Macallan 18 Values Soften and Diageo Silent-Still Heavyweights Dip Amid a Mixed Start to the Year.
The first two months of 2017 have been something of a mixed bag for whisky values. There was always a certain air of inevitability around a re-trace of Macallan 18 year olds following 2016’s rapid gains. The vintage 18’s older Anniversary Malt siblings, however, continue to climb.
Following 2016’s emerging trend, the market seemingly continues to de-value the scarcity of silent stills – Values for both the Port Ellen Index and the Brora Index have fallen in February with significant volatility continuing, if not increasing across both indices. On a year to date basis, the Brora index is the worst performing of the key indices.
February was also the first month to see a year-on-year decline in the number of bottles hitting auction in the UK. February 2016 saw 5,360 bottles of Scotch sold at auction in the UK where February 2017 saw 4,980. Worthy of note is Scotch Whisky Auctions held their first 0% sellers commission auction back in Feb 2016, so there was a correspondingly huge increase in volumes from the Glasgow auctioneers.
Whereas year on year volumes declined by -7.09% it was a very different story for overall values. Again, comparing February 2016 to February 2017, the £ value hitting the open market increased by 31.06% from £1,131,512 to £1,482,991. This is to be fully expected noting the quantum shift in prices through 2016.
The key Rare Whisky 101 indices ranked in order of performance for February and also year to date are –
The broadest measure of the market, the Apex1000 Index, highlights continued positivity with the holistic picture showing good upside… >2% gains have been experienced in both January and February. The Rare Malts Selection Index looks to be experiencing accelerating growth. The Rare Malts had a great 2016 with early 2017 results suggesting this cult collectible series has further to climb.
The Vintage 50 Index also highlights the growth in interest for significantly aged, vastly rare Scotch with it’s second highest monthly increase in over three years. This months result was only bettered by a 5.82% increase in September 2016.
Despite a softening of Macallan 18 values, the ‘M’ distillery still leads the pack with the vintage Anniversary Malts advancing. Looking at the indices side by side shows they’re almost on par again with the Macallan 18 index standing at 553.82 and the Macallan 25 index at 538.55.
Port Ellen and Brora show exceptional peaks and troughs across both indices. This suggests both are being governed by the collectors market. We typically see a spike as a collector is missing one or two releases from a full ‘set’, thereafter the market returns to normality. Despite the inherent spiky nature of these indices, the general trend does still remain positive.
To some degree it will also be important to see what Diageo do with pricing for the 2017 release of Port Ellen and Brora (if, indeed there is one). On the secondary market, the trend seems to be the more retail prices are inflated, the more volatility creeps into the market. 2016’s Port Ellen Special Release saw relative retail price stability; so we find ourselves asking if the retail ask price is increased this year, how far will/can it go before the normal dynamics of the market simply snap and consumers walk away?
Elsewhere in the market, it’s fantastic to see London-based Whisky.Auction manage to bust a substantial haul of fake whisky. For those interested and/or invested in the secondary market for rare whisky this issue will become ever more prolific with prices at all-time highs. If there’s one person producing fakes in the UK, there’s a terrible certainty more will be doing the same.
In summary, for the early part of the year, from a collecting perspective, It’s fascinating to see silent stills moving out of the limelight in favour of producing distilleries. Will this trend continue or has the market simply paused for breath, thus providing a good time to acquire any remaining bottles from silent stills? Rarity certainly suggests buying up remaining bottles from silent stills, but, in some cases is liquid quality letting the team down? … A polarising start to the year.
In our first rare whisky review of 2017, what we’re seeing is continuation.
That might sound a little dull… continuation suggests nothing’s changing, the status quo remains the same. To some degree that’s right, however, what we’re seeing in early 2017 is far from boring. Two things at this early stage of the year –
One – there looks to be little slowing in the increase in values for the right bottles.
Two – the number of fakes in the market is increasing.
Looking to Scotch Whisky Auctions, we saw a new record for the third release of Black Bowmore. £7,400 sealed the bidding at £400 ahead of Bonham’s previous December 2016 high. Looking back just under twelve months and the price was £5,150. Take it back to February 2014 and the price for this bottle was £3,500. Amazingly in 2008, these were selling for £1,400.
This buoyancy provided ample opportunity to re-run the Black Bowmore Index which we last published in August 2015; some eighteen months ago when the index stood at 294.25. That was impressive enough, however, we’ve seen a further 57.14% increase since then, with the index now standing at 462.39.
From a monetary perspective, the £ cost of the three first releases of Black Bowmore at the start of the index in 2008 was £4,520. That cost has now risen to £20,900. Last years release of the 50-year-old Black Bowmore completes an impressive five-bottle set. Values should remain buoyant for these in-demand rarities. Noting there can only ever be a maximum of 159 full sets of five bottles (159 bottles of the 50 were released), expect fireworks if all five ever make it to auction as a collection. The fourth Black Bowmore also set two record sales in February; Just-Whisky pipped Whisky-Online Auctions by a fractional £25 to take the highest price paid to £10,125.
Not wanting to leave White and Gold Bowmore’s out, Whisky-Online Auctions sold a bottle of each earlier this month for an equal £6,100 per bottle – both new record prices.
Assuming the full £16,000 retail price is paid for a 50-year-old Black Bowmore, all seven bottles of the-colours-of-Bowmore collection would cost £59,225. Bargain!!?
Another high value set/collection taking recent glory is Macallan’s Lalique decanter set. The sixth and final pillar, or decanter, was released last year. So, as with Black Bowmore, this particular collection of Macallan in Lalique is now consigned to history. For completeness, the list of the six pillars in Lalique are –
The Macallan in Lalique – Exceptional Oak Cask, 50 Years Old
The Macallan in Lalique – Natural Colour, 55 Years Old
The Macallan in Lalique – Finest Cut, 57 Years Old
The Macallan in Lalique – Curiously Small Stills, 60 Years Old
The Macallan in Lalique – Spiritual Home, 62 Years Old
The Macallan in Lalique – Peerless Spirit, 65 Years Old
Not content with selling the most expensive bottle of whisky sold at a UK auction last year, London-based Whisky.Auction now hold the title for selling the most expensive bottle of Macallan sold at auction in the UK. £41,000 was the magic number required to secure a second release Lalique decanter. Having been up close and personal to a few of these in my time, I might suggest that the postage would possibly cost as much as the bottle!
