Category Archives: Wine Market

Jun 06 2012

Are Australia’s Top Cabernets Undervalued?

Posted on June 06, 2012 | By

In its promotional material for its Bin 707, Penfolds states that “Bin 707 is Penfolds’ Cabernet Sauvignon version of Grange: ripe, intensely-flavoured fruit; completing fermentation and maturation in new oak; fully expressing a Penfolds understanding of multi-vineyard, multi-region fruit sourcing.”

No-one can doubt the pedigree of Bin 707 or its status as one of the Australia’s benchmark wines. It is up there with Grange in the pantheon of Australia’s 17 most exceptional wines, as ranked by the Langton’s Classification of Australian Wine V – the form guide of Australia’s best performing and most prized wines.

But current prices of more recent vintages of Bin 707 are less than half the price of comparable vintages of Penfolds Grange. Current prices for other iconic cabernets like the Cullen Diana Madeline Cabernet Sauvignon Merlot, the Moss Wood Cabernet Sauvignon and the Mount Mary Vineyard Quintet Cabernets, for example, are all in the $100 to $200 price range, even though most of these wines are made in vastly smaller quantities than Grange and have almost equally impressive reputations for longevity.

But is the price discrepancy between top Australian cabernets and and their shiraz counterparts, which would also include acclaimed drops like Henschke Hill of Grace and Torbreck’s The Laird, warranted?

Certainly Australian cabernets are up against some stiff competition from overseas. Great Bordeaux cabernets like Château Margaux  and Château Lafite Rothschild are widely considered the greatest wines in the world. And in the New World, California’s reputation has largely been forged by international acclaim for a stellar line-up of cabernets from great producers like Harlan Estate, Bryant Family Vineyard and Shafer to name but a few. The top wines from all of these producers typically trade at much higher prices than comparable Australian cabernets.

For Australian shiraz the international … Read the rest

Aug 08 2011

Château Pétrus 1990: Is it worth the price?

Posted on August 08, 2011 | By

If you’ve recently scanned the Cellarit Wine Market you may have noticed that a bottle of 1990 Château Pétrus is available for $4,700. It’s not the most expensive bottle on the list. That honour belongs to a 375 ml 1952 Penfolds Grange signed by Max Schubert and available for $12,500. But nevertheless the price does seem extraordinary for an item that, after all, is designed to be eventually consumed! (Robert Parker of the Wine Advocate, who scored the 1990 Pétrus 100 points, gives a drinking window of 2014 – 2054, Wine Advocate # 183 June 2009.)

But a look at the price history of the wine clearly suggests that it is on an upward trajectory., which records wine auction prices, shows that the average price at auction for a Pétrus 1990 in 2003 was US$1250.98. 2011’s average auction price (42 lots to date have been sold) is US$4,095.35. That’s a 225% price appreciation in eight years.

As widely reported in the press, the Asian wine market is booming. Almost every Hong Kong wine auction sets a new record and mainland Chinese buyers, in particular, can’t seem to get their hands on enough quality Bordeaux. (see The Two Speed Wine Market, Cellarit Wine Blog, 19 October 2010).

Price appreciation for the Pétrus 1990, however, pre-dates the Asian boom of the last two years. Between 2003 and 2008 the price went up by approximately 188%. During the Global Financial Crisis (GFC), the price fell approximately 33 per cent before recovering and then eclipsing its pre-GFC highs – a performance that certainly looks better than most Blue Chip stock charts (especially in recent days)!

So why does this wine in particular command such high prices? We hear the terms ‘cult’ or ‘icon’ bandied around a lot in reviews or … Read the rest

Dec 12 2010

Artisans of the Barossa: Breaking down the Stereotypes!

Posted on December 12, 2010 | By

In my article, Australian and New Zealand Wine: Telling a Complex Story!, 28 September 2010, I mentioned that 12 of the country’s most prestigious wineries have joined forces to create Australia’s First Families of Wine (AFFW) – an export oriented venture designed to explain and promote the character, heritage and quality of Australia’s family-run wine companies.

In the Barossa region another group of like-minded winemakers formed their own alliance in 2006 with a similar purpose. Today, Artisans of the Barossa consists of 12 wineries that are working together to market their small production, hand-made, high quality wines to the domestic and international markets. Familiar and not-so-familiar names make up the group’s membership: Dutschke Wines, Hobbs of Barossa Ranges, John Duval Wines, Kalleske Wines, Massena, Radford Wines, Schwarz Wine Company, Sons of Eden, Spinifex Wines, The Standish Wine Company, Teusner and Tin Shed. Collectively they represent 11 Barossa subregions: Barossa Ranges, Lyndoch, Ebenezer Moppa, Kalimna, Bethany, Vine Vale, Light Pass, Koonunga and Marananga, as well as the Eden Valley.

