The growing gulf in the world of fine wine

The Atlantic Ocean has always represented a gulf in the fine wine market, but the gulf has deepened and widened considerably of late. Now that Hong Kong has become such an important centre for fine-wine auctions, not least because American auctioneer Acker Merrall & Condit has been targeting Hong Kong so vigorously, a considerable quantity of fine wine that would once have stayed in the US and moved between American cellars can now be found in Asia, particularly Hong Kong and mainland China.

But many of the fine-wine brokers, traders and merchants who cluster around London and represent a considerable proportion of the world’s fine-wine activity will have nothing to do with wine bought in the US and Asia. For Gary Boom, who founded Bordeaux Index in London in 1997 for example, this has been an article of faith. “We only ever purchase European stock and we feel that all UK merchants should follow suit. It is our firm belief that stock that has been across the oceans and back has too many risks attached.

“Shipping and airfreight leave a lot to be desired even today and, in general, the condition of the wines is not as good as European stock. The supply chain is simply too long in most cases.”

According to Adam Brett-Smith of traditional wine merchants Corney & Barrow: “I think that provenance will be one of the biggest differentiating factors in the buying/selling of fine wine. Provenance also encompasses the issue of fake wines and the conditions under which wines are stored, handled and shipped. When we set up our broking operation it was in acknowledgment of the existing brokers’ success but was also a deliberate attempt to redefine how brokers operated, with specific reference to sourcing.

“With this in mind, and right from the beginning, we set out the following criteria of where we do not source, which are perhaps seen as more relevant today than they were back in the early 1990s: we do not source from the US; we do not source from Asia; we do not source from auction.” For Corneys, as for most of the traditional merchants who decided to give the brokers a run for their money by setting up their own broking divisions, it is its own customers who provide much of what it trades, thereby offering the most convenient and reliable internal marketplace. 

If you have tens of thousands of cases of fine wine that has been sitting in your customers’ reserves section of a top quality bonded warehouse such as Octavian at Corsham ever since it was first shipped from Bordeaux, why venture out into the big, wide, unpredictable world to source wine?

Simon Staples of Berry Bros & Rudd is in a similar position. “Our private clients are our biggest suppliers currently and this will become even more important when BBX [the company’s forthcoming online trading platform for their customers’ own wines] is launched in a few weeks.

“We also buy from five or six UK merchants, perhaps four European merchants and from the négociants of course. Never from auction, rarely from private homes. We hardly ever have old wine on our list because I’m increasingly worried about fakes and ‘world traded stock’.

“I really would not buy for myself a case of anything older than 2001 from anyone unless I know where it’s been. There have been far too many experiences of badly stored older wine compared to perfect stock.” Wines that are sold in the US tend to have slip labels citing the name of the American importer and the warning label citing the evils of alcohol that is mandatory in the US. So, unless a wily trader carefully removes these slip labels, it is usually very obvious which bottles have crossed the Atlantic twice. As Mark Bedini of Fine & Rare Wines explains: “We never sell US or other non-European sourced stock without it being clearly highlighted on the offer, or included in the wine description,” and prices for such bottles are routinely lower than those apparently bought in Europe – unless the bottles contain American wine, of course.

Chris Davies of fine-wine traders Turville Valley Wines has even come across wines whose back labels had been deliberately removed because they cited a US importer. But since these back labels also carried the information on volume and alcoholic strength that is mandatory in the EU, the wine was thus rendered unsaleable in Europe.

He says: “For us the Far East is a no-no and we never buy anything that’s been there, or that’s been there and back. That said, unless such bottles have importers’ labels attached to them, or there is a shipping label on the case, there is no way of telling where the wine has been.

“For this reason, as well as many other reasons, we only buy from suppliers we have got to know and trust.”

He is far from the only one to refer to the importance of specific trusted suppliers. Stephen Browett of the biggest fine wine traders Farr Vintners says: “We don’t have so much a policy of ‘where’, more of ‘how’ wines have been stored. Provenance and good storage are the key issues rather than blanket ‘France = good’ and ‘anywhere else = bad’.

“We would not, for example, buy wine that has been stored next to a hot kitchen in the south of France but we would buy wine that has been stored in a cold cellar in Sweden or Denmark. [I concur that the cooler a wine is stored, the longer it lasts.] The issue of strip labels sometimes comes up. If we are offered a parcel of wine that has never been distributed outside Europe but may have been labelled up (for example with [Diageo’s US importer] Chateau & Estate strip labels for the US market) we are happy to sell the wine (described as such) provided we have proof of perfect provenance and storage.”

It should be noted however that many of these brokers, traders and merchants, including Bordeaux Index, now have an outpost in Hong Kong. Presumably Gary Boom feels that bottles can withstand one long journey between London and Hong Kong, so long as it is in an easterly direction.

Buying and Investing in Wine supplement: Jancis Robinson’s recommendations for fine wines in the £30 to £50 price range

www.jancisrobinson.com

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