Every month, Angélique de Lencquesaing presents the latest trends in fine wine auctions on the BFM Business channel. Here she was interviewed by Cédric Decoeur.
With the spread of new variants, it’s clear that the Covid crisis is persisting, along with all the effects this will have on the economy, on business, on e-commerce…Let’s have a look at the specific world of the fine wine auction market as the first quarter of 2021 comes to a close. The trends you spot are useful for people putting together an investment cellar.
Absolutely, and we’re currently adding the finishing touches to our Barometer, a publication that review all of the developments in the fine wine market, this time laying out all the details of what happened in 2020. A solid and precious base for considering emerging trends and outlooks for the coming year.
From lockdown to curfew, the global health crisis has, conversely, brought a huge boost for e-commerce. Have you also seen this in iDealwine’s online auctions?
The world of auctions is indeed a rather specific one, in that most of those who sell their wine through us are not producers, but private consumers who, for one reason or another, have had to part with some or all of the contents of their cellar. Of course, the past year has hugely restricted the possibility to move around. In 2020, the two months of spring lockdown totally prevented us from picking up bottles from cellars and sellers from dropping off their wine at our warehouse. Sourcing became quite a challenge. On the other hand, buyers were clearly very keen to get their hands on top wines.
So that was 2020. Has this continued into 2021?
We were able to put extra health and safety measures in place to make sourcing possible from the summer of last year. This means that sellers have been able to put their bottles up for auction much more easily once more, thus we closed 2020 with a 4% increase in volume auctioned (+9% in value). A lesser progression than what we had hoped for, but progress nonetheless.
Since the start of 2021, the volume of wine sold at auction has increased by 15%. It’s actually the classic, fixed price part of our activity that has grown significantly, increasing by 55% in volume and 85% in value compared to the first quarter of 2020.
Are clients buying wine to drink now or as an investment?
Both! And these aren’t mutually exclusive buying patterns. As soon as you start buying great wine that you hope to drink one day, you’re on your way to building an excellent collection.
Considering the average price per bottle of the wines sold at fixed price (that is, outside of auctions), this has increased to €50 since the beginning of the year. At auction, this figure is much higher at €104 for a classic auction, and reaching an average as impressive as €300 for the sale of a whole private collection in March!
Don’t these higher auction prices hamper buyers?
Quite the opposite! I should clarify that this average bottle price of €104 – an average that shifts from one sale to the next – is lower than the figure for the whole of the year 2020. It settled at €134.
Is this lower average price the sign that clients are losing interest?
No, prices are actually stable for the top domains, and increasing for certain up-and-coming estates. The drop in average bottle price is more to do with the typology of the wines put up for auction.
The fine wine market is very dynamic at the moment. What’s striking is the success of fixed price bottles, as well as the fact that the percentage of lots sold at each auction continues to increase. Recently, 80-100% of the wines we put up for auction find a buyer. The private collection that we sold last month went for 30% more than its initial estimate across the whole cellar.
So you’re looking at a shortage of bottles to sell? What are consumers looking for at the moment?
It is clear now that no region has been spared the appetite of wine lovers. There is a question of whether people have been building up stocks during this phase of lockdown and curfew, but I think it’s more to do with the closure of restaurants and restrictions around travelling. This is what clients have been making up for.
Is it still possible to make a top 10 of the most coveted wines of the moment? What are the big names in each region?
One wine by region is a bit tricky, but it all depends on your angle. In our Barometer we’ve explored the best-selling domains in terms of value and volume. Looking in depth at a whole year’s worth of sales results, there are some surprises worth considering!
Let’s begin with the classic trio of Burgundy, Bordeaux, and the Rhône
Yes, Bordeaux is still our best-selling region in terms of volume at auction (36% of sales), although Burgundy overtook in value for 2020.
Bordeaux’s trio of choice is made up of Petrus (in value), Mouton Rothschild (in volume sold), and Cheval Blanc for its progress in the top ranking. I also want to add Figeac, an estate that has been well-loved by clients for a long time and has had great success in recent years.
So it’s still worth investing in Bordeaux?
Of course, Bordeaux bottles are what we refer to as ‘père de famille’ investments, globally recognised names. Indeed, we’re waiting with baited breath for the 2020 vintage to be sold en primeur; we’ll talk about that another time but things are looking promising.
And is Burgundy still the heartthrob of the wine world?
Absolutely. Burgundy represented 37% of our auction sales in 2020 (in value), an indication that this is a good region to invest in.
In terms of the total value sold, Domaine de la Romanée-Conti dominates, even with just 443 bottles auctioned last year. At the same time, the supremacy of this domain is somewhat threatened by the performance of Domaine Leroy, our first place estate in terms of highest-priced bottle, with a 2001 Musigny selling for €17,499.
The revelation of the year has got to be Domaine Bizot from the Côte de Nuits, this estate has absolutely exploded at auction. It came onto our radar in 2020 and its ‘natural’ Echézeaux has skyrocketed! One of these sold just this week, a 2009 magnum that went under the hammer for €5,034 (+63% on its starting price).
Things look more stable in the Rhône…
It’s true that the top three in this region hasn’t altered. From Châteauneuf-du-Pape, Château Rayas is a winner in every sense, coming top for volume, value, and fondness. Jean-Louis Chave (Hermitage) surpassed 2,000 bottles sold which, considering the difficulty of getting hold of these wines, is a notable figure.
We can round off this top three with a regional institution, Guigal, which produces the famous Côte-Rôtie trio of La Mouline, La Landonne, and La Turque. I have to cite a fourth name, Domaine de l’Anglore (Tavel), which demonstrates all on its own how much success a small appellation can harbour. This natural domain came 5th in our ranking of best-selling properties, a stunning result!
For each of the other regions, perhaps give a classic name and a top domain that might surprise…
The Loire Valley?
Clos Rougeard for the classic name, and Les Jardins Esméraldins for a surprise success; both in Saumur.
Yvon Métras for the star, Mee Godard for absolute elegance.
Deiss for the number of bottles sold, and Bott-Geyl for excellence at an understated domain.
Grange des Pères is a legendary estate, and Mas Cal Demoura crafts incredibly delicate cuvées.
Selosse for the surprise name (we didn’t expect this one to come first!) and Roederer for its growth (going from 5th to 3rd place in the regional ranking).
Overnoy, which has taken first place from Ganevat, for the star name, and Domaine Les Granges Paquenesses for utmost rarity.
And from the south?
Trévallon for an institution, and Vacelli in Corsica for a bit of escapism.
How about Italy?
Rinaldi for the lacy profile of Piedmont wines, and Franck Cornelissen to explore Sicily.
And other non-French regions?
Vega Sicilia is a big name from Spain, and Marie-Thérèse Chappaz produces really exciting cuvées.
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