Syrah: great investment wines, from the Old to the New World

by Apr 22, 2020News, Wine Trading Academy0 comments

Syrah grapes picked in Montes estate in Apalta, Colchagua Valley, Chile. They are used to produce the outstanding 2011 Montes Folly Syrah that was our first Chilean IBO and is listed on our exchangeSyrah grapes picked in Montes estate in Apalta, Colchagua Valley, Chile. They are used to produce the outstanding 2011 Montes Folly Syrah that was our first Chilean IBO and is listed on our exchange

Syrah grapes picked in Montes estate in Apalta, Colchagua Valley, Chile. They are used to produce the outstanding 2011 Montes Folly Syrah that was our first Chilean IBO and is listed on our exchange

(Sergey Glekov, senior financial advisor)

Syrah is a dark-skinned red wine grape. The northern Rhône Valley of Eastern France is considered as the home of Syrah in the Old World. However, being ranked as the world’s 6th most planted grape variety, Syrah can be easily found in almost all New World wine regions such as: Chile, South Africa, Australia, New Zealand, and California.

Syrah – or Shiraz, as some may call it – produces deeply colored, full-bodied red wines with the ability to age and evolve for years or even multiple decades. The variety produces wines with a wide range of flavor notes, mainly depending on the climate. Syrah wines typically have flavors of blackberries, plums, spice, chocolate, licorice, blueberry, cassis, pepper and truffles.

Wines made from Syrah have been popular for centuries with collectors all over the world.

julien montes folly syrah 2.jpgjulien montes folly syrah 2.jpg

We decided to analyze price dynamics of Syrah wines from the Old and the New World, to compare prices of several iconic Syrah wines from Rhône Valley of Eastern France with the high-quality and age-worthy Syrah wines from Chile.

The peer group of French Syrah wines includes the following constituents:

2011 Paul Jaboulet Aine Hermitage La Chapelle, Rhone

2009 Domaine Jean-Louis Chave Hermitage, Rhone

2012 E. Guigal Cote Rotie La Landonne, Rhone

2012 Domaine Jamet Cote Rotie Cote Brune, Rhone

2009 M. Chapoutier Ermitage Le Pavillon, Rhone

2010 Delas Freres Hermitage Les Bessards, Rhone

2010 Michel & Stephane Ogier Cote Rotie La Belle Helene, Rhone

2011 Domaine Auguste Clape Cornas, Rhone

Exhibit #1 – Price dynamics of French Syrah wines peer group over last two years

glekov%2Bsyrah%2B1.jpgglekov%2Bsyrah%2B1.jpg

 

The peer group of Chilean Syrah wines includes the following constituents:

2008 Concha y Toro ‘Gravas del Maipo’ Syrah, Maipo Valley

2012 Matetic Syrah, San Antonio Valley

2011 Montes Folly Syrah, Apalta

2014 Errazuriz La Cumbre Syrah, Aconcagua Valley

Exhibit #2 – Price dynamics of Chilean Syrah wines peer group over last two years

glekov+syrah+2.jpgglekov+syrah+2.jpg

 

The average returns of Syrah wines from France tend to outperform the average returns of Chilean Syrah wines.

However, there is an exclusion – Montes Folly Syrah, precisely, 2011 Montes Folly Syrah.

Average retail prices of 2011 Montes Folly Syrah have demonstrated a growth of around 20% (in euro) over the last two years which is almost the same as performance of 2009 Domaine Jean-Louis Chave Hermitage, Rhone, the best French Syrah wines from our peer group in terms of price growth.

Exhibit #3 – Syrah wines: The New World vs the Old World

glekov+syrah+3.jpgglekov+syrah+3.jpg

 

Montes vineyards were founded in 1988 by Aurelio Montes, Douglas Murray, Alfredo Vidaurre and Pedro Grand, with the aim of producing high-quality Chilean wine.

Montes Folly is one of the most remarkable wines in the company’s portfolio. Montes Folly is a wine of exceptional quality that has been recognized as the best Syrah of Chile.

Its grapes are grown on the steepest, highest slopes of our vineyards in Apalta, Colchagua Valley. For that reason, they deliver more color, tannins, and flavors, making Montes Folly richly complex and powerful.

An average retail price of 450 euro makes 2009 Domaine Jean-Louis Chave Hermitage, Rhone one of the most expensive Syrah in the world. Therefore, with a current price of 90 euros, the long-term investment potential of 2011 Montes Folly Syrah seems to be outstanding.

***

More on Syrah:

You can also invest in one of the last bottles of M. CHAPOUTIER “LE PAVILLON” Rouge BIO 2009 directly on our exchange.

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