It’ll be fascinating to see what the full set of Lalique’s (pictured below) sell for on the 2nd of April at Sotheby’s in Hong Kong. The set (in a Lalique made cabinet with some F&R mini’s for good luck) is the only one in the world released by the distillery, so with enough avid (should that be rabid!) Macallan collectors out there, I don’t think the HK$2,000,000 – HK$4,000,000 (£207k – £414k) estimate will be too much of a challenge. In fact, I’d be very surprised if the upper estimate isn’t burst by a significant margin.
Bowmore and Macallan had great months, but elsewhere some exceptional bottles sold for correspondingly exceptional prices –
Recently, Springbank seem to be getting the attention they rightly deserve for rarer examples. A long discontinued bottle of 12-year-old 100 proof managed a phenomenal £1,300 at Scotch Whisky Auctions – exactly ten times the £130 price-tag it was selling for in 2008.
Just-Whisky took a bottle of Glenmorangie 30-year-old Oloroso through £1,000 for the first time when one sold for £1,030. As recently as June 2012 these could still be picked up at auction for sub £200.
Moving onto the second issue, we’re still seeing an increase in fakes on the market. Our view is still very clear on this, as values remain so buoyant, we will see an increase in the number of fakes.
We were speaking to fellow fake-haters, Scotch Whisky Auctions, today as some fakes had slipped through their (very tight to be fair) fake-net. The two blue label Macallan 30’s were a point of discussion as one was 100% fake, the other we’re 99% sure is fake (that’s sometimes the issue with imagery, we’d need to see the bottle to be 100% sure).
There was also a really good (by that I mean hard to spot) fake Macallan 1979 Gran Reserva as well. Between the blue label 30 and the Gran Reserva’s (we’ve seen ALL vintages of these faked) these are among the most faked, high risk bottles out there… and they’re not cheap so we’re not expecting this flow of fakes to be stemmed anytime soon.
It’s great to see that Scotch Whisky Auctions are taking an even tougher stance on fakes and are now barring sellers who are repeat and deliberate offenders. Clearly Scotch Whisky Auctions have done/are doing the right thing for their buyers too by refunding payments and taking bottles back.
The interesting thing is that all these bottles sold for their current market value, so there’s a real education piece required to help buyers understand how to spot these things. But there-in lies the conundrum – if everyone knows how to spot fakes, fakers will correct these errors and get better.
That said, we’ll be doing a lot more on this with many others later in the year. More on that later.
In summary, fakes aside, the start to 2017 looks positive. We’re certainly not expecting a mirror image of the gains seen in 2016 but demand still seems to be vastly more than supply can provide for. Early days yet and there’s still plenty of time for the arrows to start pointing down but we’re not seeing significant stress in the market for now. Cautious optimism is the phrase of the month here.
Andy and David.
Bowmore imagery courtesy of Whisky-Online Auctions other than the 50 yr old.
Macallan Lalique set image courtesy of Macallan.
Glenmorangie image courtesy of Just-Whisky.
Blue label Macallan 30’s image courtesy of Scotch Whisky Auctions.
Whisky Values Maintain Buoyancy as Port Ellen Leads the Pack in November.
Demand for rare whisky increases as November’s results show prices hardening amid an almost insatiable market.
Volumes were relatively stable at 5,352 compared to October’s 5,528 and average prices for Scotch look to be edging further north towards the end of the year. More on averages in the 2016 Investment Review released early 2017.
Other than the specific negative indices which track the worst performing bottles, every single key index finished the month in positive territory. As more confirmation certain brands/bottles continue to fall, the Negative100 index slid further into the red, losing 1.43%; its greatest single month dip since Mays -7.46% loss.
The basic principles of the current dynamic market remain broadly the same as they did five years ago with the most desirable bottles increasing and polarisation suppressing values for undesirables.
Bottle(s) of the Month
When gems from Springbank infrequently appear on the open market there’s usually a decent amount of activity. Over the past year or so, demand for some of these magnificent older examples has dialed up to eleven.
Born in 1963, this Cadenheads 31-year-old has only appeared on the market three times. Scant surprise then, when Whisky-Online Auctions unearthed one, it rapidly disappeared into the stratosphere from a pricing perspective.
From £320 in 2010 to its current price of £2,150 represents a 572% increase in value.
Rather more frequently seen on the open market, the blue label Macallan 30-year-old managed a new record of £3,500.
With a 2008 record low of £260, this bottle is one of the all-time best performers at auction yielding a 1,246% increase in value.
The Month in Summary
The key Rare Whisky 101 indices ranked in order of performance for November are –
Port Ellen (OB) prices continue along their unpredictable peak/trough sawblade-esque trajectory. Down 15.85% in October then bouncing back in November to increase 16.46%. A 2016 year to date result of +38.19% shows the general trend is still very much up.
As the third greatest gainer in November, Karuizawa appears back on the radar. Novembers increase takes Karuizawa out of the red for 2016 and gives a marginal year to date positive performance of 6.01%.
And then there was Macallan!
The current surge in values is so out of line with anything we’ve ever seen before. We still maintain this market is unsustainable. That said, every month we seem to keep witnessing further increases, especially to the vintage 18-year-old bottlings.
To illustrate how unique the current market is, if we forecast forward the average per-bottle price increases for both 18 and 25-year-old Macallan’s, we see the 18-year old’s becoming worth the same as the 25 year olds in just over one year, with an average per-bottle price of just under £4,000.
Now, while the current increases look almost incredible, an average of £4,000 per bottle would be madness… but with the current trajectories, that’s how out of line the current market really is.
