The one and only – Vega

I think it’s fair to say that the market is taking a while to get to grips with Vega Sicilia Unico.

This estate from the Ribera del Duero in northern Spain has been producing wines since the 1860s, and it is fair to say that they are standing the test of time.

Of the 100-point 1962 vintage as recently as 2012 Neal Martin opined: “Youthful, vivacious and utterly compelling, this is a profound wine that even after four decades is surfeit with precocity.” The very definition of a fine wine.”

At Amphora for the last year or so we have been trumpeting the value of the 2004, a superb 97-pointer whose score matches the 1970 and the 1995, in fact since the aforementioned 1962 only the 1998 has a better score, at 98 points. As to their stage of drinking lifetime, the 1970 and the 1995 are still designated as “early”. These beauties run and run.

The thing is, there are only about 7,300 cases of the 2004, so they could easily be drunk before the end of their useful life, which has significant implications for pricing down the line. Certainly most vintages from the 1990s come in around the £3,000 mark, which is very encouraging for a quality 2004 which only costs £1,900 or so. Neal Martin again: “The 2004 has a haunting bouquet of dark brambly black fruit, cassis, honey, a tang of marmalade and bacon fat.”

Who can resist the tang of marmalade and bacon fat!

As you can see from the chart below, the Vega 2002 and the 2003 woke up with a bit of a start recently. Respectively their scores are 95 and 94-points, both inferior to the 97 of 2004. The vintage scores of 2002, 2003 and 2004 respectively are 78, 88 and 95. By any measure the 2004 is ludicrously cheap, by using directly comparable data. If 1 + 1 doesn’t make 2, you are on to something.

Consider in addition that there are seven cases of the 2002 in the market at £1,950, and when they have gone the next quote is £2,570.

As for the 2003, which tends to trade in three-bottle cases, there is one in the market at £470, then the next availability is above £530. Or over £2,100 for 12.

Buy the 2004!

Alongside Dominus, Opus One and Penfold’s Grange all of which we have been talking about in recent weeks, this Vega (along with Taylor’s Port, unusually), comprise the Liv-ex Rest of the World sub-index, a sub-index which has outperformed all the others in the Liv-ex 1000 over the last five years. This outperformance has obviously attracted investor attention, which can only lead to an expansion of interest in this sector.

There aren’t many investable wines in Spain, but it wouldn’t be fair of us not to highlight another which sits along the banks of the Ribera del Duero, in the delightfully named town of Quintanilla de Onesimo. “Onesimo” seems an appropriate moniker for the location of a cult wine! We refer, of course, to the Dominio de Pingus.

Pingus first hit the scene in 1995 and although Robert Parker, for one, was euphoric when he first tasted it, the scores really took off around the turn of the millennium when the vineyard went biodynamic. It earned its first maximum in 2004, followed by another in 2012, and since 2000 the lowest score has been 94, in 2003. As to its ability to age, the only vintage so far designated as “mature” is the 2001, all the others being “early” or “young”.

Like all cult wines, production is tiny, amounting to a mere 500 cases, leading to almost immediate scarcity. Investors will be encouraged to learn that pricing is perfectly coherent, with the 98 pointers coming in just below £6,000 per case of 12, the 99 coming in at around £6,300, and the slightly lower scorers around the £5,000 mark.

Meanwhile the two perfect 100 point scorers show some variation, with the 2004 costing £8,800 and the 2012 coming in at nearer £12,000. Before you charge out and buy the 2004 on that basis though, remember that the secondary market for cult wines can be somewhat fickle.

At Amphora we only recommend cult wines like Pingus for collectors, for whom the investment return is a secondary consideration, or investors with much larger portfolios. If a portfolio size is less than, say, £50,000 the cost of a cult wine is going to negatively affect the risk profile because, effectively, too high a percentage of the overall value will be vested in a single constituent.

Remember though that this risk can be mitigated by buying a 3 or 6-bottle case, but if you take this route, please ensure that you are purchasing wines in OWC or banded format, so that condition and provenance can be more easily established.

Philip Staveley (pictured) is head of research at Amphora Portfolio Management. After a career in the City running emerging markets businesses for such investment banks as Merrill Lynch and Deutsche Bank he now heads up the fine wine investment research proposition at APM. www.apmwineinvestment.co.uk