For The Love Of Port

Price question :
I can buy Taylor's VP 2007 for 66,60 EUR / bottle. Is this an interesting price/investment ??
What is the standard price of such bottles ??

For retail that is a really good price

Tom
Historically, Port is a really bad investment if you're thinking of making a buck by selling it in a few years time. Bourdeaux/Burgundy it is not (even those have taken a hit lately).

If you mean for drinking investment, then you can't go wrong with it. It's a wonderful VP.

The price seems to be about what it was on release here in the states (using current exchange rates). Though I have no idea what current prices are in your area so can't help out too much there.

To be honest, I think the '07 is one of Taylor's least impressive recent offerings. By contrast, the '09 is a superb VP that could easily emerge as a classic.

From an investment standpoint, the price of VP tends to go nowhere, and sometimes down, between the tenth and twentieth years, so not one to rush out for

As far as price goes, 66.60 EUR may seem a good price in some circles, but it can be bought in the UK for £48 tax incl which is about 15% cheaper.

Andy Velebil wrote: Historically, Port is a really bad investment if you're thinking of making a buck by selling it in a few years time. Bourdeaux/Burgundy it is not (even those have taken a hit lately).

Really? I've quite often seen bottles from younger vintages go for around 200 DKK more than they did on launch only 2-3 years earlier. That is a nice profit of around 50% over 3 years which is an average of 17% per year. That is better than what most hedge funds can manage in a good year. Also you don't have to pay a cut of your earnings to the investors.

So perhaps you are right historically, but at least recently in Denmark this is not the case.

Thomas V wrote:

Andy Velebil wrote: Historically, Port is a really bad investment if you're thinking of making a buck by selling it in a few years time. Bourdeaux/Burgundy it is not (even those have taken a hit lately).

Really? I've quite often seen bottles from younger vintages go for around 200 DKK more than they did on launch only 2-3 years earlier. That is a nice profit of around 50% over 3 years which is an average of 17% per year. That is better than what most hedge funds can manage in a good year. Also you don't have to pay a cut of your earnings to the investors.

So perhaps you are right historically, but at least recently in Denmark this is not the case.

IF a VP gets a great score, like 2011 Dow did, then yes it can go up pretty quick. However, they tend to spike then come back down to a more reasonable level after some time. But in regard to almost all VP they don't go up in price after release much if at all. Many actually come down, as Tom mentioned, before slowly heading back up many years down the road. Add in the cost to store them properly for many years of decades and they are not a good investment monetarily as far as wine goes. In reality there is only a very small amount of top Bordeaux and Burgundy, and a few smatterings from other regions, that are.

Andy Velebil wrote:

Thomas V wrote:

Andy Velebil wrote: Historically, Port is a really bad investment if you're thinking of making a buck by selling it in a few years time. Bourdeaux/Burgundy it is not (even those have taken a hit lately).

Really? I've quite often seen bottles from younger vintages go for around 200 DKK more than they did on launch only 2-3 years earlier. That is a nice profit of around 50% over 3 years which is an average of 17% per year. That is better than what most hedge funds can manage in a good year. Also you don't have to pay a cut of your earnings to the investors.

So perhaps you are right historically, but at least recently in Denmark this is not the case.

IF a VP gets a great score, like 2011 Dow did, then yes it can go up pretty quick. However, they tend to spike then come back down to a more reasonable level after some time. But in regard to almost all VP they don't go up in price after release much if at all. Many actually come down, as Tom mentioned, before slowly heading back up many years down the road. Add in the cost to store them properly for many years of decades and they are not a good investment monetarily as far as wine goes. In reality there is only a very small amount of top Bordeaux and Burgundy, and a few smatterings from other regions, that are.

I must be careful not to get my head in too deep here as I am nowhere near as experienced within ports as you nor Tom. That is for sure. Perhaps you are also both referring historically and globally to the matter in question here? But I will take the bait and add my take to the discussion about port being a sound investment.

Myself I have merely been paying attention to the Danish marked which is unique in a few different ways.