With one more month before the curtain is closed on 2016, it looks like this year will be a record breaker. While there’s still time to see a year-end dip similar to that of 2014, we would see it as unlikely any dip could/would be significantly material… more a pause for breath. The current market just looks too bullish at the moment with demand for rare whisky remaining nothing short of exceptional.
October saw the second highest month on record from a supply perspective with 5,528 bottles of Single Malt Scotch hitting the secondary market in the UK, slightly behind August’s all-time high of 5,707. It’s incredible to think the number of bottles sold in one single month is now regularly exceeding 2010’s full year supply of 5,431.
From a pure investment perspective, October looks to have finally flushed through any Brexit forex related gains. The broadest measuring index, the Apex1000, increased by 2.20% in October, cooling from September’s 5.30% and August’s heady 6.18%.
While there’s clearly been the expected positive correlation between Sterling’s drop and certain bottles increasing, the broad market has remained underpinned by the same tried and tested principles. The ‘right’ bottles are increasing and the ‘wrong’ bottles are still languishing in the doldrums. The impact of the crash in GBP has by no means positively affected all prices; the value of some bottles has continued to fall.
Bottle(s) of the Month
October’s highlights have to include Scotch Whisky Auctions Rare Malts Selection Brora 1972 22 year old which, in-spite of massive increases already, pushed up from its previous £5,400 record to a massive £6,400. The profile of that little gem is below.
Whisky-Online Auctions took a bottle of the Largiemeanoch Bowmore 1967 from its previous best of £8,200 to £10,300. Demand for these amazing old rarities seemingly knows no bounds as the valuation history below shows.
The Month in Summary
October proved to be a particularly sharp, double edged sword as Macallan continued to surge but both Brora and Port Ellen dipped dramatically. Both indices saw large peaks over earlier months which have now been erased.
The monthly % changes of the indices are ranked below together with the respective 2016 year to date results-
It’s the first time we’ve ever seen an index/collection double in value over the course of less than one year. The vintage Macallan 18 year olds have outstripped everything before them. Even the rapid ascent of Karuizawa prices in early / mid 2015 can’t hold a light to Macallan. As a word of caution, and as can be seen from the charts, these bottles have been through a protracted re-trace before. Whether we see any sort of cooling in rare Macallan prices is anyone’s guess; but we’re absolutely not expecting these gains to continue. They simply cannot.
While not included in the ranking above, the Negative1000 index crept slightly further into the red, cementing the risks involved in selecting the wrong bottles.
Port Ellen and Brora are also showing why Scotch should be viewed as a medium to long term investment. With peaks and troughs galore, as ever, timing is everything.
We finished the last rare whisky review with the following statement – “…Although in the current market, a bargain seems increasingly unlikely”. A statement which currently resonates through the very fabric of the rare whisky auction market.
Never before have we witnessed such fevered buying at almost any price for rarities from high demand brands. We’re going to be taking an in-depth look at Macallan in our 2016 full year report in around four months’ time but the vintage 18 year olds look like they will have virtually doubled in value throughout 2016. We just haven’t seen anything like this type of growth before.
That said, there’s plenty of time for 2016 to unleash a nasty sting, we saw that in 2014 and (we’re assuming) with the vast majority of the forex related gains under our belts, things could ease in the final quarter of 2016. As, when, and indeed, if we see that happen we’ll report it, however, until then, we’re looking at an exceptionally positive landscape for the world of rare whisky…
Big Brand Demand
With a scant 77 bottles released a few years ago, Dalmore’s Candela has taken its time to increase in value until it breached £10,000 in 2014. Prior to that, it was hovering around the £6,000 – £8,000 price point for years. Dalmore gets a bit of a bashing occasionally – we hear things like “the price has been Dalmorized” when something might be a little racy in the bang for your buck department… or “it’s just got a load of the black sludge in it” (meaning e150a colouring) and there might, who knows (certainly not us), be an element of truth in there somewhere. But one thing’s for certain, old Dalmore’s just a thing of wonder. Be it an older bottling such as the late 1950’s distilled twenty-year-old bottled in 1978 or an old aged liquid like Candela, these things are fabulous to drink… and clearly collect. Two bottles of Candela hit the market earlier this month at Scotch Whisky Auctions and Whisky-Online Auctions. The respective hammer prices were £15,000 and £14,600; both comfortably exceeding Bonhams previous £13,000 record set earlier this year.
Scotch Whisky Auctions continued to roll out the big guns and the records fell. A 1937 50 year old Balvenie managed £15,000. In August 2010, I remember bidding on two of these at Bonhams in Edinburgh. I was bidding against my arch-auction-nemesis from Italy who has particularly deep pockets, so I bailed out and lost the bottles for £3,600 and £3,800. Maybe I should have pushed further.
£8,400 took a bottle of Macallan 1946 Select Reserve to a new record, edging past its previous best of £7,600.
If we index these three bottles to take a look at their combined growth, as is common with high value rarities, we see periods of stability (where there are no sales due to simple scarcity) followed by significant positive step changes. A 300% increase in value since December 2008 is very impressive.
Scotch performed admirably, but Japan needs to feature too. The two big Japanese bottles at SWA were the 35-year-old Yamazaki which, at £16,000, was not just the most expensive bottle of the auction, it was the most expensive bottle of the month. Not quite in the ‘Yama-35’ league but the 2013 Yamazaki Sherry Cask fetched a whopping £3,600. Look back at early 2014 and these were selling for around £100 per bottle… then a man in a hat with scary eyes wrote nice things about it and BOOM! Madness.
Port Ellen Prowess
Taking a quick look at the first eight official Port Ellen releases and we see every bottle closing out September with a value in excess of £1,000. It’s the first time that’s happened so we’re expecting to see significant gains in the Port Ellen index when it’s published tomorrow.
