This article first appeared in Financial Times.
Wine investment appears to be back in the minds of high-end consumers, but they have been turning away from France in favour of Italy. Top names in Italy such as Brunello and Barolo have been usurping the long-established estates of Bordeaux or hard-to-find Burgundies.
“For the past six to 12 months, the words ‘wine investment’ have resurfaced, and I believe the collapse of prices for blue-chip wines with the weakening of the euro are getting people excited about wine again,” says Paulo Pong, managing director of the Altaya Group, a wine merchant in Hong Kong with almost a dozen wine shops.
“Things like Brunello 2010 are our hot picks. They rank as some of the best ever produced in their respective regions.”
Indeed, the 2010 Brunello di Montalcinos were the best wines ever produced in Italy’s famous region of Tuscany. These bold reds are produced using only the Italian sangiovese grape and aged for five years before release. The 2010 vintage produced reds that are rich and powerful, yet fresh and refined owing to a longer than usual grape-growing season.
“2010 was a stellar year for Brunello di Montalcino, with most estates producing their best wines ever,” says Gary Boom, managing director of London based Bordeaux Index, a fine wine merchant with clients worldwide. “Again, we had enormous demand here and sold over 20,000 bottles across various producers.”
I rated almost 400 different 2010 Brunellos over the past 12 months. Some are regular bottlings that are on the market and others are riserva and single vineyard reds that will be released in January 2016. So many of the wines are superb quality. That is why I gave the following wines perfect ratings (100 points) including: Luce della Vite, Livio Sassetti, Siro Pacenti, Le Ragnaie VV, San Polino Helichrysum, Casanova di Neri Cerretalto, Assunto Riserva, Ciacci Piccolomini d’Aragona, Pianrosso Santa Caterina d’Oro Riserva, Renieri Riserva, San Filippo Le Lucére Riserva, and Valdicava Madonna del Piano Riserva.
“Brunello 2010 has been spectacularly successful,” says Simon Brewster, senior private client sales manager at Fine & Rare Wines in London. “A great vintage, it has been backed by the critics across the board and comes from a region that’s easy to understand. More importantly, prices are reasonable and offer fantastic value for money.”
Reasonable pricing compared to other top collectibles, however, suggests that Brunello may not be the best wine investment from Italy. Super Tuscan wines such as Sassicaia, Masseto, Ornellaia, Tignanello, and Solaia are traded in greater volume on the secondary market and have a history of better price appreciation.
Anthony Maxwell, director of Liv-ex, the online wine trading platform in London, says: “Super Tuscans, which accounted for 75 per cent of Italian trade on Liv-ex over the past year, attract the most secondary market activity.
“They are producing large volumes — similar to Bordeaux classified growths — and while Bordeaux has been out of favour, they have looked attractive.”
Xavier Hornblow, manager of the Jeroboams flagship store in Belgravia, thinks Italy’s novelty may have been working in its favour. “The UK wine investor is characteristically well educated on the wines of Bordeaux, Burgundy and Champagne,” he says. “So, with its plethora of artisanal producers, Italy feels like relatively undiscovered territory. It has captured peoples’ imagination.”
Key wine merchants concur that Barolo wines from the Piedmont region is another Italian wine category not to overlook at the moment. “Piedmont is the Burgundy of Italy,” says Greg St Clair, Italian wine buyer for K&L Wine Merchants in San Francisco and Los Angeles. “You need to know more, so the wines are generally for very savvy consumers.”
But that is part of the interest for consumers with all Italian wines. “I have been buying Burgundy and Bordeaux for years,” says London-based private equity manager Philip Renaud and an active wine collector. “But Italy is fascinating, especially Super Tuscans, Brunellos and Barolos. And you can drink most of them on release.”
Barolo has had a string of excellent vintages, most recently 2011, 2010, 2008 and 2007. Sought-after producers include Giacomo Conterno, Roberto Voerzio, Bruno Giacosa and Aldo Conterno. Production can be small for these producers because most make single vineyard bottlings similar to Burgundy. Some may only number 200 or 300 cases.
Perhaps some of the current interest in Barolo is spurred from the disappointment in rare Burgundy. This is particularly so in Hong Kong, where the top wine collectors and investors are obsessed with Burgundy. The frustration is not because of the quality. The best producers of Burgundy, both white and red, make excellent wines even in such difficult vintages such as 2013.
However, many of the most collectable wines are very difficult to find and what is available can be extremely expensive. Prices seem always to be on the increase.
“Burgundy has all the necessary requirements: rarity, immense quality and a touch of romance,” adds Fine & Rare Wine’s Mr Brewster. “Demand will always outstrip supply for the best on release and you’d expect this to be heightened further as the wines become scarcer and more desirable as they mature. That said, where the upsides will be is harder to predict as the volumes traded are so low.” 
The big question for 2016 is whether demand for fine Italian wines will continue. Improved quality and collectability are not the only factors driving new interest in Italy from the wine trade and consumers. Italy has also been the beneficiary of a string of disappointing years in Bordeaux that has sent wine buyers looking for pastures new.
“Whenever vintages in Bordeaux are not terribly exciting, people seem to look elsewhere,” says Patricio de la Fuente Saez, managing director of Links Concept, the Hong Kong-based wine merchants. “Italy has embraced the international wine tastes . . . wines such as Tignanello and Solaia are not expensive compared to similar quality wines from other countries. They age fantastically and will always appreciate in value ahead of the demand.”
This love affair with Italy, however, might all change next year. The 2015 vintage is expected to be outstanding in Bordeaux and it has been five years since the global market welcomed a young vintage from France’s premier wine region.
“Bordeaux looks prime for a comeback,” concludes Liv-ex’s Mr Maxwell. “There is potentially a top en primeur [futures market] vintage in the pipeline with the 2015, which traditionally boosts the wider Bordeaux market and brings interest and focus back to Bordeaux — if the price is right.”
Photos from top to bottom: A range of 2010 Brunello Riservas; James tasted hundreds of 2010 Brunellos in Italy; Altesino Brunello di Montalcino 2010; A cork of Giacomo Conterno Barolo Francia; Azienda Agricola Cogno Barolo Bricco Pernice 2010
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