Global Wine Auctions Reach New High in 2011

A record amount of wine was sold, but the price per lot falls as the market plateaus
Jan 10, 2012

Worldwide auctions of fine and rare wine climbed to a record $478 million in 2011, up 17 percent from 2010, according to figures released by the major commercial auction houses. For the second year in a row, the major factor behind the increase was Hong Kong, where fine-wine sales rose 39 percent in value from US$165 million in 2010 to US$230 million in 2011.

In contrast, the U.S. auction total fell 5 percent from $154 million to $146 million. One of the reasons behind the dip was that many U.S. consignors elected to sell their collections in the Far East rather than domestically in the hope of achieving higher prices. In addition, prices for first-growth Bordeaux and their equivalents softened as the year progressed.

In the United States, 42,705 lots went on the block in 2011 compared to 46,037 in 2010. The average price per lot in 2011 was $3,428, down from $3,600 the previous year. Although the number of lots on offer in Hong Kong in 2011 rose to 27,818 from 17,000 in 2010, the average price per lot declined 15 percent from $9,700 to $8,227. In other words, auction fever subsided somewhat in 2011.

Over the course of 2011, Hong Kong collectors began to switch loyalties from classic Bordeaux to Burgundy. The iconic Château Lafite Rothschild 1982, which had skyrocketed to as much as $132,584 per dozen at Sotheby’s ex-château offering in October 2010, fell to $41,140 a case at Acker’s Hong Kong auction in December 2011. Several offerings of Lafite failed to find buyers—unthinkable a year ago.

Instead, rare Burgundies generated heated bidding. At Acker’s December 2011 Hong Kong auction, a 55-bottle “superlot” of DRC Romanée-Conti containing every vintage of Romanée-Conti from 1952 to 2007 (except for 1968, which was never released), brought a whopping $813,333 against an upper estimate of $300,000—making it the highest-priced lot of the year.

Jamie Ritchie, president of Sotheby’s wine, said the Hong Kong market is maturing very rapidly and buyers have become much more price sensitive. “I think sentiment has moved from ‘I will buy it at any price’ to ‘I will only buy it up to this price.’ It is important to remember that a lot of wine has been sold to Asian buyers and, while many did not have wine collections three years ago, they do now,” he said. “In all markets, demand for top-level Burgundy is strengthening, while the highest-priced wines from Bordeaux are coming back to more realistic levels. Going forward, I think we will see less wine coming onto the market, which is likely to stabilize pricing.”

Thanks largely to another spectacular performance in Hong Kong, Acker led the 2011 auction market with $110 million in worldwide sales, topping the record it set in 2010 for the highest total ever achieved by an individual auction house in a single year. It also held the record for highest single sale of 2011 ($US14.3 million) realized in Hong Kong last November. Sotheby’s and Christie’s were in a virtual dead heat at $85.4 million and $85.3 million in global sales, respectively (exclusive of Christie’s $7.4 million Hospices de Beaune auction, a charitable event conducted in Burgundy).

Chicago’s Hart Davis Hart topped the domestic front with $37 million in sales, followed by Zachys at $32 million. Six of Hart Davis Hart’s seven auctions were 100 percent sold, and the firm also held title to the highest U.S. single sale of $6.4 million, achieved last May. Heritage Wine Auctions, a subsidiary of Heritage Auctions, the third largest global auction firm, grossed $12 million in live and Internet sales in its first year of business auctioning fine and rare wine. In other auction news, the boutique firm of Edward Roberts International was sold to Acker Merrall & Condit, giving the latter a new base in Chicago.

Although bidders became more cautious as the year progressed, “superlots” containing rare vintages proved an exception. At Christie’s Hong Kong, a 25-case vertical of Château Lafite spanning vintages from 1981 to 2005 sold in September to a private Chinese collector for US$539,280, near the high end of the estimate. At Zachys Hong Kong in September, a 10-case parcel of Château Lafite Rothschild 2008 sold for US$17,316 per dozen, exceeding the presale high estimate. At Acker’s December auction in Hong Kong, another “superlot” containing 101 vintages of Château Mouton-Rothschild, including the ultra-scarce 1867, sold for US$500,513 against an estimate of $200,000 to $300,000.

Single-owner sales generally fetch a sizable premium because the provenance and condition of the collection are pristine, and the offerings are hard to come by. 2011 was no exception. A 14,000-bottle offering from the cellars of Don Stott—a former Wall Street specialist who amassed a huge array of prized Burgundies from Romanée-Conti, Jayer, Rousseau, Dujac and Roumier—tipped the scales at Acker’s November Hong Kong auction. In October, Zachys brought in $3.1 million for a 5,000-bottle collection of Burgundy belonging to a private American collector; it exceeded the presale high estimate, as did a 620-lot consignment from Dr. Robert Caine, a prominent Fredericksburg, Va.-based collector, that in February fetched $3.5 million, 26 percent above the high estimate.

Acker CEO John Kapon expects 2012 to be another excellent year at auction. “The fundamental forces of global demand for a small number of great wine estates and producers—wines made in finite amounts—have not changed as we finish 2011.” Paul Hart, president of Hart Davis Hart, notes that young collectors and seasoned bidders who had stepped back from the auction arena have come back into the fold. “At our last sale in December 2011, there weren’t enough chairs to accommodate the crowd!”

2011 year-end auction results.

Click here for a full-sized PDF version of this chart.

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