The First release seems to have reached a (temporary?) glass ceiling of £2,200 with the other releases playing catch up. Whisky Auctioneer took the 3rd, 6th and 7th releases to £1,300 per bottle; all new record prices for these bottles and the first time the 7th release has pushed through the £1k barrier.
£4,300 for 12-Year-old Scotch
Desirable bottle of the month from a personal perspective has to go to the Whisky-Online Auctions bottle of 12-year-old Laphroaig at 80 proof by Cadenheads. At £4,300 it was no-where near the most expensive bottle of the auction, but it was a new record price for the bottle and marks this as the fourth most expensive 12-year-old on record. The most expensive 12-year-old is the £12,100 (which has also sold for £7,600, £5,000 and £4,800) Port Ellen Queens Visit, followed by £8,200 for both the James MacArthur’s cask strength Port Ellen and the Bowmore Lagiemeanoch 1967 12-year-old.
Caution Still Required in Bullish Market
While the current market looks exceptional, it is still possible to buy the wrong bottles. In 2013 a bottle of SMWS bottled Tomintoul, cask 89.1, sold for £500. Earlier this year, a bottle managed just £155. That’s a 69% hammer price to hammer price, buy/sell loss… add in auctioneers’ commissions and the loss is a punishing 78%.
Get it wrong, and like any investment, you can lose your shirt.
Retail Releases – Diageo Special Release Analysis
The big one this month is the Diageo Special Releases. All bottles and prices for the 2016 release can be seen here. As we had to politely decline attending the tasting this year, we’re not in a position of knowledge with this years releases. If we do get to try them, we’ll post up our thoughts on quality vs price.
It’s interesting to look at what these bottles represent now they’re in their 16th year. Put pricing aside and they are probably the most eagerly anticipated new releases on the Scotch calendar. The 2001 first annual releases numbered just three products – Two Talisker’s and the aforementioned Port Ellen 1st release. Bringing it right up to date, including 2016’s releases, there have been 143 different products. That’d be some collection in its own right.
The profile below shows what distilleries have been bottled in what years.
Interesting to see there are still five operational distilleries with no special release – Blair Athol, Glenlossie, Inchgower, Roseisle and Teaninich are devoid of an annual release. Surely we have to see something from Roseisle? If we don’t see any releases from the other four, I don’t think many people would lose that much sleep over it to be fair.
We can see grain featuring more frequently now as Cambus, Port Dundas and Caledonian have all been released. Might we see a Cameron Bridge? North British would be unlikely as it’s a joint venture with fellow distillers Edrington.
Noting the amount of time since their closure, if I were a betting man, it looks unlikely that we’ll see anything much from Diageo’s many silent distilleries other than Port Ellen, Brora and Rosebank possibly (but for how long?). Could we now start to assume that the brand owner is out? Quality probably wasn’t there with any remaining stocks so the last few casks have been blended away? It looks probable. At the end of the day, Diageo are a blending company, so it makes sense anything from a sub-optimal-single-malt perspective has been used in a blend.
The 1995 to 2005 Rare Malts Selection releases featured many of the more obscure silent stills – Glenlochy, Banff, Glen Albyn, Millburn, Glen Mhor and Hillside (Glenesk) featured. Can we now assume they were to be the final OB’s from these lost distilleries?
That circles me nicely back to the importance of the secondary market. If you must have an official bottle(s) from many of these silent stills, it’s looking more and more like auction will be the only way to get them. As knowledge/awareness of whisky auctions builds among the ever growing number of connoisseurs, collectors and investors, the secondary market looks set to grow… as do prices.
When we finally close out August, we’ll have seen one of the largest (if not the single largest) open market volume months ever. Supply has been astounding, not just with three thousand bottles of whatever Ardbeg released on their last ‘day’, but with some massive malts; many of the kings of collectables emerged, and boy did they fly. We’re primarily going to focus on just two iconic collectors distilleries this month.
Bowmore and Macallan.
Starting with Bowmore; we’re witnessing some exceptional increases in value for certain bottles from this classic collectors distillery. Currency fluctuations can be held responsible for an element of these increases; however, before the significant weakening of Sterling, we had already witnessed exceptional buoyancy in the rare whisky market despite any forex related movement.
Whisky-Online Auctions (W-OA) started August with a record price for the 1955 40 year old. Always re-assuringly expensive, even as far back as 2008 these were selling for over £3,000. £6,200 took the bottle on this occasion. London based Whisky.Auction took a 30 year old ‘Sea Dragon’ ceramic to £1,550, just surpassing its previous best of £1,500. Crazy to think that even as recently as 2011 these sea dragon ceramics could be bought at auction for around £250.
Turning to Whisky Auctioneer and a bottle of White Bowmore managed a superb £5,100, way past its 2012 low-point of £1,700. Whisky Auctioneer also took a bottle of the 1965 vintage ‘Premier Range’ to £6,100; exactly £1,000 past its previous best of £5,100.
At the slightly less racy end of the market, also at Whisky Auctioneer, two bottles of the 1984 ‘Vintage Distillation’ sold for £312 (another sold for £271) a clear record for this bottle. This bottle was selling for £60 in 2012, therefore crystallising a four year gain of 420%.
Scotch Whisky Auctions August sale further illustrated the stiff demand for Bowmore. One of the 70cl variant bottles of the 1964 38 year old Bourbon Cask bottling achieved £4,300, comfortably exceeding a previous best of £3,600. The exceptionally rare Fecchio & Frassa Bicentenary bottle at 98.8 proof managed £2,800, £300 past its previous best.
As one of the classic-collectable distilleries, Bowmore rarities will inevitably remain sought after and August prices have confirmed that. But moving away from Islay and onto the mainland we find a distillery which is not just a ‘classic-collectable’ but arguably the king of collectables – Macallan had some stunning performances this month.
Scotch Whisky Auctions took a bottle of Private eye to £2,100.
I remember complaining bitterly at paying a hefty (it was then) £260 price-tag for a bottle some years ago but that seems almost a moot price-point now. I know I’ve mentioned this previously but I still find it incredible these originally retailed for £35 in 1996. The mini’s were even given away free with bottles of 10 year old at one point. Long gone are those days.
