From a Winevestor perspective there is only one game in town when it comes to investing in Sauternes. Chateau d’Yquem was the only Premier Cru Supérieur in the 1855 classification and its supremacy remains today. D’Yquem may be the longest-lived wine on the planet, has an incomparable brand, has a 300 year track record and consistently has high scores from the critics. It is also created sparingly (a grape at a time) and typically 10,000 cases are produced each year. This is approximately half the amount of the First Growths and remember there is only one d’Yquem, whereas there are five first growths.
D’Yquem has a long history. Wine was first produced on the site at the start of eighteenth century. It has been in the Lur-Saluces family since 1785. Thomas Jefferson wrote “Sauterne. This is the best white wine of France and the best of it is made by Monsieur de Lur-Saluces.” He purchased the wine for himself (if you want a great summer page turner book read ‘Billionaire’s Vinegar’ by Benjamin Wallace) and for George Washington. Some have labeled the 1811 (the year of the comet) d’Yquem as the best wine of all time!
Since 1996 Chateau d’Yquem has been owned by the French Luxury goods company Louis Vuitton Moet Hennessy (LVMH) after bitter family wrangling within the Lur-Saluces family caused the sale. In 2004, Comte Alexandre de Lur-Saluces retired completely from the estate and was replaced by Pierre Lurton, who also runs Chateau Cheval Blanc. It is generally acknowledged that the Comte kept the quality of d’Yquem extremely high. However under Lurton, significant changes are occurring. Since 2005 the release price of d’Yquem has been bounced up by almost 100% to $750 / bottle which places it squarely among the First Growths in price. He also is allowing d’Yquem to be released as a future, whereas previously it had only been sold on release. Both changes show that he is positioning d’Yquem as a quasi First Growth both in market position and price.
This has created a couple of opportunities for Winevestors:
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The 2001 vintage was not only a vintage of the century, but may be the best vintage ever for Sauternes. The 2001 d’Yquem was given an extremely rare double century; a Parker 100 points and a Wine Spectator 100 points. The wine was released at $400 / bottle and even in this economy is currently selling for $550 / bottle. Sauternes is especially sensitive to 99 / 100 point scores – there is a bigger price differential between a 99 and a 95 Sauternes than there is in red Bordeaux. This wine will only continue to move upwards. The 2001 Sauternes vintage was a watershed moment for these sweet whites. All the top Sauternes of the vintage have forged significant price increases, which have made wine investors in general look at Sauternes with greater interest.
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The back vintages of d’Yquem as a result of the recent price increases suddenly look (relatively) inexpensive. The vintages to look out for are: 1983, 1986, 1988, 1989, 1990. These are all great vintages which will only go up in price. David Sokolin in his book ‘Investing in Liquid Assets’, sees these d’Yquems ‘doubling in value over the next five years’.
If you want to try d’Yquem and only pay an arm as opposed to an arm and a leg there are two buying opportunities right now:
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The 2002 and 2004 vintages were not rated by the Wine Advocate. Parker is not particularly fond of Sauternes and sometimes misses vintages. This has an immediate effect on price. The WS scores for the 2002 and 2004 are 96 and 95 / 100 respectively. However both can be purchased for around $220, a relative steal.
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The 1999 vintage was the first vintage that Pierre Lurton controlled the price. He dropped the price on release to around $130 in the US. The WS article covers the story. However word on the street suggests that the new regime was ‘dissing’ the last vintages under Lur-Saluces, prior to the new pricing policies coming in 2005. This wine has been scored 92 by Parker and 94 by Suckling, and yet can still be purchased today for around $170. It is a great way to try a taste of d’Yquem.
However all is not certain in the Sauternes market. In general dessert wines are out of style. People are more health conscious and in general are not having long heavy meals. This has meant the dessert wines, Sauternes and Port are out of fashion and, apart from d’Yquem, underpriced and under-collected compared with their dryer counterparts. It is uncertain how the Asian market will react to Sauternes although there is hope, as it goes well with Asian foods.
What about the rest? It is worth looking a quick look at the 1855 classification which after d’Yquem identified two other levels: Premiers Crus and Deuxièmes Crus. Unlike the red Bordeaux, the classification is totally outdated and from an investing perspective after d’Yquem there are only three wines worth noting and only in great vintages. The are in order: Climens, Rieussec and Suduiraut.
In 2008 Liv-ex researched these four top Sauternes properties, in the top recent vintages. They reported that Sauternes has not risen as much as Bordeaux in general; a 60% return compared to 163% from Jan 2004 to July 2008. However since then Bordeaux has fallen 50 points while Sauternes is down a mere 7 points. Rebecca Gibb reported on oldworld _r2_c2.jpg)
