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Chateau Haut-Brion

 

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The quality of a Grand Cru comes from the convergence of natural and human factors. It is the result of a marriage in which, thanks to the patient virtues of empiricism, nothing is predominant or vital, but everything proves to be essential. As such, Chateau Haut-Brion stands out as a prime example. It is both a model and the precursor of the Bordeaux Grand Cru…..Through its location, beginnings, and its past and present, you will come to learn of a great Chateau where at all times attentiveness and vigilance are the watchwords to make the most of nature” (Source: ‘Forward’ in property brochure – 2014)

 

 

There is no other estate in Bordeaux that can offer documentation to such a glamorous and esteemed history than that of Chatea185u Haut Brion. Deriving from the Celtic term ‘Briga’ (meaning a rise or mount) – it is clear that the abitlity to cultivate vines on this land was realised as early as the 1st century. On the 23rd of April 1525, Jean de Pontac, a civil and criminal clerk of the Parliament of Bordeaux, wed the daughter of the Mayor of Libourne – Jeanne de Bellon. Within her dowry was included the land known as ‘Haut-Brion’. Within 8 years, for 2,650 Tournois (Pounds) the ‘mansion’ Haut-Brion was purchased by the couple and so brought together both house and lands, forming the birth of Chateau Haut-Brion as we now know it today.

 

Over the next century, the estate’s reputation grew and improved notably throughout France and beyond. By 1660, the wine was to be found on ‘cellar-ledger’ of King Charles II – and served to guests at the royal table. This is one of many references to the ‘wine of Hobriono’.

Probably the most quoted reference was made by Samuel Pepys (English naval administrator and Member of Parliament who is now most famous for the diary he kept for a decade while still a relatively young man) after visiting the Royal Oak Tavern in London on the 10th April 1663 – “There I drank a sort of French wine called Ho-Bryon that hath a good and most particular taste I have never met with”. Clearly the ‘New French Claret’ had become noticed enough to warrant inclusion on a royal dining table and join the London rumour mill and indeed in Mr Pepys’ no famous diary!

 

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The most famous of all references over the centuries must be those made by the third President of the United States, Thomas Jefferson. Following his visit to Bordeaux in 1787 he wrote of “The soil of Haut-Brion, which I examined in great detail, is made up of sand, in which there is near as much round gravel or small stone and a very little loam like the soils of the Medoc”. He went on to list Haut-Brion as one of four vineyards of ‘prime quality’.

The now famous estate exchanged ownership between various dignitaries in 18th, 19th and 20th Centuries. In 1935, New York financier Clarence Dillon purchased the estate and began an extensive programme of renovation for the entire estate. Today, the Domaine Clarence Dillon is still overlooked by Clarence’s descendants and its future assured in the safe hands of Prince Robert of Luxemburg. Their acquisition of St. Emillion property -Chateau Tertre Daugay in 2011 certainly took many by surprise. However, the renaming into simply, ‘Quintus’ and the further purchase of it’s neighbouring property Château L’Arrosée – bringing the total area of vines to 28 hectares, is proof that their eyes are fixed firmly on the future growth for the Domaine Clarence Dilon family. In fact, Prince Robert of Luxemburg spoke of his confidence that their aim for success is true – “We anticipate Quintus in time becoming an equal to our other estates”. A truly bold statement indeed, but one made clearly with passion and dedication the family brand.

 

Of course it is the wines that are the real legend. Haut-Brion produces both Red and White wines, as well as a second red called Le Clarence de Haut-Brion, and a second white named La Clarte de Haut-Brion. However, it is the Red wines that have proven their worth and hold legendary status: from 1811 (known as the wines from the comet); 1874 (at time of release, up to 5,500 French francs were exchanged for just one barrel); 1929; 1945 (despite 80% of the crop being destroyed by heavy snow at the beginning of May); 1947 (hottest summer for fifty years); 1949; 1959 (thought at the time, and even before the harvest, to be the best of the century); 1961 (legendary throughout Bordeaux); 1982 (again legendary throughout Bordeaux);1989 (an outstanding year can only produce outstanding wines); 1990; 2000 (to be enjoyed today, tomorrow and probably 100 years from now); 2005 (similar climatic conditions to that of 1949 but unique in its own right); 2009 ( a wine makers dream due to the perfect conditions throughout the growing season).