Virtually every vintage 18 year old bottling is now becoming a prize for the wealthy drinker/collector/investor. Prices are continuing to march north at a rapid pace. We do fear there will be a cooling at some point so unless these are being bought to drink, we urge extreme caution if buying at todays heated prices as an investment. Gap filling a collection? We completely understand that, but prices are looking ‘toppy’ right now.
Whisky Auctioneer sold a 1969 vintage 18 year old for £1,600 and the 1976’s are now around the £1,150 mark. For the first time, more than £1,000 was paid for the 1978 and 1979 vintages.
Just-Whisky brought some incredible bottles to market in their August sale. Little more than a week had passed since Whisky Auctioneer set a new £16,300 record for the 1949 vintage Millennium decanter when Just-whisky moved one for £17,675.
When you next see my Co-Director, David, be sure and ask him about the time his very generous wife accidentally made what is possibly the worlds most expensive trifle with the Macallan Millennium liquid…
This month is to remain dominated by Bowmore and Macallan, however there are a couple of other record prices which can’t go without mention. Scotch Whisky Auctions £13,000 price for a bottle of Dalmore 1926 50 year old and what is surely the most expensive 20cl baby-bottle ever… A 20 cl variant Mortlach 70 year old by Gordon and MacPhail rocketed to £12,000…
I can’t help but wonder if the buyer in some way misread it and thought they were getting a full-sized bottle for a bargain.
Although in the current market, “a bargain” seems increasingly unlikely…
Your Mission – Create flavours never tasted before in Scotch….
Andy to David – “What would happen if we drew inspiration from the craft brewers and made spirits?”
David – “No, idea, let’s find out!”
Research – we both love Glenmorangie Signet (good research!) – a weird, flavoursome single malt, an alcohol infused tiramisu with espresso coffee notes….wow. Spoke to Dr Bill and we hatched a plan.
Met Simpsons malt and chewed an amazing range of “speciality malts” and could not believe the range of flavours and textures, so we set out to further understand the impact of speciality malt flavour on new make spirit.
The Controls – 100% Golden Promise, 4 yeasts – 2 brewers and 2 cultured.
The Wood – 12 amazing sherry butts from Tevasa Cooperage – the same supplier I used at Macallan back in the 1990s.
It boasts a perfectly formed small lauter tun, 4 easy to keep clean stainless steel fermenters and 2 magical copper pot stills. A way to keep each and every mash separate from the next using a range of transit tanks, allowing us to collect low wines, foreshots, spirit and feints from every single mash and fill 1 cask from 1 mash. Perfect control, perfectly discreet, perfectly simple.
But most importantly, a team of talented, helpful and innovative people – Liam, Dr Jack, Lok and Freddy.
The plan was hatched!
The Recipes – what mix should we use? Can we go 100% speciality malt? Will it mash okay? Will it ferment? Will it distil? Will it yield any alcohol?
Back to first principles – we worked with Tim McCreath at Simpsons Malt and did some lab scale analysis of various speciality malts recipes.
Lab PSY (predicted spirit yields) ranged from 7.3 litres of pure alcohol per tonne to 397.5. Wow, what a massive spread!
Distillers today typically return a yield of 410-425 litres of alcohol per tonne….but are they creating flavour?
Costs – of course this needs to be factored in. The speciality malts are much more expensive that traditional distilling malts. Plus, we were buying in tiny batches. More cost!
Writing up every aspect of recipe and distillation could take forever, so we will share information in general terms. We bought crushed (already milled) malt from Simpsons and we paid anywhere from £600 to £750 per tonne. Imagine paying £750 per tonne to yield 7 litres of alcohol! A pretty expensive exercise….
How about recipe planning? Again we sought a collaborative approach and organised a planning session (in the pub) with the Glasgow distillers and we each picked a recipe we felt would or could work to deliver relatively easy processing, reasonable yields and maximum flavour.
The plan was hatched and agreed and we asked Simpsons to confirm the PSY by conducting lab scale mashing and analysis.
So, we had a plan and an indication of likely yields – ranging from a low of around 296 l/t to 397 l/t – a huge range in yield and hopefully a huge range in flavour impact. Would inclusion of speciality malts deliver the flavour impact we craved? Or would the fermenting and distilling process strip out and lose all the character we sought?
Processing – we agreed to follow the classic 3 water mash.
Strike 68C to get 64C at the spout to activate enzymes and convert starches/large sugars to fermentable sugars.
Rest briefly, balance to underback, vorlauf (or recycle weak worts) and then pump to FVs and cool worts to 20C.
Add our 4 yeasts – 2 dried culture yeasts (AB Mauri Pinnacle and SAFWhiskyM1) and two fresh brewers yeasts (A top fermenter and a bottom fermenter) with the aim of creating true complexity!
And start the fermentation ASAP.
Sparge on the second water, drain, cool and collect in FV, sparge on the third water and collect in heating tank for next mash (although we didn’t do that for every mash!).
Our Original Gravities (Ogs) ranged from 1047 to 1055 – low by many of today’s standards.
We fermented to achieve maximum conversion of sugars to alcohol and this ranged from 70 to 112 hours before sending to the wash still.
Our final gravities were hugely variable and a correlation (as expected) was found between mashes with no or low levels of speciality malts fermenting well versus high speciality malt inclusions fermenting less well.
Alcohol strengths at many large and efficient malt distilleries today can range from 8 to over 10%. Our trials yielded a range of 5 to 8%! Poor for yield efficiency, but hopefully great for flavour!
Distilling – The alchemy bit!
We typically collected some 5,000 litres of worts per fermentation, fermented for around 4 days and then split the FV in half to give 2 wash still charges.
So, across the course of our 24 wash distillations our initial running strengths varied from the mid 40%s to the mid-60%s.
