed to its small herd of Jersey cows.

Those cows, in turn, produce milk used for local dairy products. Bread becomes alcohol. The remnants become cattle feed. The cattle produce milk and butter.

Waste becomes an input for the next producer.

Even the water carries a distinctly Dunedin signature. The finished spirit is proofed using rainwater harvested from Mount Cargill before being filtered at the distillery.

For McDonald and Stockwell, sustainability isn't particularly useful if the drink at the end of the process isn't excellent.

Their Bay Gin has provided some persuasive evidence on that front, winning gold in London. The distillery has also attracted international attention far beyond what might have been expected of a tiny operation at the bottom of New Zealand.

A bigger pot

The products are making their mark on Dunedin’s foodie scene. Image Rose Kelly

Success created another problem. Making alcohol from bread is difficult to scale.

Bread mash is thick, awkward and labour intensive, and the pair's early production involved hours of physical stirring. As demand grew, they needed a much larger purpose-built mash kettle to process greater quantities of rescued bakery goods.

So, they turned to their community.

In 2024, Dunedin Craft Distillers launched a crowdfunding campaign with a NZ$25,000 target to commission the new equipment. Supporters pledged more than NZ$27,000. The upgrade meant a process that had previously taken three days could be completed in one.

It's an appropriately grassroots chapter in the story of a business that has never behaved much like a conventional spirits company. McDonald and Stockwell weren't career distillers searching for a clever point of difference in an increasingly crowded gin market. They were trying to solve a waste problem.

By June 2024, the business had already diverted 10 tonnes of bread and bakery products from landfill. And perhaps that is what makes Dunedin Craft Distillers interesting beyond the bottles themselves.

Luxury is increasingly being asked to justify its footprint. Provenance, craftsmanship and rarity still matter, but so does intelligence: where something came from, what resources were consumed to create it, and what happens to what is left behind. In Dunedin, that thinking has produced an unlikely new equation.

Starch becomes sugar. Sugar becomes alcohol. Waste becomes something worth savouring.

And somewhere inside an oak cask, yesterday's bread is slowly becoming tomorrow's whisky.