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The Beautiful Stones

The September sun shone magnificently upon walls of this majestic Classified 2nd Growth Chateau – designed by Parisian architect, Paul Abadie160 for Bertrand Ducru, who purchased the estate in 1795. Ducru invested in the whole estate; vineyards as well as cellarage benefited from up-grades made at the property and were rewarded when the Chateau received Second Growth status in the 1855 Classification in the Medoc.

Looking out towards the Gironde, one can easily soak up the tranquillity and drift back in time to the days even before this magnificent building was built. Ducru Beaucaillou is one of the oldest wine making estates in the Medoc. Records go back to the early part of the 13th Centaury for this St. Julian property, but it wasn’t until 1795 when Bertrand Ducru took ownership that we know more details of the evolution that has taken place since.

After over seven decades, Ducru sold the estate to the wife of a well known and respected Bordeaux merchant and negociant Nathaniel Johnston – for no less than one million French Francs. This was an enormous amount of money to pay for such a property – however, Johnston had the foresight to develop the estate even further. He began by re-planting some of the vines as well as further investment in the cellars. Together with Ernest David (the estate manager), Johnston experimented with various aspects of viticulture – creating  ‘Bordeaux Soup’ – a blend of lime milk and copper sulphate – made to tackle the ever present mildew that daunted the Bordeaux estates each year. The ‘soup’ was so successful that vineyard owners all over the world adopted the solution to fight against the disease.
158Unfortunately, after huge amounts of losses – caused primarily by the global meltdown of the ‘Great Depression’, Johnston was forced to sell the property to another Bordeaux merchant family, the Desbarats. Yet it seems at this time, owning such properties became a most challenging and resource draining prospect. The estate exchanged hands once again a little over 10 years later to a certain Francis Borie. – Another well known and regarded merchant who held experience and passion in the ownership of other vineyards in Pauillac. Francis Borie decided that this would become his legend and so pass onto generations of his family.

 

Bruno Borie, direct descendant of Francis, is responsible for the transformation and quality that Ducur Beaucaillou is indebted to. Like many estates, the selection of only the finest grapes is used for the Grand Vin. In the 1980’s, the estate produced approximately 20-25,000 cases each year. By the 1990’s, this was reduced to 15-20,000. Since 2003, when Bruno Borie took full management, this figure has now been reduced further to approximately 9-11,000 cases per vintage. It seems that Ducru Beaucaillou are now firmly at the top of their game. It is clear that the quality of wine matches their more esteemed Medoc neighbours of First growth stature. From 2000-2011, the wines have received an average score of 94/100 from the respected US critic Robert Parker Jr. This level of recognition has not been un-noticed by savvy investors; who see the estate’s wines to hold real value. In fact this average score over the same period matches the great First growth Mouton Rothschild – from where their Cellar Master, Rene Lusseau, learnt his trade for five years before spending the last 30 years at Ducru Beaucaillou.

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During a ‘Bordeaux Blend’ (2009 vintage) ‘Blind-Tasting’ held in September 2013, over 30  wines from across the globe were pitched against each other; including Super Tuscans Ornellaia and Solaia, California’s Dominus, the finest from Australia, Chile and South Africa – as well as First Growth properties Mouton, Lafite and Latour. Ducru Beacaillou came out top!

During our visit, we were honoured with a personal tour by Monsieur Lusseau – during which he shared fond memories of his time at the great First Growth estate mouton Rothschild. However, his pride and joy clearly lies firmly amongst the beautiful stones at Chateau Ducru Beaucaillou, and the many ‘children’ he has helped raise! – A metaphor he uses for all the wines he has helped create over the past thirty years.

Cool for Cats……. During our visit it was Cellar Master, Rene Lusseau, who guided us through the Chateau grounds and cellars, as well as inside the great building itself. Joking at some of the Fine Art that is installed within and beneath the majestic palace – his favourite and probably the oddest I have come across in any Chateau was the ‘illuminated Cat’. Hanging in the cellars that sit directly beneath the Chateau, a ‘neon’ cat stands (bouncing a ball) on guard against any vermin that dares enter the building. Rene jokingly mentioned that since the ‘cat’ had been there – no vermin had been found!

 

 

 

 

 

 

 

 

 

 

 

“Chateaux Montrose is a wine that has always possessed First Growth potential. It has one of the most glorious expositions in all of Bordeaux, with a view of the Gironde (and unusual for Bordeaux, one single block of vines totalling 235 acres).” Robert Parker, Wine Advocate #214

Driving along the D2E4, just north of the infamous village of Pauillac on the banks of the great Gironde estuary, you will find the gentle slopes of vines leading up towards the horizon on your left and the entrance to Chateau Montrose. During the summer months from May on wards, bright118 colourful cosmos flowers stretch over the low-levels at the entrance to help Mother Nature encourage the busy insects and bees to do what they do best – help creating a truly romantic atmosphere as you make your way upwards towards the Chateau itself.