Our low wines average strengths ranged from 15.7% to 22% – again a huge range, which correlates perfectly with the mashing recipes we have used. Most distillers today would have very consistent low wines abvs between 22 and 26%. After all, they are looking for consistency of production and are aiming to make the same low wines and same spirit day in day out. They are new-make factories. We are not. We celebrate diversity in the pursuit of a range of flavours.
By using Glasgow Distillery Company we were able to keep each run discreet and store them in 1T transit tanks. This allowed us to control, manage and monitor each and every mash, and finally fill all the new make spirit (NMS) in a single butt from a single mash.
Each run (1/2 a mash) typically gave us around 130 Litres of Alcohol (LOA) to 180 LOA per run. Our flow rates were deliberately very slow and ranged from 1.2 litre per min to 3.2 l/min! This was collected and used to charge the spirit still.
As this was a discreet experiment, we did not want any recycled liquids from any previous GDC runs. This meant we needed to ‘build up’ our foreshots and feints until we had a better ‘balanced’ system where our spirit still charges could become more consistent.
We needed to collect and build up our low wines, foreshots and feints to give enough charge liquid for our spirit still processing. This is where it all started to get critical. Could we recover the flavour created from our speciality malts? Distillation is, by its very nature, a simple process to purify the feed stock material. Collect what you want and throw away what you don’t. After much time at Diageo and The Macallan I am a fan of small stills and slow distillation and a very narrow spirit cut to concentrate the fruity, estery notes – but would this work for rich, chocolate malty flavours?
So, the detail of our spirit distillations – when we went on to spirit and then off spirit to collect the ‘heart of the run’. This clearly shows the feints build up in our first 2 mashes and 4 spirit runs – 1a, 1b, 2a, 2b – until, we reached a ‘steady and balanced’ state. The variation in ‘on spirit”’ from mashes 3 to 12 show the impact higher or weaker washes from fermentation can have.
Focusing now on the average spirit strength we can again see the feints build up required until we got a more steady state and consistent spirit cut average around 72% abv +/- 1%.
To illustrate the point more fully we have looked at the quantity of both the ‘litres of pure alcohol – or LPA’ – and the ‘bulk spirit’ created from each of the 24 spirit distillations.
And finally, the rate of distillation. As discussed previously we wanted a very slow, even, gentle boil to ensure good reflux and a balanced recovery of the purest and most flavoursome characters from these experimental batches. We believe this to be the slowest spirit cut in the Scotch whisky industry.
And so to wood. What wood? Well, given my experience and the richness of our expected new make spirit we opted for first fill Spanish oak ex Sherry butts from Tevasa cooperage, seasoned with wines from Gonzalez Byass in Jerez de la Frontera.
A full load of over 50 mighty 500 litres butts were sourced, delivered to Glasgow and nosed, with RW101 picking 12 for our bespoke distilling project.
We were looking for select casks that offered up aromas of rich dried fruits, spicy tannins (clove, cinnamon, nutmeg, ginger), orange zest and toffee sweetness.
But back to the spirit, the essence of what we were after. What was it like?
Clearly we have recovered a range of amazing characters in our spirit. We have the classic fruity notes as would be expected from 100% distilling malt – fruits, apples, pears, maltiness and nutty.
But even more exciting we have captured notes of chocolate, biscuity, toffee, nutty, golden syrup, roasted coffee, honey.
So, what happens next? We wait….and wait. And draw samples every 6 months to assess progress. Will we lose the speciality malt characters we have worked so hard to preserve? Will the wood dominate and hide those flavours? Will there be a symbiotic relationship and the wood and chocolatey notes support and enhance each other? Will things change to create new flavours? Will we lose fruit and gain spice? Will we create the world’s first ‘chocolate orange’ single malt? Only time will tell! We will report back soon…..
July saw Macallan’s 55 year old Lalique decanter set a new UK record price for the whole brand. Whisky-Online Auctions took a mighty £25,100 for this 55 year old ‘Macallan in Lalique’ second release. Back in 2010, the price of this was £5,400. As recently as 2012 one sold for £7,800. As the sixth and final Lalique decanter has now been announced and this series is complete, we should expect values to remain firm. This is also the most expensive bottle at auction in the UK since the £27,200 Springbank 1919 which sold in March 2015 (again by heavyweight price-busters Whisky-Online Auctions).
Laphroaig’s 30 year old Cairdeas managed £1,200, it’s first time through the £1,000 price point. With a 2010 record low of £345, this is further evidence that older age statements remain in exceptionally strong demand.
A few days earlier, Scotch Whisky Auctions took a bottle of 50 year old Glenury Royal to a new record of £4,300. Until as recently as 2012, this Diageo Special Release had failed to top £1,000; a seemingly distant price in light of the current market. The last twelve UK auction sales are listed under the image and, while somewhat spiky, the trend is very definitely going one way.
That up-trend continues across most silent stills with values towards the top end or above recent trade. While short term gains are imminently possible, especially in today’s market, we still maintain whisky should be viewed as a 10 to 20 year investment. Scotch Whisky Auctions £500 hammer price for a 1966 Connoisseurs Choice 20 year old showed that 100% gains are achievable in one year! May 2015 saw this bottle fetch £250, exactly half of its sale value earlier this month. Amazing.
Lagavulin’s first 21 year old 2007 Special Release managed to achieve a new record of £920. This could make the £800 ask for the new 25 year old, soon to be released, 200th anniversary bottle look like good value providing the liquid is exemplary. Just don’t expect overnight gains, it’s taken the 21 year old almost ten years to get to this level.
McTears haven’t featured heavily in these pages recently, but their July auction had one particular star performer. The second 1994 release (not the first release as originally mentioned) of the original Black Bowmore’s managed a tremendous £6,000 on the nose. Its previous best was £4,800 earlier this year and in 2010 it was still selling for £1,600. This highlights the almost mythical allure these bottles conjure among admirers. Charting the performance of the first three Black Bowmore releases over just the last three years shows a 97.7% increase in value.
