REASONS TO BE CHEERFUL:THE FINE WINE MARKET IN 2012

作者: Stuart George        来源: 《酒典》www.winemagcn.com|原创作品 谢绝转载

It was a funny old year. A Korean pop singer became a global phenomenon. Venus came very close to Jupiter. And the world did not end on 21st December, as some had blamed Mayans for predicting.

             

In the art auction world, 2012 was a banner year for trophy hunters, thanks to “The Scream,” Richter and Rothko. This November, auctions at Sotheby’s and Christie are brought in $787.3 million. All this amid a financial crisis.

             

But the sometimes astonishing prices did little to ease growing concerns that a price bubble was swelling, that the modern art market was becoming sickly, and that China’s once seemingly inexhaustible buying power was starting to turn lethargic. Sound familiar?

       

Take five

 

Munch’s tortured figure is probably how wine auctioneers looked when they added up their year-end figures. Total live auction sales by the big five of Acker Merrall & Condit, Christie’s, Hart Davis Hart, Sotheby’s and Zachys raised $334 million (with premiums) this year, down 21% from the record $405 million achieved in 2011.

 

Christie’s unconfirmed total was $90 million (including premiums of 15-21%), making it leader of the global fine wine auction market in 2012 and the only auction house to come close to matching the previous year’s total. Sotheby’s made $64,462,965 (with premiums of 17.5-22.5%), a decrease of 32.5% on 2011.

      

Of the US-based auction houses, Hart Davis Hart in Chicago raised $26,304,536 (including 19.5% premium), down 42%. Zachys reached $70,162,764 (including 21% premium), a decline of 12%, and Acker Merrall & Condit – which had the best sales figures in 2011 and 2010 – totalled $83,322,926 (including 23% premium), 32% below its record-breaking total of 2011. The slackening of the market was epitomised by Acker Merrall’s 6th-8th December Hong Kong sale, which was only 84% sold by lot and the company’s lowest clearance rate of the year.

       

Acker Merrall reported that 56% of its revenues came from Hong Kong auctions, compared to 2011’s 62%. Sotheby’s and Christie’s also sold more wine in Hong Kong than any other of their outlets, with London in second place and New York third. There was a time when New York ruled the wine auction world but it has been overtaken by Hong Kong and the money flooding into there from Mainland China. In London’s favour are its central time zone, user-friendly currency (the Euro remains perplexingly strong against the British pound, which is weak against the Chinese RMB and Hong Kong dollar) and buyer’s premiums – as much as six percentage points lower than in NYC or HK.   

       

Know your rights

 

The London-based online wine exchange Liv-ex, which has members in more than 30 countries on six continents, reported that five of its six major indices were down year on year. The worst performer was the Liv-ex Fine Wine 50, down 9.6% in 2012 and 24.7% since 2011. Generally the indices fell for the first six months of 2012 before perking up in the second half of the year.

       

The DRC Index reached a ten-year high in May but was down 0.9% for the year, suggesting that auction room hype for this domaine is not all that it seems. Domaine de la Romanée-Conti’s secondary market performance has been flat but it looks good because the First Growths have declined so much. The Bordeaux whirlpool has not disturbed the broader market’s flow.

     

The Right Bank 100 rose 4.6%. High scores, scarcity and, in the case of Châteaux Pavie and Angélus, an upgrade in the St-Émilion reclassification has stimulated interest in Libournais wines, which for many people now represent much better value than the Médoc Firsts.

 

The five-year figures for Liv-ex indices remain very sound and assert the long-term value of wine investment. The Second Wine 50 has gained 146.9% since 2007, the DRC Index 79.9%, the Right Bank 100 67.4%, the Super Tuscan Index 52.8% and the Fine Wine 50 22.8%. Over the same period the S&P 500 has lost 2.9% and the FTSE 100 is down by 8.7%. Every time we think that the world is about to end the wine market confounds the most pessimistic predictions. It has thoroughly outperformed stocks and shares over this difficult five-year period.

      

Lafite of clay

 

Lafite is still the most traded First Growth on Liv-ex even though its volume has almost halved since 2011. It accounted for 7.5% of Acker Merrall’s turnover and is still a hugely lucrative and significant wine brand, as indeed Cru Classé Bordeaux is as a whole. But DRC has become theAndy Warhol of the wine market – the one everybody wants above the mantelpiece.

       

DRC accounted for 17% of Acker Merrall’s turnover in 2012 and only two of Christie’s top ten lots were not Burgundy. The Hospices de Beauneraised a record total, doubtless helped by the presence of the lovely Mrs Sarkozy (whose currently unemployed husband is teetotal). Although the Hospices does not make the market in the way that “commercial” auctions in Hong Kong, London and New York do, it does give a good picture of current demand for Burgundy,which continues to attract ever more attention in Asia.

     

Liquid bubbles

 

Bordeaux still has the volume; Burgundy now has the prices. Jayer and DRC are the big beasts of the fine wine world but the tiny amounts available cannot sustain a fizzy secondary market for long. As the American economist Herbert Stein said, “If something cannot go on forever, it will stop.”