This was our third visit to the property – our first was back in 2005, before Martin Bouygues (the French tele-communications giant) purchased the estate a year later and invested in areas (over €55m) that were necessary to take this well loved estate to the next level. It is said that after drinking a bottle of the estates’ 1989, Martyn Bouygues instantly fell in-love with the wine – so much so that he and his brother Olivier wanted ownership! From that point on, it seems the continued changes brought through their investments, including the most recent appointment of ex-Mouton Rothschild’s administrator – Herve Berland, shows commitment and a will to achieve even greater things for the future.

The centre piece, quite literally for this project lies beneath – the new cellars. This was his first project for the property and it is truly an immense sight.

Montrose Cellar pano

There is great emphasis on an eco-friendly profile for the estate – with a high environmental quality; ‘low-energy’ consumption buildings; a geothermal refrigeration system; a photovoltaic production of about 400kw on the whole site; an ultimate aim to limit the reliance of ‘city-water’ by recycling rain and ‘used’ water over time.

 

The Vineyard

«The river has a decisive influence on the Montrose vineyards. It is impossible to make great wines under extremely hot or cold conditions. It is necessary to note that the finest Médoc wines generally come from vineyards along the river. In the past, the river was essential for shipping these wines. Centuries ago, gabarres, or large flat-bottomed barges transported Médoc wines to shippers in Bordeaux. From there, fast Dutch sailing ships took these wines to countries in Northern Europe and spread their reputation far and wide». Jean-Bernard Delmas

096As of 2014, the vineyard is completed with 60% cabernet Sauvignon, 32% Merlot, 6% Cabernet Franc and 2% Petit Verdot. The current average age of the vines is at 41years; in-line with the strategy of ‘re-planting’ and aims to keep this average in excess of 40 years.

The vineyard lies in northern Medoc. As mentioned, the land slopes gently towards the great river, where the tide and sheer amount of its surface acts as a ‘shield’ against the severe elements Mother Nature can cast upon the region; softening the frost in the winter and cooling the summer heat. In the summer months, the large stones found in the topsoil (said to have originated from mountains in Massif Central and the Pyrenees), absorb heat from the sun and release it slowly at night, helping to ripen the grapes.

Each year since 1973, the estate employs a team of Spanish pickers who travel from a small village in the heart of Andalucia, Spain. With only one leader, the team are dedicated to the Chateau to complete the harvest. Marie Guyonnaud, our host for this visit, ensured us they not only work hard, but party hard once the work has been done!

 

The Wines

Two days before our visit, Robert parker published (Wine advocate #214) his notes on a vertical tasting (1920, 1935, 1945, 1953, 1958, 1970, 1976, 1982, 1989(from his own cellar), 1990, 1996, 2003, 2005, 2009, 2010) which took place at the chateau earlier in June. As well as re-affirming his admiration to the Montrose style and their ageing ability, he re-graded all these vintages; with up-grades of note to the 1989 (98+), 2003 (99) and the 2010 which he awarded his perfect 100 points! As is the norm, the up-grade on the latter to 100 points sent traders buying this stock wherever available and consequent price rises on what is left!

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Old wooden vats at Chateaux Montrose – now redundant and used as only a back-drop for corporate events.

 

As luck would have it………………We were fortunate and thankful that we were able to115 taste both Montrose 2010 and La Dame de Montrose 2010! Needless to say, both Oliver and I were left gobsmacked by the Montrose 2010 – a splendid wine and true classic Bordeaux style; both elegant and noble. The ‘Dame’ 2010 was a little more discreet, bringing recurring notes of raspberry and a hint of vanilla and chocolate. Alongside the Montrose, we were offered the sister, Chateau Tronquoy- Lalande 2010. Great precision of fruit with silky tannins that showed excellent balance between finesse and matter! All three wines were a testament to the whole operation under the teams at both chateaux.

 

The Beautiful……………

Chateau Clos FourtetChateau Clos Fourtet
1er Grand Cru Classe B, St Emilion
Production; Average 4,500 cases; Second Wine – Closerie de Fourtet
Vinification takes place in temperature controlled, stainless steel vats. Malolcatic fermentation is performed in barrel and aged for 18 months in 60% to 80% new French-oak.

