2011 has seen the wines from the Domaine Romanée-Conti stable rise 31.45% across the board. The top performer was Romanée-Conti itself with an average growth, across 20 vintages from 1985 to 2008, of 41.91%, the best performers were 1985 with +130.41% and 1990 with +111%.
In the IG Wines November Burgundy report we recommended DRC as a Buy due to the scarcity of supply and the increasing international demand. We believe all DRC names are still a very good buy. Other top Burgundian producers such as Rousseau and Leroy are worth keeping an eye on with great potential upside in 2012.
Chateau d’Yquem has seen the highest trading volumes in its history on the Liv-ex exchange. Since our blog in July Ch. Yquem gained 4% and we believe there is a lot of room for upside in 2012. The top mover, Yquem 2001 up 16.40% in 2011.
After 3 years of constant growth, the market saw an abrupt but healthy correction last year, with some first growths dropping as much as 45% .
The market saw a similar pull back in 1999 and in 2008 and in both cases December marked the low point and followed with 3 years of incredible growth.
A survey carried out by Liv-ex suggests that European buyers, who traditionally represent the low end of the market in terms of prices, now consider First Growth wines priced at the £250-300 level as attractive for consumption, some great quality wines are already at this level. With India set to dramatically reduce their import duty on wine and China rumoring a strong return there are great buying opportunities that should not be missed.Pétrus remained stable with a +2.61% increase and offering a safe haven.
‘Super Seconds’ over recent months have performed rather well with an average growth during 2011 of 11.6% taking into account 14 vintages from 1995 to 2009.
Top movers were:
Pichon Baron with a 20.4% average growth and Pontet Canet with average growth of 19.5% closely followed by Leoville Poyferre with a 16% growth.
Robert Parker recently held his Magical 20 tasting in Hong Kong, many of the featured ‘Super Seconds’ owned by our clients were included such as Leoville Las Cases, Cos d’Estournel and Pontet Canet. It seems the wider world agrees with Robert Parker and value wines of outstanding quality are being sought out in these times of economic uncertainty providing some very good upside opportunity.
Despite a big correction, there have been many good opportunities in the market this year, trends are changing faster than ever, and we’ve seen a broadening of the investment grade wines universe. Burgundy has seen dramatic increases and we are keeping a careful eye on Super Tuscans as their popularity continues to increase.
The beginning of 2012 offers some great buying opportunities of rare fine wines. This broadening market makes the selection of not only the Chateau but also the vintage more and more difficult and important.