What is also interesting about Artisans of the Barossa is that while the winemakers collectively have decades of winemaking experience behind them and share a rich viticultural heritage, most of the wineries in the group are less than 20 years old. Indeed, they represent a new generation of wineries that are dispelling the notion that Barossa is about massively extracted, high alcohol wines. As the American wine critic Alder Yarrow commented in his article, Tasting the Artisans of Barossa Wines, Vinography, 30 March 2010, “I was very happy to find many of them making 13.5% to 14% alcohol, elegant and delicious Shiraz (some from very old, microscopic family vineyards, and lean, low-alcohol Rieslings from the Eden valley).” Yarrow tasted … Read the rest

Oct 10 2010

A Few Aged Classics on the Cellarit Wine Market

Posted on October 10, 2010 | By

In a previous post, A Great Week for Wine Tasting! I mentioned that the Lebanese Chateau Masur is bottle aged for four years before being released!

Unfortunately the costs associated with holding back bottled stock for ageing is usually prohibitive for all but the makers of very expensive wine. Torbreck’s The Laird 2005, for example, spent two years in the bottle before release, and Penfolds Grange is released only after three years of bottle age.

But you only have to read the tasting notes of wine critics and winemakers to see that the peak drinking window for many of the finest red wines and some whites as well is often five, ten or even 20 years after release. Fortunately the secondary wine market offers an avenue for picking up cellared wines that are drinking at their best now.

Below are a few aged cabernet sauvignons from top Australian winemakers. Two of the wines have recently been tasted by our readers so I have also included their tasting notes.

Clarendon Hills Cabernet Sauvignon Hickinbotham Vineyard 2002 $69.90

“The 2002 Cabernet Sauvignon Hickinbotham Vineyard may be the finest Cabernet I have yet tasted from Clarendon Hills. While stunning from barrel, it is even more prodigious from bottle. An explosive bouquet of creme de cassis, melted licorice, new saddle leather, cedar, and Asian spices is followed by a full-bodied, marvelously concentrated effort that tastes like an Australian version of the profound 1990 Lynch Bages. Huge, concentrated flavors inundate the palate. The wine is seamlessly constructed with a brilliant integration of acidity, tannin, and wood. This fabulous, explosive Cabernet Sauvignon should be at its finest between 2008-2020+. Roman Bratasiuk is one of Planet Earth’s greatest winemakers, and obviously a top-notch viticulturist given his obsession with sourcing extraordinary fruit from ancient McLaren Vale vineyards.” … Read the rest

Oct 10 2010

The Two Speed Wine Market!

Posted on October 10, 2010 | By

For most Australian wine consumers the last few years have been a buyer’s heaven. The wine glut, increased competition from overseas, a high Australian dollar and the GFC have created a ‘perfect storm’ – leading to some of the best buying opportunities in decades!

So you may be surprised to hear that in Asia, and in particular Hong Kong and China, demand for wine is accelerating and prices, especially for first growth Bordeaux, are booming. William Lyons of The Wall Street Journal reported that the price of Chateau Lafite Rhothschild 2000 has climbed 611 per cent since December 2004.  A Bull Market for Wine: Top vintages have outperformed almost every other asset class over the past decade. How much longer can it last? The Wall Street Journal, 19 September 2010.

Recent Sotheby wine auctions in Hong Kong achieved 100 per cent clearance rates and more than 80 per cent of the lots sold for prices that exceeded high estimates. A 12-bottle case of Domaine de la Romanée-Conti 2005, for example, sold for US$232,962, equating to approximately $US19,413 per bottle! Sotheby’s Big Wine Haul by Amy Ma, The Wall Street Journal, 4 October 2010.

What’s fueling Asian demand for fine wine? Lyons says that Hong Kong’s decision to abolish all import duties and taxes on wine in 2008 is one of the reasons behind the boom. But as Shayne Heffernen explains in his very interesting article, China’s Emerging Wine Market, Live Trading News, 17 October 2010, over the past 10 years increasing cultural and business exchanges between Chinese and Westerners have for the time created a wine culture in China.

Today, affluent urban Chinese are associating wine with sophistication, vitality and high social status, according to Wu Jianhua, head of the Shanghai Drinks Association (SDA). Jenny Li, a Chinese wine … Read the rest