Back in August I received a Press Release about Whisky valuations that has sat in my to-do folder every since. With the day job being very busy and my thoughts on investing in and collecting whisky this article has sat for while without me doing much about it.
However I spent a good part of the last few days reading over it and seeing some of the content so i've decided to publish it, along with some comments of my own (at the bottom).
The market for investing in and collecting rare whisky continues to boom, with a record number of bottles of rare whisky sold at auction in the UK during the first half of 2015, according to figures published by whisky analyst, broker and investment experts Rare Whisky 101.
The first six months of the year saw 20,638 bottles of single malt Scotch whisky sold in the UK on the open market, an increase of 5,374 bottles and a 35% increase on the same period last year.
Compared to the first half of last year, the value of collectables sold at auction grew 33.8% to £4.604m.
The continued growth of the whisky secondary market contrasts with the fortunes of the primary market where whisky exports have seen values fall over the past year.
Whisky investment analyst and co-founder of Rare Whisky 101, Andy Simpson commented: “Demand for rare whisky and the supply of bottles at auction are both accelerating at an extraordinary rate, and this is driving up values. Even using the broadest metrics of the top 1000 bottles, we have seen a dramatic and dynamic rise in values since 2008 to end June 2015.
“Demand for desirable single malt Scotch brands and previously discontinued bottles remains exceptionally strong. The dead hand of marketing is gaining an ever tighter grip on the single malt category, where retail releases are becoming non-age stated (NAS) and the number of bottles ever more prolific. The dearth of truly collectable releases over recent years has only fuelled demand for older and discontinued past releases where quality and rarity are powerful motivations for purchase.
“For many in the broader Scotch industry, export and sales figures appear challenging. However, the secondary market for rarities shows little of this stress. We view this as a clear future trend, with the value of scarcity increasing demand from connoisseurs, collectors and investors.”
Liquid gold burns brighter
The top 100 performing bottles of Investment Grade Scotch (Rare Whisky 101 Apex 100 Index) increased by 8.93% compared to the same period last year. The rising values have yielded an overall increase of 506.24% between 2008 and 31 June 2015. The Apex 250 and 1000 have recorded growth of 385.81% and 245.08% over the same time frame.
Bowmore rockets up rankings, but Balvenie takes a tumble
Leading rare whisky brands, Brora and The Dalmore, retain their positions as the top two ranked distilleries, but there has been significant movement elsewhere within the Investors Distillery Index. The biggest risers are Bowmore, up 13 places from 18 to 5, Ardbeg up 10 places from 19 to 9, and Glenfiddich which climbed 16 places to 23. Balvenie tumbled 10 places from 3 to 13.
The Rare Whisky 101 top 30 brands are:
Caveat emptor….worst performing whiskies continue to decline
Conversely, the negative indices plumbed new depths, continuing a downward negative trend. Despite producing a marginally positive performance (+0.16%) through the first half of 2014, the Negative 100 Index has experienced a significant -6.74% decline during the first half of 2015. From 2008 to the end of June 2015, the Negative 100, 250 and 1000 are down -67.84%, -60.2% and -44.12% respectively.
Japanese whisky experiencing meteoric ascent
While values for collectable single malt Scotch have made impressive gains during the first half of the year, their performance pales in comparison to some Japanese brands. Karuizawa, for example, has increased by 66.05% at the half year point, outperforming any other single malt Scotch brand.
For more information or to download the full report visit www.rarewhisky101.com
So as I pointed out at the top there's some interesting facts and figures in here and I was really shocked by some of them, not least the fact that Port Ellen was not in the Top Two and that Dalmore was.
My own favourite collectible brand, Rosebank, which I buy to drink wasn't even in the top 30 in the first half of 2014 and has risen 12 places to 21 no doubt bhoyed by the release of the 2014 Special Releases 21 year old in October/November last year which appeared very quickly afterwards at auction along with a number of The Scotch Malt Whisky Society bottlings from distillery number 25.
I think a lot of my thoughts come from a naivety about it as I don't collect or invest in bottles, so my thoughts that closed distilleries and the very obvious would be in the top positions, with my own thoughts being that it would run as :-
1. Port Ellen
5. Rosebank or St Magdelene
Oh how wrong I was; I totally did not place Dalmore in there at all, or Bowmore or Mortlach and I certainly didn't have Talisker above Rosebank which utterly blows my mind. In fact i was astonished to see Ardbeg only just inside the top ten.
As I look at these rankings I'm glad I didn't play with investing in bottles or have a fascination for collecting as honestly based on this I would have got it totally wrong. A seriously interesting look at where the money is in Whisky.
On that note, it does look like Japanese whisky is fast becoming saught after both with Karuizawa and with last years Whisky Bible naming a Yamazaki as the whisky of the year, which 5 minutes later went from a £100 bottle to a £1000 bottle.
Oh I'm glad I'm not a collecter! Do you collect or invest in Whisky? What do you make of these facts and figures, let me know in the comments below.