Shipping alcohol privately in Denmark is legal and cheap. Around 10 dollars for up to 5-6 kg of cargo.
We are a small country which allows for easily selling bottles of port privately or collecting them one self. The longest drive you can take in Denmark is around 4 hours.
People are willing to spend quite a lot of money on port and wine in general. Quality > Quantity
Most people I come across do not seem to care much about provenance, they tend to focus more on the house and the price.
Some of the Danish importers have unfairly high prices on the house they have the exclusive on, this includes Niepoort, Ramos Pinto, Taylor's, Fonseca and Quinta do Noval. (Graham's, Dow's & Vesuvio is decently priced)

An example from the 2011 vintage according to a very knowledgeable port enthusiast that did buy en primeur from Danish importers

Danish En Primeur prices
2011 Taylor's 485 DKK
2011 Graham's 440 DKK
2011 Dow's 425 DKK

Prices they would easily go for today in Denmark.
2011 Taylor's 650 DKK
2011 Graham's 600 DKK
2011 Dow's 1000+ DKK

Let's say you bought an extra case of each and sold them now after owning them since 2014, which is 3 years of possession.

(12*165)+(12*160)+(12*575) = 10.800 DKK return on investment.

(10.800 / 16.200) * 100 = 67 % over 3 years = 22 % over 1 year.

I would take that any day of the week. I will agree that any vintage will reach a threshold where they will not increase much more over time. But there is a soft spot where there is a very nice return of investment after a few years and it is not my experience that they decline in cost after that point.

If you exclude the 2011 Dow's the return in percent over 3 years = 36 % = 12% over 1 year.

Not so impressive but still very solid and no investor fee to cut into the return. Also if you do buy from all the major houses (Taylor's, Fonseca, Noval, Dow's, Graham's), 1 of them pretty surely will be a home run hitter like the 2011 Dow's to inflate the numbers substantially.

Let me hear what you think

Thomas,

On question - the prices you quote for today 600 / 650 / 1000 DKK - is that what you would pay to buy these wines today or is it what a private individual could expect to receive from a private sale or after paying auction fees etc?

My experience in the UK is that often people over-estimate what they can sell a wine or port for because they look at retail prices. Retail prices include the retailer's margin and normally a private seller will only get around 50% of the retail price.

Al B. wrote:Thomas,

On question - the prices you quote for today 600 / 650 / 1000 DKK - is that what you would pay to buy these wines today or is it what a private individual could expect to receive from a private sale or after paying auction fees etc?

My experience in the UK is that often people over-estimate what they can sell a wine or port for because they look at retail prices. Retail prices include the retailer's margin and normally a private seller will only get around 50% of the retail price.

Hi Al,

Those prices I listed are prices I've seen people sell those ports for privately.

I do agree some people looking to sell attempt to sell for retail prices which they have found on the internet. They are quickly informed by others especially on facebook that private sales wont fetch that kind of prices. But quality port in Denmark sells quickly and private sales is flourishing. This is also become much easier with smart bank apps where you can transfer money instantly via phone numbers connected to a debit card. Also shipping isn't expensive and our temperated climate doesn't pose much of a problem (Also the average person as I mentioned does not care much for provenance nor temperature factors when buying VPs)

In this article about Denmark and port wine there are some interesting numbers. Using google translate:

https://www.publico.pt/2017/05/06/econo ... in-1771104

Denmark is the seventh largest customer of Port wine. Last year it imported 12.5 million euros from Portvin (about 1.5 million liters, or 0.30 liters per inhabitant). But, more importantly than this number, is the fact that the wine that the Danes drink have an average price of 8.12 euros per liter, worth about 40% above the industry average. And, unlike most markets, Denmark is experiencing strong growth, especially in the range of special categories (Vintage or older wines), which increased by 10.1% last year.

Conclusion. The Danes have money to spend on luxury goods such as wine and want quality and they are willing to pay for it.

Thomas a very good conclusion! And glad they are doing their part.


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