       

Paying wild sums for fine wine doesn’t necessarily signify a healthy market. High prices signify demand, nothing else. And demand, particularly in Asia, is a fickle thing. Is it a bubble or a new reality?

       

A bubble is defined by prices soaring in a short time – the price doubles within a few weeks or months – and there has to be widespread public participation, with plenty of news coverage and everybody talking about it. This clearly happened to Lafite 1982 in October 2010 when its price went from $59,350 to $132,700 at a Hong Kong auction. By the end of 2012 Lafite ’82 was typically selling at $29,000, where it was 18 months previously and before that five years ago. It’s very difficult to call the bottom of the market but Lafite is flat at the moment and any signs of life could be a “bull trap”, looking as though it’s going up in price but it will actually decline even further. The bubble hasn’t burst but it has certainly deflated.

       

It’s possible that Burgundy – and particularly DRC – could follow this model: hugely increased interest and prices, a sudden spike, and then a collapse back to pre-hype levels. Short-term speculators please note. Some wines will continue to fall in value; others will gain. That is the way of the free market.

      

Rudy awakening

 

The biggest fine wine story of 2012 wasRudy Kurniawan’s exposure as possibly the greatest wine fraudster of them all. In February 2012 there was huge controversy about a London wine sale conducted jointly by Spectrum Wine Auctions and Vanquish Wines. It was alleged that the consignor of many of the wines was Kurniawan. Rumours of Kurniawan’s re-emergence into the fine wine market led to close scrutiny of the catalogue. Doubts were cast about several wines and 13 lots were withdrawn after label and capsule discrepancies were pointed out.

    

For Kurniawan, who used to refer witheringly to traditional merchants as “dusties”, the game was nearly up. On 8th March, one month after the London auction, the FBI arrested Kurniawan in Los Angeles on five counts that included “Scheme to Defraud a Finance Company”, “Scheme to Defraud the Finance Company and a New York Auction House” and “Attempt to Sell Encumbered Wines at an International Auction House”. Here, for the first time, fine wine fraud on an industrial scale had been exposed – not just a few bottles but hundreds. By the end of the year Kurniawan was facing multiple fraud charges that could see him locked up for at least a decade.

   

And in other news

 

The old saying “when America sneezes, the world catch a cold” now seems to apply to China more than the USA – after all, Shanghai’s February air is notoriously flu-ridden. China’s economy grew at about 8% in 2012 (depending on which source is used), down from over 9% in 2011 but still well ahead of Western economies. The world will continue to look to China for financial inspiration.

       

There will be no Château d’Yquem or Château Rieussec2012 because of a difficult Sauternes vintage. Château Latour will no longer be offered en primeur but the market does not yet seem have to have been affected by this. However, Latour could become the most sought-after First Growth in 2013. Liv-ex has already noted an increase in Latour trading.

     

It’s a good time to go shopping for undervalued assets, and even more so if the exchange rate is in your favour. The last couple of years have been a seller’s market. Now it’s a buyer’s market. Warren Buffett advises, “The time of maximum pessimism is the best time to buy.” Bordeaux 2000 and 2005, once vaunted as the most expensive wines on the market, are now seen as relative bargains.

       

Back to the future

 

The world didn’t end on 21st December 2012 so there will be a future. Much of the work of the wine trade, like any other business, is about trying to forecast trends. But in an industry that is based so much on weather and on global economic conditions no outcomes can ever be guaranteed. Nonetheless, we can perhaps make some fairly random predictions for 2013 and beyond, based on what has happened in 2012 and before.

       

There is still a lot of stock in Hong Kong for merchants to sell. Private cellars are full to bursting: New collectors tend to stop buying when their cellar is full. This, more than anything else, has caused a depression of prices. If prices are to rise then less wine needs to come into the market. On that basis, predictions of a return to 2008 prices might be as optimistic as predicting a Romney landslide.

      

Asia will continue to be an important driver of demand into 2013. Interest is spreading into wines beyond the First Growths. Names to watch include Ducru-Beaucaillou, Pichon-Baron, Pichon-Lalande and Pontet-Canet. 

      

Importing wine into Mainland China will continue to be a challenge. Remember that this is the country that made a law stipulating that no public lavatory should have more than two flies. For wine merchants and other sellers of luxury goods, Xi Jinping’s “election” as leader of China was arguably more important than Barack Obama’s re-election as President of the United States. He has vowed to crackdown on corruption with an “iron fist”. This can only be a good thing. Dealing with Chinese wine bureaucracy at the moment is like being in a Kafka story.

       

Another expensive en primeur campaign would dent the Bordeaux brand in Asia. The 2009 campaign was the most expensive ever, 2010 ditto, and 2011 not discounted enough vis-à-vis the previous two vintages. The Bordelais – which is to say the First Growths – need to be sensible. Otherwise there’s always Burgundy for the high rollers to spend their money on.

