Despite producing world-class wines, Spain still only represents only a tiny proportion of fine wines sales, where the classic French regions of Bordeaux, Burgundy, and increasingly, Champagne, dominate. “Of the £13 million of assets we have under management, less than £100,000 is of Spanish wine,” claims Patrick McConnell, CEO of London-based fine wine investment broker Vin-X.
However, the Liv-Ex classification 2023 –a ranking of wines by their average trade price– saw a 40% increase in the number of Spanish wines included, compared to 2022.
2023 also saw the third vintage release of Telmo Rodriguez’s Yjar on the historic distribution network for fine wine, La Place de Bordeaux. And as specialist wine auctioneer Charlie Foley of London’s famed auction house, Christie’s, says; “Telmo Rodriguez is the crown prince of fine wine in Rioja, anything he does others will follow.”
Foley is well aware of the latest developments, as he was responsible for an auction of top crus Les Manyes and Les Tosses from Terroir Al Limit in Priorat in 2022. However, these sales continue to be an exception, as he explains: “Vega Sicilia Único and Valbuena are usually the only Spanish wines that pop up at auction. Tondonia occasionally appears but it’s never been in the same price bracket. The wines of Alvaro Palacios have now achieved a price in the last few years that make them relevant for auction. As for Castillo Ygay, people love that wine and its beautiful, memorable label. But, generally, if someone with a cellar has bought Spanish wine, they’ve drunk it.”
Check out tips and investment recommendations from Almudena Alberca MW at the end of this piece. She is an ambassador for Oeno, a London-based wine investment company with a new Spanish office.
Pingus, Vega Sicilia and Aalto are stalwarts. “They have longevity, they still taste great after 15, 20 years,” Foley explains, whereas some of the traditional styles of Rioja haven’t aged so well. “Generally speaking, the old Riojas – the 1950s Riscals and such like - are oxidative, that’s the point of them, which is fine for certain buyers but it’s not something that a lot of clients, particularly in Asia, will want to drink.”
As for sherry, he adds “There aren’t enough vintage examples. Buyers understand vintages. The solera system hasn’t reached them in the same way. But we’ve offered things direct from sherry producers that are old and quirky, and people love a story. Equipo Navazos offering wines on La Place should help.”
La Place and the en primeur system are vital. “You can’t have investment grade wine without en primeur,” states Foley. “And that has been the major issue for Spain. Tondonia is stored in the winery for six to ten years, Vega Sicilia for ten years, so they take out the potential investment value.”
Robbie Stevens, senior broker at Liv-Ex agrees. “Selling more wines through La Place is crucial for raising awareness of premium Spanish wines and ensuring they are distributed more widely, as well as garnering more critical acclaim.”
The growth of Barolo en primeur has certainly been key to Italy’s success in the Liv-Ex 2023.
Spain’s pricing means that until recently, it simply hasn’t qualified as “fine wine”. As Pedro Ballesteros MW said at Madrid Fusion 2024 in his ideation of the “50-50-50 Club”, Spain needs "50 brands, selling more than 50,000 bottles, worldwide, at more than 50 euros a bottle". Foley concurs that wines priced below £50 don’t attract the sort of returns that make them worth bringing to auction.
In fact, Liv-Ex only records sales of wines priced over £30 per bottle and until recently, Pingus, Vega Sicilia and Clos Mogador were the only Spanish producers to feature on the ranking. But last year saw two Riojan wines - CVNE Imperial Gran Reserva and Muga Prado Enea Gran Reserva – make an appearance. According to Liv-ex, two further Spanish wines met the criteria for inclusion in the Classification but fell just outside of the lowest price bracket: Psi from Dominio de Pingus and R. López de Heredia Tondonia Tinto Reserva.
“The fact that these wines recorded enough trade on Liv-ex over the year to pass the criteria for inclusion implies there is an appetite for them, which means they could well see their prices rise enough to make future editions of the Classification,” speculates Stevens.
