Wine lovers pop their corks as rare vintages beat the recession
REBECCA McQUILLAN
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8 Jul 2009
A room in a warehouse in Glasgow was transformed yesterday into a paradise of wine � its shelves stuffed with vintage Pomerol, Haut Brion and Amarone, for Scotland�s biggest fine wine auction.
It was the wine-lover's equivalent of Aladdin's cave. A room in a warehouse in Glasgow was transformed yesterday into a paradise of wine - its shelves stuffed with vintage Pomerol, Haut Brion and Amarone, for Scotland's biggest fine wine auction.
More than 2000 wines went under the hammer at McTear's auction house last night, ranging from bottles for drinking now with a starting price of £80 for 12, to six bottles of Le Pin Pomerol 1985 for at least £1000 each.
The price of the rare and vintage bottles reflects fine wine's status as an investment - one that is starting to recover from the effects of the economic downturn.
At McTear's yesterday, yards of shelving lined the room, each shelf three or four deep with wines dating back to 1968 from the cellar of one Glasgow businessman.
Prospective buyers stepped around crystal chandeliers and paintings on easels - being auctioned by the same vendor - to browse the vast collection which included covetable clarets and Italian reds - many with faded and yellowing labels.
A 1977 Amarone stood next to a 1978 Barolo, and a 1986 Vosne-Romanee, expected to fetch £1000 or more, stood above a bottle of 1978 Cristal champagne.
But alongside the vintage classics were a few surprises, reflecting the individuality of the collection. A 1982 Chateau Haut Brion rubbed shoulders with a 1983 Blue Nun, while vintage Chablis shared shelf space with a bottle of red Le Piat d'Or.
Fine wine is an investment commodity with its own equivalent of the stock exchange - the Liv-ex (London International Vintners Exchange).
Liv-ex is an index of the price movements of the 100 most sought-after wines.
James Miles, a director of the company, said that in June, the index was 19% down year on year, but was up by 4.6% since the end of December.
He said the markets for fine wine had changed over the last five years: "Traditionally, it's been northern Europe and Anglo Saxon markets who have been the main customers for Bordeaux/claret.
"But that's changed. The Far East has become particularly important, China and the newly rich in Asia.
"Where typically 60% of the market would be UK/US in the past, that's now probably 60% UK/Asian markets.
"The other big new source of demand has been investment funds. In the last 10 years, the internet and businesses like Liv-ex have made the market much more transparent than it was before.
"It has also allowed people to quantify the returns available. It has long been suspected that wine was a good investment, but because it's been an opaque market, investors have been unable to quantify that, but we've been able to demonstrate that it performs strongly. Against that very big change in the demand dynamic for wine, you've also got a situation where supplies are shrinking.
"Top Bordeaux chateaux are becoming quality conscious, so if anything, they are making less wine. So prices are likely to go up.
"What we've found is that wine is not correlated to equities or property or things like gold. So it has unique characteristics which make it an interesting diversification tool in a portfolio.
"I don't think anyone is suggesting that wine should make up the bulk of your pension, but there is a case for having a small amount of your investment in wine."
Tom Bruce Gardyne, The Herald's wine critic, said that although it was possible to make "spectacular" gains on a well chosen case, anyone considering buying wine as an investment would be competing against expert brokers.
Andrew Bell, McTear's whisky and wine valuer, advised that to make good investments in either whisky or wine required "patience and passion".
Sealed cases that had never been opened and had been stored correctly offered the best returns.
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