November 12, 2008
Masseto: An Unprecedented Deal for Ornellaia, a New Trend for Italian Wines

Still wondering if you should be investing in Italian wine? Read this.

As international markets continue to plunge, more and more investors turn their attention to wine which lately has been referred to as “liquid gold” for its similar returns to the real thing. What was once gold, then real estate, today is wine and not necessarily just the Grand Crus Classés of Bordeaux. Italian labels are taking center stage as recently evidenced by an unprecedented deal made yesterday by Tenuta dell’Ornellaia with five of the largest French négociants, Cvbg Compagnie du vin de Bordeaux et de la Gironde, Joanne, Barrier, and Descave, Balland & Meneret).

The deal, first of its kind for Italy, allows the négociants to sell en primeur 20% of the Masseto 2006 production. Industry insiders believe this will be the first of many similar deals for Italy's best. This opportunity for Ornellaia, in fact, comes as a direct result of the increasing value of Masseto bottlings in recent international wine auctions (read more), which since 2004 has seen an average of 20% yearly rise, as reported by the winery Managing Director, Giovanni Geddes. This trend is sure to follow for other major Italian players on the auction scene, as Cvbg has already declared having started similar talks with other Italian names.

Simultaneously, a study by Mediobanca – Italy’s leading investment bank – was published yesterday, prompting the country’s leading newspapers and financial publications to dedicate front page space to the trend. The study reports that the Liv-ex index, which consists of 100 of the most prestigious labels in the world (none from Italy), has consistently outperformed since 2001 showing an average yearly growth of 12.9%, almost matching the 13% growth of gold. In tandem Italian wine labels are reporting record sales in prestigious wine auctions worldwide.

So what are the “golden rules” that investors and collectors alike should consider? According to an article published today by Il Giornale, there are four main principles necessary for building a valuable cellar and “transform it into a safe:” a few labels, but of the highest quality, rarity of the product, wines of exceptional longevity and labels in high demand on the market.

Some Gran Cru Italiani to consider for your collection, as suggested by AIS (the Italian National Sommelier Association) and reported in the article: Piedmont’s Gaja, Giacomo Contero Barolo Monfortino, and Bruno Giacosa Barbaresco Asili; Veneto’s Romano Dal Forno Amarone della Valpolicella Vigneto Monte Lodoletta; Tuscany’s own Tenuta San Guido Sassicaia, Biondi Santi Brunello di Montalcino, Tua Rita Redigaffi; and finally representing the south of Italy Montevetrano and Galardi Terra di Lavoro.