The bargain profit days for investment buyers of new release Penfolds Grange appear to be over with auction prices lower than retail ones. For many decades Penfolds were cautious releasing Grange at a price whch allowed collectors to make an instant gain. The 1972 was priced at $12.50 while the 1976 was the first Australian wine over $20. The resale price of the 1976 is now $800 to $1000. With the number of collectors growing, the market for the earlier vintages grew so prices continued to climb creating a sure bet for collectors.
As the confidence at Penfolds grew the release price began to reflect the resale price. This meant more money for Penfolds and an increasingly risky bet for collectors. The Wickmans auction prices show vintage 2002, released in 2005 for $500, as the crossover vintage with the resale price now $390 to $480. The 2013, released with a retail price of $850 in October 2017, still generally sells at auction below $800.
Perhaps one reason for the absence of price growth for recent Granges is that their initial meteoric rises trickled down to the wider Australian wine business leading to a great number of wineries climbing on board to explore their upper price limit. The choice for investor/collectors is much greater than it was a decade ago.
Can today’s prices of these expensive wines plateau or reverse? No signs yet though it is possible. Of course, auctioneers and those that deal in the luxury end will dispute that the prices are unrealistic, and they may be right.
To Glug customers, I reiterate the perspective that the difference in taste between wines is compressed not broad. This means expensive collectables are marginally better than those we offer. For example, the taste is expressed in expensive new oak which we do not use. Ask yourself do you want that taste in a wine? However there are exceptions, uncommon in my experience, where expensive wines are indeed transporting. What this experience is worth I do not know.
