Wine Pricing at Auction - MENTAL

First post here. Given the economic backdrop, restaurant business down 80% (not recovering anywhere close to half of that this year IMO), hearing large pressure on distributors from friends ITB, and certain pockets of the wine market inflated beyond anything I’ve seen in any “asset class”, a few data points have stuck out - I’m scratching my head wondering if folks aggressively bidding on some of the lots I have seen are a) delusional b) stupid c) so rich that they will buy at any price if it’s a house producer/wine for them. d) All of the above. Looking at the Acker weekly auction, a few lots that come to mind:

  1. Boisson-Vadot Meursault Tessons 2012, estimated range $110-$150 (seemed light I would have said $180-$280), current bid $450. That’s $200/bottle after tax/premium. What the f***?! Have a handful of these in my cellar and paid $75/apiece.
  2. Pernot Folatieres 2012, current bid $220 for 3. CHEAPER AT RETAIL FOR NEW RELEASE
  3. Boisson-Vadot Meursault Genevieres 2007, $850 for 3.
  4. There seems to be a bidder (“s***y”) that has bid everything in white burgundy through the nose.

These are just a few examples, but trying to make sense of what appears to be nonsense if anyone has thought here.

And separately how is Boisson-Vadot seemingly trading at Roulot prices all of a sudden (for a producer that IMO is clearly inferior)?

The have’s still have and with stock market so far, have more… the have not’s have less, so this isn’t surprising.

More than likely above is an anomaly of someone who just wants it and isn’t going to mess around with small incremental bids.

Consider it good news for your wallet and move on to the next one you may really want?

[snort.gif]

Who knows, sometimes producers get quite popular in small circles and it becomes more than about money. It’s probably a small blip.

I think no small portion of this is if I’m going to be stuck at home I might as well drink well. I know I have more time to drink wine. I’m not driving much after all.

People can spend their money the way they want - after they pay taxes of course… Simple as that. Maybe you should track this “sy" person down and shame them for doing the unthinkable? This is the only thing I think you can do. Pretty sure a hacker could find out all of "sy”'s information if you tried hard enough. Trying to rationalize this for you Ryan: envision that this “sy" person has quit smoking as a personal choice and because it will flatten the curve of cancer deaths from second hand smoke (great personal choice by "sy” IMHO - right?) — “sy" isn’t paying taxes to local governments now because "sy” isn’t paying for cigarettes anymore (is this a bad decision by “sy"?) — "sy” will take this new found $ that they’ve made and put in they’re weekly family entertainment budget and is deciding to buy these bottles because 2012 is the birth year of their next door neighbors now 8yo son. The next door neighbor lost her job because of the current state of the economy and could use a nice gesture and bottle of wine to enjoy with her husband as they form a strategy to keep their family going forward. As you can see, “sy" has made a series of decisions that are good and bad depending on who you ask - but - in the end if you can imagine all of the likely reasons "sy” might be formulating to spend their own $ - you can be comforted that you don’t have to make these decisions for “s***y”.

Honestly those prices aren’t even that nuts in the context of the current market. Boisson has gotten hot for whatever reason. Release prices are certainly lower but no bottles of the charrons available on wspro much under 200. Genevieves has hammered over 300 in other vintages. And pernot cheapest online is 85. So after vig this is not much more than that, plus maybe he/she wants that vintages, or buys a lot from acker so added shipping of buying elsewhere would make it worse.

Look, I get it, these are only a few data points, likely some idiosyncrasy w/Boisson, not terribly indicative of the true “market” and the intent was not to take a shot at “s***y” but rather I’m trying to wrap my head around what may just be an irrational market to begin with. Happy to say “sold to you” to the bidder(s) at these levels. Having sat through (and luckily, survived) the depths of the financial crisis in a banking role, I can unequivocally state that this is much worse, although with an infinite Fed bailout/propping up of of the banks/hedge fund/PE community here the impact will be skewed towards the lower income folks…again…sadly.

Would add that in the Acker auction everything else is pretty reasonable right now… plenty of lots without any bids even. The estimates for Boisson were way too low – not indicative of current demand for the wines. And frankly, the wines are pretty damn good, it’s not crazy to me that there are bids that size for them.

not everyone’s income has been hurt in this scourge—some are even prospering.

some wine collectors are addicted to buying.

many don’t look at retail pricing/availability and just pay what they need to for what they want.

wine collecting is irrational—don’t try to apply logic.

Is there any known auction manipulation? E.G., sellers buying their own wine, or auction houses directly bidding?

That’s a good question to ask vs. the possibility that freedom of choice to spend your $ when/where you want is in play here… Who knows - there’s probably some governmental agency like the SEC policing the auction market? Like they found the members of congress shorting their stock before the “rona” virus showed up? Definitely don’t want to say the word corona because it would and will negatively impact the sales of its namesake beer causing loss of jobs and financial ruin in the food and beverage industry. See - straying away from the rationalization that freedom of choice is to blame causes all kinds of problems! pileon

I saw this earlier in the week and thought they must have accidentally added a zero to the opening bid price. Now I see somebody has actually bid on it.

https://www.winebid.com/BuyWine/Item/7396202/2004-Domaine-Leroy-Bourgogne-Rouge

Lowest price on WSP is $3,000 so I guess that might end up being a steal? [wow.gif]

I feel a bit out of the loop… why is the 04 Leroy BR so much more expensive than all other vintages? Appears to be consistent across international markets.

Declassified Domaine lots due to the 2004 vintage, hence a “Domaine” bottling vs. “Maison” as per normal.

I mean, I’ve had the 2004 a few times and it’s decent juice for the vintage but hard to imagine paying more than release for the experience.

And when young it was very 2004 green though I’ve heard that’s cleared up since then.

Pretty much, though there are some bets you can count on over time. You can also count on some rich people getting chumped along the way and something you wouldn’t expect catching the eye of people with money.

And that '04 Leroy may be a little bit of all three [wink.gif]

There’s also the idea that with so many people Staying Home right now, you have people bidding out of boredom.

One other thing to remember when it comes to auction. Very often we look at it in context of US retail. Very few US retailers will ship overseas. Virtually all auction houses will.

I know some consumers in S America that bid often and the prices I know they’ve paid make me scratch my head-until they told me what they would’ve had to pay to source them locally.

However, I will agree that the recent Acker, Christie’s and Sotheby’s auctions have all been stronger than I would’ve guessed.

I would guess we are still 60days out from real pressure on high end wine and luxury good prices. High end cars have come off considerably 30%, watches have pulled back 10-20% which puts them at 2018 prices. High end shotguns haven’t flinched. Just my observations.

The top 10% in this country Own it and can pretty much buy whatever-the-hell they want since they are so steenking rich.
That’s the sum of it.