Reversing a two-year trend of declines, the fine-wine auction market saw a small upturn in 2014, as global sales rose 4.5 percent—from $337 million in 2013 to $352 million—according to figures released by the major commercial auction houses. “The market got a little stronger in 2014,” observed Hart Davis Hart chairman Paul Hart, with measured enthusiasm.
The year was remarkable for the strong performance of United States auctions, which surged, while Hong Kong sales totals declined from last year. Also notable was Burgundy’s unseating of Bordeaux in terms of overall market share.
“Burgundy continues to be a focus of the marketplace,” noted Michael Jessen, Wally’s CEO. “Due to the rapid increase in collectors interested in the great wines of Burgundy, the elevated prices of these wines was the story of 2014.”
In 2014, U.S. sales totals increased by 26 percent, from $126 million last year to $159 million this year. Contributing to those revenues was the $11 million, two-part sale at Wally’s of uber-collector Roy Welland’s wines. A slightly weaker demand among buyers in Asia softened Hong Kong auction totals by 7 percent. (All figures are given in U.S. dollars. Christie’s numbers are provisional.)
The average price per lot in the U.S. in 2014 rose to $2,877 from $2,689 in 2013. Conversely, Hong Kong saw a drop from $6,301 last year to $5,935 this year. Yet demand for collectible wine remained strong on both continents, evidenced by healthy sell-through rates of 96 percent in the U.S. and 94 percent in Hong Kong—roughly the same levels as in the previous year.
“Demand from the different regions of the world has evened out, with both North America and Latin America playing a stronger role,” said Jamie Ritchie, CEO of Sotheby’s Wine. “The austerity measures in Mainland China have impacted the market, but we are still seeing consistent demand from Asia—more consistency and less volatility so far.”
With $65 million in sales, Sotheby’s led the 2014 global auction market, followed by Acker Merrall & Condit at $62 million and Christie’s at $53 million (excluding the $9.8 million Hospices de Beaune auction in Burgundy, conducted by Christie's).
For the fourth year in a row, Hart Davis Hart led the U.S. auction market with $42.8 million in revenue—a 36 percent gain over 2013. The firm also laid claim to the year's highest-grossing single domestic auction, in May, netting $8 million.
In Hong Kong, Acker Merrall & Condit led the pack, with $29 million in overall sales.
Domestically, Burgundy has surpassed Bordeaux in market share at Zachys live auctions, said auction director Jamie Pollack. “In 2014, Burgundy accounted for 41 percent of total market share versus 33 percent in 2013. In Hong Kong, Burgundy accounted for 52 percent of total sales in 2014 compared to 40 percent in 2013,” Pollack said.
Acker Merrall & Condit CEO John Kapon, who registered similar results, quipped, “Bordeaux might have to get used to the taste of the silver medal as opposed to the silver spoon.”
Domaine de la Romanée-Conti remains the most sought-after Burgundy producer at auction. At Sotheby’s November sale in Hong Kong, a 114-bottle superlot, consisting of six bottles each of DRC Romanée-Conti vintages from 1992 to 2010, sold for a whopping $1.6 million.
Heated Burgundy bidding was not limited to DRC labels, however. A six-bottle case of Henri Jayer Vosne-Romanée Cros Parantoux 1985 fetched $101,575 last February at Hart Davis Hart, a 112 percent increase over the auction index average. Other highlights included Armand Rousseau Chambertin 1997, which averaged $1,140 per bottle at Wally’s, up 112 percent. A six-bottle lot of Chambolle-Musigny Les Amoureuses 1978, consigned directly from the cellars of Joseph Drouhin, was up a hefty 244 percent when it sold for $13,475 at Sotheby’s in March.
California cult wines continued to gain in market share across the board. At Wally’s last October, 24 lots of Harlan Estate, ranging in vintage from 1992 to 2010, sold for $127,440 over a high estimate of $79,900. Similarly, 26 lots of Screaming Eagle Cabernet Sauvignon back to 1992, valued up to $303,700, brought $384,720. Six magnums of Schrader Cabernet Sauvignon Old Sparky 2007 fetched $22,230 at Acker in June, a gain of 69 percent. Sine Qua Non enjoyed a particularly strong following: At Sotheby’s last December, four bottles of Sine Qua Non Crossed 1997, with a high estimate of $1,100, sold for an astonishing $42,875.Will Bordeaux make a comeback in 2015? In the aftermath of his successful Bordeaux auction last November—in which three château-direct consignments brought in a total of $350,016—Hart thinks so. “The image of Bordeaux as something your father or grandfather drank needs upgrading,” he said. “We’re seeing exciting new approaches to winemaking particularly at châteaus such as Pontet-Canet, Pichon Lalande, Cheval-Blanc and Montrose. They will energize the market.”
The extravagantly priced 2009s and 2010s from Bordeaux have been delivered, and collectors will be able to judge whether they got their money’s worth. “They will see that these are truly great wines, and will want to have more of them in their cellars,” Ritchie predicted. “So over the next few years, we should see demand coming back and prices firming up. At the same time, mature Bordeaux that is ready to drink will become rarer and more expensive, creating a premium over the younger wines. When this happens, demand for the younger wines will improve.”
“I think 2015 will be another vintage year for the wine market,” said Kapon. “The top labels have become luxury goods, and there are only so many that are considered elite, and deservedly so. When a few people absolutely have to have something, and that something is very limited, prices can surge.”
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