Wine investment: Rare whiskies lag while Tuscan giants hold steady

Rare whiskies were notable laggards among ‘passion’ investments tracked by global consultancy group Knight Frank in 2023, a new report has said. The Knight Frank Luxury Investment Index, tracking 10 collectibles including wine, cars, whisky and handbags, dipped 1% last year, said Knight Frank’s Wealth Report 2024, published in March.

Its sub-index for rare whisky bottles, compiled by the Rare Whisky 101 group, dropped 9%, although it has increased by 280% over the past 10 years.

Some whiskies in the index still rose in price last year, said the report, suggesting an uneven market performance. UK merchant Bordeaux Index reported rare whisky prices up 13% on average in 2023, versus a 12% drop in fine wine prices. Strong performers in Scotch included Springbank, Balvenie and Dalmore, as well as casks of Macallan, it said. More rare whisky price gains were likely in 2024, it added.

Knight Frank also surveyed more than 600 ‘private bankers, intermediaries, wealth advisers and family offices’ working with ultra high net worth individuals (UHNWI). When asked which passion investments were becoming more popular with clients, wine and whisky ranked third and fourth respectively, behind only art and classic cars.

‘Joy of ownership’ was the primary motive for ‘investments of passion’, and luxury collectibles made up 20% of UHNWI portfolios on average. Knight Frank also said the number of UHNWIs – those with a net worth of at least US$30m (£23.4m) – rose 4.2% globally last year.

New Super Tuscan releases

With top Super Tuscan and Brunello di Montalcino wines recently having hit the market, Decanter reports on the secondary market performance of these Italian vinous gems.

Newly released Sassicaia 2021 (99-points, Decanter) was the most traded wine by value on Liv-ex, a global marketplace for the trade, in the week ending 29 February. In March, Liv-ex quoted Sassicaia 2021’s market price at £3,300 (12x75cl in bond).

Data from Liv-ex suggests some top Italian wines have suffered less than other names on the fine wine secondary market in the past year. Liv-ex’s Italy 100 index fell 6% in 12 months to 29 February. Its parent index, the Liv-ex 1000, dropped 15%.

Super Tuscans have had a quieter year, said UK merchant Bordeaux Index, but its data showed average prices on four key names – Sassicaia, Tignanello, Solaia and Ornellaia – remained higher than in early 2020 (see chart, below).

That has narrowed the price gap to top Bordeaux, said Matthew O’Connell, CEO of Bordeaux Index’s LiveTrade platform. He added Tuscany may be better-placed than Bordeaux in 2024. ‘Trading in Bordeaux is still pretty subdued and I think that’s less the case for Super Tuscans,’ he said.

Brunello di Montalcino: One to watch?

According to several merchants, recent Brunello di Montalcino 2019 releases have enthused buyers, but this famous Tuscan enclave still has a minor secondary market presence.

Charles Antin, auctioneer and head of wine auction sales at US-based Zachys, said: ‘Most producers don’t have very significant resale value – they simply taste better in the glass than they perform on the [auction] block.

‘That said, Soldera and, to a slightly lesser extent, Biondi-Santi and Poggio di Sotto have very aggressive fan bases and do quite well in our auctions.’

Zachys sold 553 lots of Brunello for a total US$385,000 (£300,000) from 84 producers in 2023, excluding Soldera wines bottled as Toscana IGP (it left the Brunello DOCG after vintage 2006).

O’Connell said Bordeaux Index sees significant collector interest in Brunello di Montalcino, given its attractive quality-to-price ratio, but it’s hard to predict whether secondary market trading activity will increase. ‘It is a region that has the potential to do it.’

The Bordeaux Index view

Fine wine & spirits specialist Bordeaux Index kindly sponsors this section of Decanter, and provides its view on the market here every issue. It can be found at bordeauxindex.com.

Super Tuscans were one of the key beneficiaries of the 2021/2022 wine market strength, substantially altering their price context.

The significance of brand was core to this period and Super Tuscans tick that box perfectly in particular, with a small group of wines all of which have very high recognition beyond the collecting community.

In 2023, SuperTuscans did see a fall in market prices, though this was more modest than experienced by other regions. Market demand remained reasonably strong, aided by the low availability of stock.

Looking forward, we have broadly been of the view that compared to, for example, top Bordeaux, relative value of the SuperTuscans was strained and therefore their ongoing

momentum might be hampered.

However, given the argument that Bordeaux’s prices remaining static seems to be due to Bordeaux-specific factors, we wonder if Super Tuscans may surprise to the upside in 2024.

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