 

Unlike the art market, in which trash by Damien Hirst and other charlatans sells for millions, the best wines always find their way to the top of the pile. The wine market is better informed and more sensible than the art market. DRC is in demand because it’s a great wine estate. Chilean Pinot Noir doesn’t have the same cachet.

        

A constant supply of sellable products is the biggest challenge for wine auctioneers.As the year went by more and more emails were sent out offering free appraisals and reminding clients that it’s not too late to put your wines into the next auction. This suggests a bear market in which potential clients are keeping their cellars locked and waiting for the good times to return. A Barclays survey called “Profit or Pleasure? Exploring the Motivations Behind Treasure Trends” showed that once millionaires own a precious object they will only sell it at a vast profit. For the rest of us it’s a good time to stock up.

      

Lucky 13?

The age of gluttony might be over but there is more cause than ever, during these gloomy times, to break bread and open bottles with family, friends and neighbours. How about an anniversary bottle?

       

The sun-drenched 2003 vintage produced, for some, atypically ripe and alcoholic Bordeaux and Burgundy; others (mainly in the USA) consider these to be great wines. A ten-year retrospective should be fascinating.

       

Excellent white Burgundy was made in 1995 – but beware of oxidation. Some very good stuff was made in Germany and Burgundy in 1993 but Bordeaux was underwhelming. The rain-sodden 1992 vintage in Bordeaux was awful. Better to celebrate 21st birthdays with Burgundy or Champagne.

 

Châteaux Margaux and Palmer made one of their best ever wines in 1983, which was also a great Sauternes vintage. Rhône, white Burgundy, Port, Penfolds Grange, sweet Alsace and Tokaji are fine.

      

Forget France in 1973. German Eiswein was good, though. Stories abound of mould growing inside fermenting vats during the 1963 Bordeaux vintage. Happily, 50-year olds can enjoy some magnificent Vintage Ports. Sixty-year olds get to open lovely Bordeaux.

       

The best of the wartime vintages was 1943, which is not saying much. Burgundy was good in 1933 and Lafite was the exception to an otherwise light vintage. Any 90-year old with their original teeth will find wines of the 1923 vintage to be of moderate quality. Centenarians are to be pitied: it was a dreadful year.

       

          AUCTION TOTALS 2012-2007(All totals include premiums)

                     2007            2008            2009

          Acker Merrall & Condit     $59,860,000      $59,783,368      $44,212,698

          Christie’s                     $71,647,944      $50,665,602      $50,444,401

          Hart Davis Hart               $26,920,140     $32,273,540      $24,008,542

          Sotheby’s                   $49,287,329      $44,625,346      $41,755,284

          Zachys                 $52,445,415      $29,840,000     $50,733,970

 

                             2010         2011             2012

          Acker Merrall & Condit     $98,495,056      $110,454,801 $83,322,926

          Christie’s                     $71,500,000      $92,672,909     $90,000,000

          Hart Davis Hart               $39,160,000     $37,425,857     $26,304,536

          Sotheby’s                    $88,270,602      $85,467,096     $64,462,965

          Zachys                  $56,510,000      $78,969,614     $70,162,764

               *Unconfirmed total

 

            HIGHEST LOT PRICES IN 2012

            DRC Superlot: Eight vintages of DRC Assortments (’97, ’98, ’99, ’00, ’01, ’04, ’05 and ’06 – 96 bottles)

            Estimate HK$2,240,000-2,800,000

            Hammer price HK$2,195,120 (US$280,000)

            Acker Merrall & Condit Hong Kong, 8th December 2012

 

           Henri Jayer Vosne-Romanée Premier Cru Cros Parantoux 1985 (12 bottles)

           Estimate HK$800,000-1,000,000

           Hammer price HK$1,700,000 (US$219,130)

           Christie’s Hong Kong, 10th February 2012

 

           Château d'Yquem 1900-2000 (92 bottles)

           Estimate CHF150,000-200,000

           Hammer price CHF200,000 (US$ 212,025)

           Christie’s Geneva, 14thNovember 2012

                                                                         

           Henri Jayer Vosne-Romanée Premier Cru Cros Parantoux 1989 (12 Bottles)   

           Estimate HK$380,000-480,000

           Hammer price HK$1,500,000 (US$ 193,350)

           Christie’s Hong Kong, 10th February 2012

                      

           Henri Jayer Richebourg Grand Cru 1979 (12 Bottles)

           Estimate HK$600,000-800,000

           Hammer price HK$1,500,000 (US$ 193,350)

           Christie’s Hong Kong, 10th February 2012

 

作者简介:斯图亚特·乔治,已从事酿酒业十四年,走遍了欧洲酿酒区,并到访南非、澳大利亚、新西兰、巴西等地的酿酒区。2003年,他被评为“英国年度年轻葡萄酒作家”,是畅销书《1001瓶你死之前必喝的酒》的作者之一。

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