Now and again it is worth bringing to the attention of my beloved audience; that’s my wife, Pluto & Luna – the dogs, and of course your kind self! – Magical estates that are missed through the hustle and bustle of the headliners……………….

For those who have visited the Right Bank of the great Gironde estuary, would most certainly have strolled up and down the cobbled streets in the romantic village of Saint Emilion. Its charm is overwhelming and unforgettable. Literally on the outskirts of this medieval fortified settlement (on the northern side), enclosed by the familiar pale-gold limestone that seems to encompass this region everywhere one looks, and but a stone’s throw away, is the 18th Century Chateau Clos Fourtet.

We have been selling wine from this estate for some time now. Some of our clients have been amazed with the consistency of unique Chateau Clos Fourtet 2expression and complexity each vintage brings. Of course the ‘magical’ 2009, a wine which received Robert Parker’s optimum score of 100 points, has really helped bring this Chateau into focus. The following 2010 also scored well by the influential critic – achieving 98 Points – highlighting in his notes the fact that ‘This property has been on fire, qualitatively speaking, for well over a decade.’(Wine Advocate February 2013).

For us, we can only echo Parker’s view that since the present owner, Phillipe Cuvelier, brought in Jean Claude Berrouet and Stephane Derenoncourt, (seeming to be effectively blending their contrasting wine-making styles into a more bio-dynamic driven approach, creating flamboyance and purity at the same time) who are now turning heads in the market towards this often over looked property.

Chateau Clos Fourtet 3The Chateau itself stands above huge caves where the stone was carved away to help build and repair buildings within the village over the centuries. The space left is used by the estate to store the oak casks alongside revered bottles that make up the Chateaux reserves. This subterranean environment is perfect for the maturation and preservation of the wines. This spectacle is well worth a visit and will amaze those fortunate to set their eyes upon.

Chateau Clos Fourtet 4

FAKE & COUNTERFEIT WINE – SCRATCHING THE SURFACE, eBAY, CORKS WITH FINGERPRINTS……AND A PSYCHO….

There have been quite a few alarm bells ringing around the world of Fine Wine recently. Whilst this issue has been wrapped within the market since time began – as with most – the ‘real’ fear that is being sounded through many commentators suggests that the on-going trial of Rudy Kurniawan is a case that is merely “Scratching the surface of something that is huge” according to head of Chai Consulting Maureen Downey during a speech at a wine industry conference, the Hong Kong International Wine & Spirits Fair. She went further, “How much fake wine he was able to throw into the market… we have no idea” – A concerning comment indeed! Maureen Downey is a lady whose comments we should take seriously – Although no exact figure was used, a recent story published in The Drinks Business suggests there may be as much as 20% of global Fine Wine sales deemed fake!

FAKE & COUNTERFEIT WINE

 

On line auction house – eBay have recently defended their anti-fraud measures when concerns were raised after a recent court case regarding the availability of fake wine labels on FAKE & COUNTERFEIT WINE 2their site. Armand Aramian received a four month jail sentence in Bordeaux after he was found guilty for ordering fake Mouton Rothschild labels (reputedly from China) and then reselling them to an eBAY seller in 2010. In an interview in Decanter, Lawyer for Mouton Rothschild, Andrea Lindner-Jamin, acknowledged that the presence of fake labels on eBAY is a problem, ‘It is very disagreeable, but the most important thing, is that we are watching out and we are ready to act quickly, as this case proves.’ A spokesperson for eBay said the group already takes a tough stance. ‘eBay’s extensive anti-fraud measures include the Verified Rights Owner Program (VeRO), which allows rights owners to quickly and easily report copyright infringements. ‘eBay promptly investigates each notification and all listings duly reported are removed, and eBay’s global asset protection team cooperates with authorities in investigations, to strengthen the fight against fraud.’

Italian manufacturer, Brentapack has created the ‘IDCORK’ system that they claim will allow users to access details of a wine’s history via an app (using corks imprinted with individual codes), which is designed to “guarantee the authenticity of the wine”. Following the launch of their product at the International Enological and Bottling Exhibition in Milan, Brentapack spokeswoman, Anna Michelazzo said “The composition of a cork is like a fingerprint, the natural holes within it, the little cracks, make it unique – a one-off.” Brentapack CEO, Gianna Tagliapetra, claims “In a few seconds and with a few clicks, you will be able to ensure that the contents of the bottle are not an imitation”.

