FEATURES ARCHIVE

Summary
The wine market has rebounded solidly after the difficulties of last year. While we have not yet regained the height of the market for every wine, prices are trending up and further improvement is likely in the season before us.

Background
As we prepare for the Fall 2009 wine auction season, it will serve us well to examine current trends in the wine auction market. The market experienced an unprecedented run-up between the Spring season of 2003 and the Spring season of 2008. Once the world (and the world economy) recovered from the shock of the events of September 11, 2001, the market began to gather steam, and prices began an inexorable climb, and through the spring season of 2008 this trend showed no signs of abating.

After the fall of Lehman Brothers and beginning of the economic crisis, however, these prices looked very high indeed. The wine auction market, like many others, saw profound uncertainty, and sale prices and volume both floundered. The sales that took place in November and December of 2008 were mixed at best, and the Christie’s International Wine Department re-evaluated our estimates.

Spring 2009
Christie'sNYWines decided during this period to push our spring season back by a month, and we scheduled sales in March, April, May, and June. It now appears in retrospect that January 2009 was the bottom of the market, and that after this point the tide began to turn.

Although collectors were buying and the revised lower market estimates encouraged the enthusiastic return of buyers as the season progressed, the demand for the top wines was relatively subdued, and prices were still fairly soft, with prices during the earlier sales still hovering near the low estimate. As confidence built, however, prices began to climb again, and by the end of the season, wines were hammering near the top of the range. By June, selling above the high estimate was once again a reality.

Specific Examples:
Margaux 1982
Five years ago, 1982 Margaux was trading for an average $458/btl. The average today is $646/btl, an increase of 41%, and this represents a 34% decline from the ’07 average of $984/btl. The wine, in fact, has often traded for over $1000/btl, a level first seen in 2004. The yearly high has been consistently above this level, and even this year, the wine has sold for over $1,100 with premium.

Mouton 1982
The average hammer price per case for 1982 Mouton for the calendar year 2004 was $5,000, and climbed to $6,500 in 2005, and $8,000 in 2006. By 2007 the annual average price had hit $11,000, buoyed by very strong prices in some American sales, giving a nominal appreciation of 133% for the period from 2004 – 2007. The average hammer slid slightly in 2008 to $10,000, and more precipitously in the Spring season of 2009 to $7,500 (through May), giving the wine an average appreciation of 67% for the past five years.

The high end of the average was created by very strong prices from Asia for inventory with amazing condition and provenance, while the low end was depressed by soft prices on broken case lots. The estimates are still commonly $6,000 to $9,000, and it is possible for the savvy buyer to snag a case of twelve in wood for $7,500, although collectors can rest assured that this price will not last, as evinced by recent strong results.

Prognosis for the Autumn 2009 Season
Fortunately for collectors of the best wines, interest here has once again returned. Moving into our fall season of sales, I feel a renewed confidence in the market. We have built a wonderful series of fall sales thus far.

Collectors will naturally wonder when the height of the market has been regained. Clients who are interested in discussing the current state of the market should feel free to contact the wine department, and it will be our pleasure to look over current trends together.