But to reach these prices, it is essential to have a clear concept and communicate it well through the right channels, as Foley explains. “Producers need to go back to the beginning, to figure out whether they follow the Bordeaux or the Burgundy model. For a Bordeaux producer, it’s about brand. Château Latour is a good example; they’ve got a Grand Vin, then Les Forts de Latour and a restaurant wine, a Pauillac. Three wines that are easy to pronounce and understand. “Or if you are a Burgundy-style producer, then it’s all about the terroir of your little plots, Romanée-Conti, La Tâche… So Barolo, by its nature, is Burgundy-style, Rioja is probably more Bordeaux-style, although there are producers like Alvaro Palacios who have gone along the Burgundy route. It doesn’t matter as long as you’ve decided on your philosophy and then limit supply. People aren’t going to fight over something if everyone can get it. That’s what Comando G has done. They are the new wave of Spain; they release their wines after just one year and you find bottles in wine bars in Japan for 300€, it’s really quite amazing.”
It is important that wineries create their own brand identity, and don’t rely on generics, Foley continues. “Consumers are confused by the new appellations in Rioja and Priorat. I can’t tell you the name of any of the Pagos, but I can tell you I like Telmo Rodriguez and Comando G and these wines sell at auction.”
Relying on Parker points is also a thing of the past, adds Foley. “People will find a critic they like and follow them, whether that’s Tim Atkin MW, Jancis Robinson MW… Neal Martin is a dominant voice, as is Galloni. But social media has changed everything, people see a picture and want something because the label is fun, or they check on CellarTracker. Any noise that’s created within wine circles– whether that’s Decanter tastings or Tim Atkin’s Top 100 – filters through to people buying more of those wines.”
Edmund Cole, Portfolio Manager at Vin-X highlights distribution as a key factor. “In terms of building the perception of Spain as a producer of investment-worthy fine wine, distribution is crucial. The key hotspots are the USA, Asia and the UK, particularly Michelin-starred restaurants in London. Many of the most successful labels are also linked to luxury goods houses in Bordeaux and Champagne.”
The secondary wine market has changed in line with the profile of buyers, with Burgundy and Champagne growing in the blue-chip market alongside the number of female collectors.
“Traditionally all our buyers were male and over 60 but that has changed in the last few years, especially with online sales. Now there are a lot of buyers under the age of 40, a lot more women. And whereas the Rioja buyer is generally a traditional Bordeaux buyer, people who buy things like Comando G and Terroir al Limit buy Burgundy, Barolo, they geek out. They would drive to Gredos to see the vineyard with all the boulders,” explains Foley.
The market is also a lot less London-centric than in the past. “When we auctioned Terroir al Limit a lot of it sold to a collector in Brazil”, adds Foley. “We don’t sell a lot of Spanish wine at the moment to Asia, there’s a lot of work to be done there in trying to get the names and brands understood and recognized.”
Despite shoots of growth, many in the trade are yet to be convinced of Spain’s potential. When Liv-ex’s Global wine trade predictions for 2024 survey asked its members which regions they expected to perform best in 2024, 39.7% of respondents positioned Spain in the second-to-last position, with only Australia ranked lower.
Cole is similarly reticent. “The only Spanish wines we recommend investing in are Vega Sicilia and Pingus. That is based on their pricing and long-term stable growth. Vega Sicilia has seen 29% growth over the last five vintages, which is similar to Bordeaux.”
However, in terms of regions to watch, Cole mentions Priorat. “It is perhaps the unsung hero. It has limitation in supply due to its geography but needs to develop its distribution networks.”
Foley cites Roda as a name for the future. “They’ve done the Bordeaux thing by having Sela that is more affordable and then Roda, Roda I and their top wine Cirsion, which will probably pop up at auction in the next 5-10 years.”
But he thinks Spanish whites deserve to grow. “Godello is now one of the most popular house wines in London. Yet, apart from Castillo Ygay and Tondonia, Spanish white wines don’t really appear at auction. With everything Abel Mendoza is doing in terms of terroir specific plots, his white Riojas should be much more famous. Will they make it to the secondary market? I don’t know, but I always buy his wines if I see them on a restaurant list.”