FAKE & COUNTERFEIT WINE 3

PSYCHO……………..Finally, the name that is synonymous with ALL of the above…… Rudy Kurniawan! It has been widely reported that the defence lawyers, acting for the master of disguise (of the wine market that is -currently being held in a Brooklyn detention center) – due to the now infamous case where millions of dollars of fake wines have (oh yes -allegedly!) traded through his hands, will plead insanity! According to the Wine Spectator, one of Kurniawan’s Lawyers, ‘Jerome Mooney of Los Angeles, was quick to shoot down any talk of insanity pleas but did not explain why a psychiatric examination was necessary. “We are not seeking and do not anticipate, an incompetency claim or an insanity defense,” Mooney wrote in a Nov. 8 letter to Berman. “It is not our intention to attempt to delay the trial. Instead, there are certain things that have come to our attention during our brief time with our client that we believe require further evaluation.”’ ……………………………………

FAKE & COUNTERFEIT WINE 4

During the past 14 months I have mentioned (wherever possible) the potential of right bank properties ‘soaking-up’ the value in the Bordeaux market. The apparent opportunities were amplified after confirmation of the latest St Emilion Classification where Chateau Angelus and Chateau Pavie received their promotion to Classe A in the rankings – giving them the same classification as the esteemed Chateau Cheval Blanc and Chateau Ausone.

The ‘gap’ in value – offered investors huge potential to make short term gains in a market that should normally be viewed as a long term horizon for steady growth. Whilst the ‘gap’ has closed – there is still room for growth.

The upsurge in trading for these two brands; Chateaux Pavie and Chataeu Angelus, has propelled them to 1st and 2nd place (respectively) the Liv-ex Power 100 (published by the London International Vintners Exchange and The Drinks Business) – an annual list of the most powerful (traded) brands from the fine wine market.

Whilst Chateau Pavie climbed 2 places from its 2012 position to take the No.1 spot, Chateau Angelus managed to climb 21 places to 2nd position in the 2013 listing.

Despite this recognition
, the signs have been there for some time. After the promotion to Classe A – Pavie’s owner, Gerard Perse suggested “The move up to A will no doubt increase the value”. His wife, Chantel Perse, justified the hike in the price of their 2012 En Primeur release “we increased our price by around 58% – to reflect our new classification. If we hadn’t done it, it would have been ridiculous”, so much was her confidence in their decision that she stated, “I believe it’s important to define the difference between the classifications”.

‘Right Bank’ wines from the Bordeaux region now dominate the top 6 places in this year’s Power 100 list. This is testament to the change of direction the market has taken in the past 12 months. Last year’s top spot DRC has shown signs of falling from grace over the past 6 months, however similar to Bordeaux, there is still plenty of interest in Burgundy with seven brands from this region joining the list. Chateau Lafite and Chateau Latour, down to price performance have slid to 18th and 15th place respectively, whilst under-valued Chateau Haut Brion has pushed up 6 places to 6th on the list.

Whilst slight changes were made to method in which Liv-ex calculated the results (see below notes from Liv-ex), the List (in our opinion) does present an interesting view on how the trading environment of the fine wine market is shifting (for now), and which wines are in demand – and which wines are not!

Liv-ex Power 100 methodology notes (Source: Liv-ex.com) 
“This year we changed our methodology slightly to better reflect the market. We have grouped wines together as brands (e.g. Carruades de Lafite is incorporated with Lafite Rothschild under brand Lafite) and have placed more emphasis on secondary market trades.

Our starting point was to take a list of all wines that traded on Liv-ex in the last year and group these by brand. We then removed all those that had traded lightly. Brands were ranked using five criteria: year on year price performance, average critic score (we used Robert Parker’s scores where possible, and where none were available we used The Wine Spectator, Allen Meadows, Stephen Tanzer and James Suckling), trading performance on Liv-ex, number of wines and vintages traded, and average price. Only the wines and vintages that traded on Liv-ex in the last year were included in the calculations.

The individual rankings were then combined with a weighting of 1 for each criteria, except trading performance which had a weighting of 1.5 (as it combined two criteria). The final 100 brands accounted for over 1600 unique wines/vintages traded in the past year.”

