Fine Whisky & Wine, What is going on?!

October 23, 2018

The fine wine and spirits market has been increasingly strong over the past 18 months. Record sales and auctions have seemingly occurred monthly during the auction season, offering opportunities to both enter and exit the market with good chances of success. 

There is no better illustration than the Macallan brand and the recent Sotheby’s Joseph Drouhin sale. Whisky has seen a surge not only in value, but also in visibility as the 1926 and other top Whisky brands continue to break records. Since April 2018, six bottles of the 1926 Macallan have come to market selling for a total of $5,257,000, or approximately an astounding $875,000 per bottle.

 

Macallan has used its prestige and powerful brand to establish records and drive the whisky market.  The 1926 Macallan had a total of 40 bottles released mainly as corporate gifts, 12 with Sir Peter Blake labels, 12 with Valerio Adami labels and the remaining 16 being either plain or unique.  Christie's is offering a one of a kind hand painted bottle by artist Michael Dillon coming in November, with estimates up to $1.3 million, perhaps breaking yet another record.   These bottles have become a truly rare offering that have transcended a bottle of liquid to become true collectibles.  The previous bottle was sold in 2007 by Christi'es for $54,000, which seems like a bargain with an almost 2000% increase over 11 years or 175% per year.  The Macallan Six Pillars collection focuses on the six pillars of the Macallan distillery, releasing beautiful Lalique crystal decanters over an 11 year period and a current estimated value of $700,000 for the set.  The 1965 was the final bottle with a release price of $35,000 in 2016.  It now sells for well over $80,000.

 

Similarly, 2 bottles of Domaine de la Romanee Conti 1945 sold at an October Sotheby's auction for a total of $1,054,000, a record for any single bottle of wine.  The 1945 DRC is somewhat of a unicorn as only 600 bottles were produced and infamously the most 'faked' with over 40,000 purported to have been drunk!  The 1945 marked the end of WWII as well as the last vintage before the phylloxera ravaged roots were ripped out, creating a truly mythical wine.  The bottles were part of a Joseph Drouhin sale that saw $7.3 million realized, over 5 times the high estimate, which reinforces the importance of great provenance.  The first half of the year has seen nearly $200 million in auction sales with 38% growth among the top four houses.  The UK has seen an amazing 76% increase in Whisky sales at auction with $32.5 million in sales and 100,000 bottles traded, nearly double that of 3 years ago.  

 

This is a unique time where both wine and spirits are seeing surges in record breaking sales, quality in offerings and rarity in the market.  These sales have been driven by great provenance as frauds and fakes still plague the market, but auction houses and top retailers have come a long way in ensuring authenticity.  As prices continue to rise, better and better product is coming to market. For collectors this is both a buy and a sell opportunity where deals can be had with wines that are still struggling to return to pre-2011 numbers, strong recent vintages and whiskies that offer entry level pricing.  Invest in right bank 2015 Bordeaux, entry level whisky from great brands like Highland Park, Brora and Port Ellen and Japanese Whisky with good value like the Nikka 12.  Those that have held onto collections are in the enviable position of seeing strong returns at market and can sell off pieces to re-invest and diversify their holdings.  This is the time to take advantage and work with the market.  Worst case, you still get to drink it!

 

 

 

 

 

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