And what does a Christie’s auctioneer buy to drink at home? “For my own enjoyment, I buy mostly Italy and Spain. Priorat and the affordable wines from Comando G, Sara Pérez and René Barbier’s wine from DO Montsant; new wave stuff that is fun and at the right price point. And sherry. The wine department at Christie’s mainly drinks sherry and Riesling!
Foley also confesses his love of Garnacha. “Restraining the alcohol is the problem, but when producers achieve that, it’s great. It’s got such ethereal qualities about it. It’s not a foursquare grape that you need some food to attack. The best part of any meal is the bit before, the preparing, the cooking, and it’s good to open a Pinot Noir or Garnacha then, rather than wines that need a plate of steak.”
But he warns that there are two wine markets. “The blue chip investment wines and the wonderful wines like Tondonia that we actually drink. God bless María José López de Heredia, she’s selling at the right prices and may that never change, as people who love the wines are actually drinking them.”
SOLID BETS AND A GLIMPSE INTO A POSSIBLE FUTURE
By Almudena Alberca MW
For millennia, wine has mirrored mankind's changing activities, but never before has this evolution taken place at such a dizzying pace. In an increasingly volatile and unpredictable environment, investing in wine has proven to be a safe and reliable alternative to diversify one's portfolio.
Spain is experiencing a golden age in its wine history. The country is producing its finest wines and has a very bright future ahead of it. The new generation of producers is pushing the boundaries, recovering forgotten vineyards and producing new and exciting expressions of the country's terroirs.
Spain lacks a long-standing tradition in wine investment, but interest has grown in recent years and the trend is set to continue. It is a good time to develop strategies to build a personal portfolio.
Diversification is the best way to manage investment performance.
The classics are always a safe bet. The Spanish must-haves in this regard are Vega Sicilia, Dominio de Pingus and Álvaro Palacios.
The second set of essential Spanish classics are the finest Rioja Gran Reserva wines with proven ageing potential: La Rioja Alta's 890 and 904, Marqués de Murrieta's Castillo Ygay, Muga's Prado Enea and the unbeatable Tondonia from the fascinating María José López de Heredia.
Spanish fortified wines from Jerez and Montilla-Moriles are not yet prominent on the investment scene, but I personally believe they are treasures that will be highly sought after as consumption and production continue to decline due to limited supply. A good example of this are the very old Pedro Ximénez vintages from Toro Albalá, which are on the Liv-Ex list of Spain's most sought-after wines.
On the other hand, there are a number of bold entrepreneurs who have made their mark on the Place de Bordeaux. Telmo Rodríguez and Vivaltus led the way, followed by Marqués de Riscal, Cvne, Algueira, the charming Willy Pérez and Ramiro Ibáñez with De La Riva, and the energetic Benjamin Romeo from Bodega Contador, who surprised everyone with Alma.
No serious portfolio should be without up-and-coming producers with promising careers ahead of them and who offer more affordable prices. Getting ahead and investing in rising stars is always exciting.
This list could go on, but here are a few examples. In Ribera del Duero, Francisco Barona has all the attributes for success, starting with his human qualities and spectacular vineyards in one of the best areas of the appellation, not to mention his first-class training and dedication. Also in Ribera, Michael Zaccagnini is making a name for himself with his Seisolo project; the quality of his first vintages is exceptional. In Jumilla, the Cerdán brothers of Bodegas Cerrón are doing exceptional work with strong ideas and a long-term project that is worth following closely.
White wines are less popular investments, but some regions such as Rías Baixas and Valdeorras with winemakers like Do Ferreiro and Rafael Palacios respectively have shown for years that their wines can age successfully.
Whatever the portfolio, investors should remember that patience is required as it will take several years for the wines to gain value. Should investors despair while waiting, they can always pop the cork on any wine they fancy.