There should be no surpriseIn 1955, the wines of St Emilion, Bordeaux were classified, and unlike the Bordeaux Wine Official Classification of 1855 – the St Emilion list has been updated 5 times; 1969, 1986, 1996, 2006 and most recently in 2012. There are of course winners as well as losers in this scenario. In fact the 2006 classification was declared ‘invalid’ – after various legal ’actions’ made by some of the ‘losers’. – Excuse the pun here, but ‘sour-grapes’ is a natural reaction when such acclaim is taken away and one is facing a complete restructure of not only pricing and all that comes with profit and costing – but also the ‘image’ and marketing of  a brand that has been knocked down a peg. Huge swings in value for wines made by the winners and losers of such ‘honours’ are made – not only by the estates themselves but for those who play the fine wine investment speculation game as well as the consumer.

Due to the ramblings caused by the 2006 Classification and its aftermath – accusations by four disgruntled properties eventually forced a ‘null and void’, and so a return to the 1996 Classification was applied – however a different approach was conducted in 2012 to try and appease any concerns and offer un-bias decisions.

There was no involvement by the St Emilion Wine Syndicate and Bordeaux trade – instead professionals from Burgundy, Rhône Valley, Provence, Champagne and the Loire Valley were instated as a seven-person commission. Alas, even with such ‘independence’ the final analysis and submitted Classifications received some grumbles from Château La Tour du Pin Figeac, Chateau Croque-Michotte and Château Corbin-Michotte who each filed complaints with a Bordeaux administration tribunal earlier this year in January.  – A natural defensive move me thinks here.

In just over 12 months, clear opportunities are still plenty………….. The obvious winners from the 2012 Classification were two Chateaux that have been creating superb wines for some time – Chateau Pavie and Chateau Angelus.

Chateau Pavie…… Twaites & Jones have been promoting Pavie for quite some time – since the 2000 Vintage to be precise.  The quality since Monsieur Perse (1998) has taken over the reins has been incredible – even in the most challenging years. Notable vintages are 2000, 2003, 2005, 2009, 2010. The Chateau is a favourite of Parker, and despite her claims of ‘Parkerisation’ in some Bordeaux wines (If JR’s tasting notes and comments seem to suggest! -OOPPS! I let that slip!!!!)  – Jancis Robinson has found it harder to appreciate the concentration that Pavie favour.Chateau Pavie

Despite the long standing argument amongst critics (mostly Anglo-American – and we all know who!),     there remains little agreement that Pavie is either an extraordinary Claret style, or rather a ‘Port-like’ wine.     It must be said there has been some slight hypocritical comments made by the ‘Anglo’ side of the argument during ‘blind-tasting’ Pavie’s back vintages – having to back-track and reiterate past comments to make their case seemed (to me at least) somewhat amusing!

The fact does remain though, the style of Perse’s wines are not the traditional style everyone is akin to from this region. His style is amplified during years when the conditions have favoured such concentration, however there have been many who in their tasting notes for the 2012 Vintage (for example) have let out a sigh in relief, claiming the wine has ‘calmed’ slightly, allowing a ‘fresher’ and more approachable to the style of wine

Chateau Angelus

 

Chateau Angelus has also been on a good run since the mid 80’s, despite a prolonged period of mediocre prior to that date, Hubert de Bouard has turned this estate into one of St Emilion’s superstars. The most recent Vintages of note are the 2000, 2005, 2009 and 2010.

The recent classification has created a vacuum of value between these newly appointed estates and their ‘Premier Grand Crus Classes A’ piers; Cheval Blanc and Ausone. With most vintages priced more than double that of the newcomers, it is surely down to time before the gaps are closed. Some may say – perhaps not – but from our perspective with the recent En Primeur release prices for the 2012 Vintage seeming to back this theory up, the smarter money leans to this area of the Bordeaux market compared to an exhausted (it seems for now) left-bank market.

Liv-ex noted “solid activity on the secondary market and substantial price moves across all recent vintages” since both estates was upgraded last year. Chateau Angelus has seen slightly more success than Pavie for Vintages ranging from 2000-2009; 37% and 29% respectfully.

Below tables offer an over-view of the respective wines, values, scores and movements. The figures tell an interesting story when compare to Cheval Blanc, also classified in the illustrious St Emilion 1er Grand Cru Classe ‘A’. (All figures sourced from Liv-ex, based on ‘market values’)

THE PAVIE STORY……….

 THE PAVIE STORY

Average Robert parker score: 96.86 (using + as .5) over 11 years.

THE ANGELUS STORY……..

THE ANGELUS STORY

Average Robert parker score: 94.63 over 11 years.

THE CHEVAL BLANC STORY ……….

THE CHEVAL BLANC STORY

Average Robert parker score: 94.09 over 11 years.

Despite the fine wine investment market catching on to the clear value available in wines from the two properties there still seems some way to go over the mid term – something you don’t hear about too often these days!

