Wine a popular inflation hedge

Press, 12 January 1981, Page 7

Wine a popular inflation hedge

By

KEN COATES

in London Wine, provided the investor resists the temptation to drink it, is becoming a more popular hedge against inflation. Stocks of the finest wines, spirits, and vintage port appreciate in value each year, and some hardup owners of private cellars have decided to cash in. There is the added advantage that profits from wine sales are not subject to capital gains tax.

The famous auctioneers, Sothebys, which established a wine department 10 years ago, conducts 20 wine auctions a year under the direction of Mr Patrick Grubb, master of wine.

The sales cater for all tastes, as it were — the rarest wines are put up for auction as investors turn their liquid into cash, ■and wine merchants dis-' pose of surplus stock in an international market. A cellar of fine claret and burgundy, which had survived the German invasion of Belgium only because it had been' walled uo, realised almost $40,000 last September. One private collector paid $14,000 for a bottle of 1803 Chateau Lafite and $7OOO for a bottle of

the 1822 vintage. Sotheby’s reports a steady recovery in the value of the best. Chateaux and recent vintages. The 1959, 1961 and 1966 are as popular as ever, “showing a healthy rise in price.” Last October, $lOlO per dozen was paid for Chateau Lafite 1959, but the firm reports a cautious reaction to what' it terms, "lesser growths and vintages.” . To investors planning to lay down “the younger vintages of claret,” the firm advises that they would do well to consider the excellent 1975 s and even at today’s prices, any remaining stocks of the 1970 s and certain 19715.

Sothebys held its first auction of American wine and hopes to hold wine auctions in New York. The firm recently held its first sale at Chester, there is an annual wine sale in Scotland, and sales in the Netherlands and Switzerland and in Italy. One notable auction at the Palazzo Capponi in Florence was of a cellar of a noble Florentine family which since the early eighteenth century had remained at a constant and ideal temperature. Another highlight was the disposal of extremely

rare old Cape Constantia wine from the cellars of the Duke, of Northumberland . at Alnwick Castle. The top price was $520 for a half-bottle paid by a South Africa collector.

Then there was the bottle of the rarest Imperial Tokay liqueur dating from the late seventeenth century.* It is believed to be the oldest bottle of wine sold at auction since World War II and fetched $2600.

Phillips, another leading auction house, advises ift; vestors to look to furniture. particularly eighteenth century, when seeking. a hedge against inflation. This is followed closely by jewellery, although silver, and eighteen t h-century English landscape paintings and water colours are sound. Other leaders include eighteenth-century English cermiacs, art nouveau and deco, oriental rugs, Japanese ' paintings, costumes and lace, duelling pistols and toys, including lead soldiers and early Dinky. Helped by a wave of nostalgia, a thriving market in “cricketana” blossomed in 1980 when a 150-year series of Wisden Cricket Almanac changed hands for $15,000.