Throughout the vast, frequently eclectic, world of whisky, there have been certain constants. Reminders that no-matter what else is going on there are some things you can turn to in wide eyed expectation and get a warm fuzzy feeling. Lagavulin 16 year old is one of those things, the consistently great Aberlour A’Bunadh is another and Macallan 18 year old carrying a vintage year of distillation is another.
Since the 1983 bottling of the 1965 vintage, the Macallan 18 year old was to become one of the most spectacularly sought after vintage vertical collections. Prior to the inception of the 18 year old as part of Macallan’s core offering, the often referred to ‘gold label’ bottles can be sourced all the way back to 1940’s vintages.
These vintages are one of the most extensive historical lenses to how a brand has changed in both its flavour and it image over the last fifty or so years. Birthday’s, death-day’s, weddings anniversaries and more special occasions than one can shake an Elchies Estate stick at have been marked by these iconic bottles.
… But no more.
2015 saw the final ‘vintage’ Macallan 18. That was the 1997 (technically still not a single vintage but we’ll let that slide for posterity). From this year many will have already noticed a change. Date distilled now becomes year of release. This in effect leaves an 18 year gap where no special occasions can be referenced by date (1998 – 2015 inclusive). This subtle change sees the vintage-stated Macallan 18 year olds pass into history…
So this –
Becomes this –
Interestingly, the death of this longstanding vintage vertical brings with it certain opportunities for collectors. Firstly, make sure the final 1997 vintage is snapped up if a full collection is the aim. Secondly, now vintage bottles are dead, prices should start to move for the more recent purple box variants when stagnation has previously been the trend. Couple the cessation of one bottling type with the fact that 2016 is the first ‘Annual Release’ 18 year old and we all know what happens to first release prices. A real shame, and the end of an era on one hand, but an exciting annual release programme on the other.
As the rare whisky auction market in the UK has exploded over recent years, it’s become increasingly challenging to regularly feature coverage for each auction-house. We’ve taken the decision to produce a more holistic rare whisky review rather than a weekly auction watch featuring just one auction-house. While we plan on focussing on the secondary market, we’ll also feature important primary market releases and our opinion on pricing, value and market impact too.
We’ll ultimately be producing fewer reports but we hope our readers continue to enjoy our market commentary. We welcome feedback, suggestions and recommendations for future content.
Secondary Market – June 2016
Macallan are experiencing a sea-change in both demand and pricing for their, among others, classic 18 and 25 year olds. The increases through 2016 have been utterly mesmerising; almost unlike anything we’ve seen before. The 18 year olds have seen a 34.13% increase through 2016 and the 25 year olds by 26.14%.
Scotch Whisky Auctions June sale pushed certain values further with a notable 1963 Macallan vintage (pre the more traditional 18 year olds) fetching a huge £2400. Buoyancy remained but looked to stabilise a little more for many other bottles of vintage 18’s as they continued to trade at the top of the market. The below Rare Whisky extract shows the volume and annual average value for the Macallan 1972 18 year old.
Bottles are vanishing from the market and values are soaring. A robust correlation?
Contemporary Macallan bottles continue to underperform the broader market.
William Grant’s highly collectable Hazelwood Reserve (the first of the five bottle set commemorating respective birthdays of Janet Sheed Roberts) has always been the most desirable of the set. This was last sold at auction in the UK for £420. That price seemed a distant memory as the current market fetched £2200.
The index below shows the combined performance of the five bottles.
The impact of this recent sale is clearly evident but the remaining four bottles continue their negative trajectory. We suggest this particular bottle was bought by a collector looking to complete the set. As this is the most challenging bottle to acquire, for a completist collector price is often not the biggest barrier… simply finding one is!
Old 1980’s Lagavulin had more or less doubled in value over the last 3 years. £920 was paid for a poor fill level White Horse 1980’s bottle. These old gems are becoming less frequently seen in the market. Are the remaining bottles being hoarded or are they being drunk? The answer to that in some respects will define future values. These old, hard to find discontinued releases, look to provide further value to the collector and investor; but is there value to be had out of the current retail/primary market? We look at that a little later.
Illustrating how influential and important the secondary market has become, some of the largest rare whisky retailers have now established auction based routes to market. The Whisky Exchange’s online auction – Whisky.Auction is one of those. Showing continued heightened demand for the rarest of examples, a bottle of Port Ellen 2008 Feis Ile sold for £3,700 in their June auction far exceeding its previous £3,400 record.
Bonhams June auction brought two notable rarities under the hammer. One of the 77 bottles of Dalmore Candela fetched a record £13,000, significantly up on its 2014 previous best of £10,600. The second bottle was interestingly a blend rather than a malt when an early 1900’s bottle of Johnnie Walker managed a very respectable £6000.
Whisky Auctioneer’s most recent auction ended on the 30th of May and was a generally buoyant affair. That said, a bottle of the 1953 Glenfarclas Wealth Solutions bottle came well down from its October 2015 high of £5,200. This bottle settled well below previous sales when it finally sold for £3,900 (broadly in line with its 2013 prices).
Tobermory isn’t necessarily the distillery most associated with collecting and investing, however, further cementing the underpinning of the whole market by liquid quality, a bottle of 1972 33 year old Tobermory sold for £735. We were fortunate enough to be able to sample this bottle on a recent treasure hunting trip and we were both bowled over by this exceptional spirit.
Final mention has to go to Whisky-online Auctions superb £8,200 result for a bottle of 1967 ‘Largiemeanoch’ – which is Gaelic for stunning sherry cask Bowmore! This bottle appeared expensive when it first sold in the UK for £2,350 in 2012, a price now dwarfed by recent market performance.
Old, rare and high quality whiskies continue to be the subject of desire to a growing international audience. This sustained demand is pushing prices ever higher. While demand remains as it is and supply (of the right bottles) is relatively low in the grand scheme of things, this continued buoyancy looks set to continue.