If you are one of many investors out there looking for opportunities and would consider the field of play within the fine wine investment market, there is one major rule you should at least start with if you decide to take the plunge…………

With your research concluded and confident (as you can be) – realising that wine investment does indeed offer an excellent way to diversify your investment strategy – weighing up the risk and exposure over the mid-long term horizon to increase your wealth accordingly seems as good a bet than any – as well as being ‘inflation-proof’; you begin to cipher through the numerous merchants and brokers that will win your business.

So who do you choose to buy your wine from?

In the UK, the list is long. From within the list there are many that should be avoided at all costs – then there are those that offer fair game but need to cover the extortionate over-heads (due to their location, running costs and of course share-holder dividends) – which are then passed onto clients via management fees and excessive ‘spreads’. One should also point out at this time the ‘secondary-market’ indices that have been introduced to the investor over the past twelve months; open trading platforms where investors and collectors trade between themselves whilst paying a ‘trading fee’ – after paying . These are useful, but require at least TEN years of market experience to truly identify a real opportunity – so be warned.

So, you have narrowed down and shortlisted the companies that will source the wines for you. At this point, you will no doubt have been ‘charmed’ more by one than the other and have been swept away with the one thing that gets to us all………GREED!! – Before you know it – the most dangerous of all sins has consumed your entire research without chewing first and allowed you to be blindfolded and led down a path that may turn out to take longer to reach your intended destination than you originally intended!

However, one would hope that within the ‘age of information’ we meander through today and aides such as Wine-Searcher (.com) which advertise wines sold into the ‘secondary’ market of the investor – there is sufficient evidence available to make comparison when assessing prices.

The first and most important rule

Despite price being one of the main factorshere when buying wine, the FIRST and MOST important rule is something that will often be missed for novice investors in the wine market. In fact even some of the major merchants here in the UK fall foul of this FIRST and MOST important rule. It is often a circumstance that allows those less desirable companies to take advantage of (by multi-trading the same stock over and over again), and in order to overcome scenarios that so often plague the wine investment arena (most recently the likes of Bordeaux UK and Vinance) – the dreaded ‘Umbrella (storage) Account’ has been the cause of so much misery – when simply following the FIRST and MOST important rule one can safe guard your asset from such travesties……..

The FIRST and MOST important rule for fine wine investment is…………………..

OPEN A PRIVATE STORAGE ACCOUNT WITHIN THE UK BONDED WAREHOUSE SYSTEM (HMRC REGISTERED) TO STORE YOUR WINE – PROTECTING YOUR ASSET AS WELL AS BEING INSURED AGAINST DAMAGE, GIVING YOU FULL CONTROL AND SAFEGUARDING THE PROVENANCE SO THAT WHEN THE TIME IS RIGHT – YOU CAN SELL AT THE BEST MARKET PRICE!

 

Recommended and Independent (HMRC Registered) UK Bonded Warehouses:

London City Bond (LCB) – http://www.lcb.co.uk/

Vinotheque (LCB) – http://www.vinotheque.co.uk/

Octavian – http://www.octavian.co.uk/

 

The wine market has various levels of interest for those who wish to benefit from the possibilities of wealth generation, but equally as important for wealth preservation.

There are those that focus on the strong secondary market demand; generally relying on the lucky consumers who at their pleasure, indulge in the world of fine wine. After time and careful cellarage these wines are ceremoniously brought out of their subterranean world, decentred and consumed in the majestic moment that has been anticipated since it was bottled. These wines are priced according to market conditions; in whatever moment they are consumed.

Then there are those that target wines that are to be left and admired only for the inscription on the label that dresses the bottle (and the imagination) to resist temptation that eventually (out of curiosity) is broken – delivering its notes and flavours of ‘time’ that have been left dormant for so long, but washed away in an instant! Such experiences cost small fortunes! These wines truly are valued (like beauty) in the eye of the beholder.

Of course, like anything that is consumed from a finite supply, pressure increases on the availability of remaining stock. Since the dawn of time, such commodities have been sought after in the same fashion as today. As time passes, of course trends occur, but there will always be one dominating source; in the wine market that source is Bordeaux.

The difference in today’s fine wine market when comparing for example twenty years ago, is that ‘new’ consumers will want to broaden their experiences. In today’s ‘global’ environment, access to the vast supplies of wines from all corners of the world is becoming easier and with this is a growing appreciation to the quality available. In turn the realisation that each region has its own unique style and price becomes more apparent to these ‘new’ consumers. And, whilst Bordeaux Claret may appear expensive, the acceptance of the power and precision these wines offer is over time becoming clearer.