Some of the exceptional increases we’ve seen over recent months would appear to need to cool down a little. We can’t physically see the Macallan 18 year olds progress on the same trajectory. We envisage a cooling is required in certain areas of the market to restore balance; however, we don’t expect a significant re-trace… equally we never say never.
Primary Market/Retail Releases.
Continuing Lagavulin’s 200th birthday celebrations, a new 25 year old has been released. 8,000 bottles (slightly fewer than the 2002 release’s 9,000) wholly matured in sherry casks will cost £799 per bottle. Does that represent value to the collector and investor?
Firstly, the dedicated Lagavulin collector will undoubtedly need to buy this bottle but we see little immediate reward for the investor. The 2002 release 25 year old sells on the secondary market for around £500 – £600.
While, to some degree, we’re not speaking from a position of absolute knowledge as we haven’t yet tried the liquid (but we will be), we suspect a similar auction price-point could be achieved in the short to medium term e.g. a 20% loss over retail price. If the liquid is utterly stellar, secondary market prices could be a little higher.
From a pure pricing perspective, at £799, the Lagavulin has positioned itself above virtually every other 25 out there. The current 25 year old Macallan sherry oak can be found for the same price. Dalmore’s pricing was decreed as outrageous when their recent 25 year old hit the market for £600 (that now sells at auction for around £400).
Both Highland Park and Glendronach (Grandeur) can be found for around, or under, the £350 price point. Two worthy drams in anyone’s book.
Looking at some others – Glenmorangie can be found at £250, Glenfiddich is £299 and Diageo stablemate Talisker is a mere snip (it actually really is) at £230.
OR how about half a case of Glenfarclas 25 year old (£120 per bottle) for more or less the same price?
We’re not saying the pricing is wrong, bad, good, superb or indifferent, just interesting. Once we’ve tried the liquid we’ll be able to comment with absolute knowledge.
Sometimes packaging delights us; sometimes it turns us off; sometimes it sadly becomes more of a focus than the liquid it’s intended to position, enhance and display… Rarely does it confuse. But that’s where Gordon and MacPhail’s Mortlach 75 year old packaging has left me – utterly confused.
I’m not saying it’s bad per se, just a little left of field, a bit odd and probably not that sensible if the truth be told.
The recent Whisky Auctioneer whisky sale saw a bottle of the oldest Scotch in the world sell for the not insignificant sum of £17,800. Included in the sale was the leather travel/presentation bag. I have nothing against leather travel bags, I’ve owned one for many years and it’s been a welcome companion on many a trip… But would I stuff nearly twenty grands worth of Scotch and crystal decanter inside it and haul it over my shoulder? The concept seems about as sensible as popping into Lady Gaga’s meat dress and wandering round the Maasai Mara shouting “here Lion, Lion… here boy”. Maybe the inside of the bag has significant steel and Kevlar reinforcement? At least it’s different! Odd… granted, but different.
Anyway, moving from packaging to prices as is more the focus here; there were some huge new records achieved at last week’s Whisky Auctioneer sale.
Macallan – A market divided.
As auction values for more modern releases and many Macallan ‘drinkers’ splutter and falter like an asthmatic steam train ascending Everest, many are becoming available at auction for significantly less that you’d pay at retail (Rare Cask for £135 at auction). On the flip side of this crumbling coin is the golden face of the ‘old’ bottles. The older vintage 18 and 25 year old’s are absolutely flying. Values are increasing at an unprecedented rate. The 18’s have already increased by 24.69% this year and the 25 year old’s have increased by 19.35%. April’s Rare Whisky 101 month-end charts were off the scale and that growth looks to be accelerating. As with the vast Karuizawa gains seen through early 2015, we’re wondering if the market is becoming overheated. Certainly, the pace of these increases cannot be maintained. Three of the 18 year olds sold at this auction achieved fresh new records – the 1970 hit £1,050, a bottle of 1974 sold for £975 and the 1978 made £825. All were selling for around a third of those prices as recently as 2013.
Islay continues to ride high.
Yet again, older rarer bottles from Islay made big money. I remember being sat in the auction room at Bonhams (Edinburgh) in 2010 and chatting in hushed tones to a friend as the auction moved along. Almost exactly when I’d finished talking, the hammer fell on a bottle I couldn’t believe I missed. £120 took a bottle of 1972 27 year old Bowmore… A snip… and I missed it because I was chewing the fat over Lyne arm angles, secondary fermentation or some other utterly geeky stuff. Like my old school reports – pay more attention! Especially noting that bottle sold for £858 at last week’s Whisky Auctioneer sale.
White Horse bottled Lagavulin seems to be in ever increasing demand. £230 took a bottle to nearly double its recent trading range… Maybe there’s panic in them there hills? Might 16 turn to eight then turns to NAS?! I suspect not to be fair, but who knows. A bottle of Murray McDavid bottled 1979 Lagavulin also shone through as a clear winner managing £1,000 for the first time. Until the end of 2013 this bottle had never sold for more than £200 at auction.
Bruichladdich saw a bottle of its 40 year old make the most expensive bottle of ‘Laddie at auction in the UK. A respect-worthy £1750 took it past a previous best of £1550.
From a silent stills perspective. The big movement was seen from independent bottlers. A brace of 1972 vintage Brora’s from Douglas Laing went expectedly berserk. The Old and Rare 29 year old managed £2,350, massively ahead of its previous UK sale price of £500 (that was expensive in 2010!) and the 30 year old bottled for The Whisky Shop hit £1,426, not a record but a superb price noting it was lacking its card tube.
Port Ellen had a noticeable lack of bottles at auction but a Connoisseurs Choice 1982/2007 stood out when it fetched £410.
All told, last week’s Whisky Auctioneer sale was as buoyant as they come. We’re just keeping a close eye on the rapidly heating vintage Macallan market. For those with a few stashed away, values are clearly increasing; however, I’m not so sure I’d be entering the market in a hurry right now. As always, time will tell.
Images courtesy of Whisky Auctioneer.
Cutting to the heart of the Scotch Whisky industry.