In today’s demanding (high-end) consumer market, quality is paramount to achieving successful sales. This is no more recognised than in Bordeaux. It seems even in the most demanding years, the Bordelaise combine their knowledge and expensive technological aides to create excellent wines year after year. This however comes at a cost; actual production levels have been falling in the past ten years in their search for perfection. Where the norm used to be 25,000 cases (12/75) per vintage – from First Growth properties, we now see an average production of 12-15,000 cases.

Pause for thought then………….. The below graph (Source: Wikipedia) indicates the population growth since 1800. The global population is expanding at its fastest pace since the 1960’s and is expected to continue for some time. This combined with recent data (Some Key Facts) from the Cap Gemini RBC World Wealth Report 2013 …………..

investment-wines

Some Key Facts

  •     Investable wealth of HNWIs is expected to grow to US$55.8trillion by 2015
  •     Geographic Wealth Allocation of HNW is Globally

30.4% – Asia-Pacific
30.2% – North America
26.5% – Europe
6.1% – Latin America
6.8% – Middle East and Africa

  •     HNWI Allocations to Investments of Passion Globally

31.6% – Jewelry, Gems and Watches
19.0% – Luxury Collectables (Cars, Boats, Jets, etc.)
16.9% – Art
8.0% – Sports Investments (Sports Teams, Race Horses, Sailing, etc.)
    24.2% – Other Collectables (Inc Wine)

  •     32.7% of HNWIs were most focused on wealth preservation, whereas 26.3% were most focused on wealth growth

Hopefully you just may get the picture!!!!!!!!!!

For those who read the drivel I put on the T&J blog (of whom I am of course grateful to)  – would (I hope) appreciate that sometimes one can offer a candid view of the world that revolves around us, and more precisely; the fine wine market. But more often than not, there will always be some substance lying between the lines – that holds some significance to the big wide world we live in, and most definitely a pinch of ‘relevance’ to the market from which I earn my crust (I did warn about the drivel part) …………..

As is my preference (and out of necessity), I clicked  through the various financial www’s this morning (as is part of my breakfast ritual) and noted interesting headlines on the expected increase to China’s airline fleets – ‘to triple in size within 20 years’! Many of the related articles referred to the ‘super’ nation’s GDP still going full-steam-ahead, (compared to most of us), at a rate of 7.5% – according to ‘official’ figures.

Wings & Bottles

Now I am no economist (alas only a mere wine broker)……but this got me thinking………….      It really should come as no surprise to hear such news – the land of the Dragon is tipped to become the world’s super-power by 2050 – (oh no, sorry that has just been revised to 2030!). The recent doom and gloom cast upon this ‘land-of-plenty’ surely was somewhat exaggerated and perhaps drawn from the Whitehouse shadows?? So the country’s GDP has slowed down from almost double figures (despite recent rumours even these figures had been ‘cooked’ by local governments to gain additional funds) – which had been sustained for so long – but as the rest of the world struggles in its own mire – the obvious repercussions to the Dragon should have been seen coming. However, the fact that such colossal wealth-creation within, and burgeoning middle-class during this time have taken to the luxuries on offer to them; it again should be no surprise that they really have developed a taste for all things fashionable. From a Koenigsegg Agera R to a Hennessey Venom GT (these are sports cars by the way!?); a Renoir to Constable; Cartier to Chopard – they want it all – and then 2 of the next big thing! This goes for the very finest Wines and Spirits, and like all those who have passed before them, their appetite for knowledge within these walls of luxury seems insatiable.

The real net-wealth figures for the ultra-wealthy in China are quite eye-watering – compared to some of the big players in the West. But the fact that these guys have really only just started will again surprise many – whose ignorance is clear when they gasp at yet another Chateaux purchase within Bordeaux heartland.

Wings & Bottles 2

The point I am trying to make here is that their ‘new’ membership to the world of extravagance should be taken with the seriousness is deserves.

We should no longer become shocked by the pace at which the country’s newly ‘shared’ wealth expands into our back yard!

Lookout the ‘Bilderberg Group’ – stock up your cellars because the Dragons are here to stay and they (like you) want to drink it ALL!

Many thanks to Spiros Malandrakis – Senior Alcoholic Drinks Analyst at Euromonitor International for allowing me use the above graphs in this blog to illustrate my words past and future!

 

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