Investment Tips - Italy - 31. October 2019

The first real Barolo gains +25.6% in 12 months

Demand for Italian top wines is rising and Conterno Monfortino in particular is gaining ground with an average annual return of 13.2% over the past five years!

From Modest Wine Bar to International Success - the Story of Giacomo Monfortino

If the name Giacomo Conterno rings a bell, it is not without reason. Giacomo Conterno is one of the absolute biggest names from Piedmont, Italy and perhaps the most important at all when it comes to Barolo.

However, the brand and house Giacomo Conterno had a more humble origin as a modest wine bar in San Giuseppe in 1908. The wine bar was run by Giacomo's father, Giovanni, who produced wine for the establishment from grapes purchased by local wine farmers.

Giovanni passed the torch to Giacomo, who also included his sons; (another) Giovanni and Aldo, in the family business in 1961. Aldo had an interest in more modern and progressive wine production, which resulted in Giovanni carrying on the family tradition in pursuit of producing Barolo in the absolute highest quality.

Giacomo Conterno, now with the third generation at the helm, continued to buy all grapes from local farmers until 1974. By this time, many of the local farmers had even begun to produce wines in their own name, which could deprive Conterno of the vital supply of grapes. As a result, Giovanni bought the already recognized vineyard Cascina Francia in Serralunga - this became crucial to the house's huge recognition and international success.

High returns on Monfortino Mature bottles of Monfortino, from before the wine became a legendary single-vineyard Barolo

Monfortino: The first real Barolo

The Conterno crown jewel, Monfortino, is not only perhaps the greatest Barolo, but also the very first Barolo created in what later became known as the classic Barolo style. In the early 1900s, Barolo was primarily sold in barrels or demijohns*, created to be drunk early. But when Giacomo, returning from the hardships of World War I in 1920, had a vision of creating a Barolo with fabulous aging potential. This wine was called Monfortino.

Since 1978, Cascina Francia has been the only source of grapes for Giacomo Conterno's top wines. In good vintages it is called Cascina Francia, as the vineyard itself. In the very best vintages, the best of the grapes from the vineyard is used for the mighty Monfortino - the first real and perhaps biggest Barolo ever.  

* large glass bottles / balloons

Burgundian ancestry in Piedmont

Piedmont is often compared to Burgundy by many experts and this is not simply due to the status of highly loved wine meccas. The wines are typically made from a single grape variety, the grapes come mainly from single vineyards, and the production is also very limited, from small specialized wineries.

Conterno Monfortino, produced on 100% Nebbiolo, which characterizes the wines of Piedmont in the same way as Burgundy is characterized by Pinot Noir, is no exception. However, there is uncertainty about how much is actually produced each year. The reason for the uncertainty must be, that the large Cascina Francia mark (16 ha) supplies grapes for both the wine of the same name and the flagship wine Monfortino. The better conditions a year has given the grapes, the greater the proportion of grapes reaches the extremely high standard required to be used for the Monfortino. However, Robert Parker’s Wine Advocate believes to have disclosed the total amount of 2013 Conterno Monfortino. According to them, only about 20,000 normal bottles, 2,500 magnum bottles and 400 three-liter bottles have been produced, which in particular must characterize Monfortino as a limited production wine.   

The wines from Giacomo Conterno are among the best from Piedmont and it doesn’t really get any better than Monfortino. If you want to translate Italian into French, Conterno Monfortino is in Italian, what Leroy Musigny is in Burgundy. Obviously, the two wines cannot be compared, but it gives a good picture of what Monfortino is in Piedmont. 

Investment in Conterno Monforcino The Cascina Francia vineyard where the Monfortino originates from

A high-scoring Bargain

There is a growing demand for the best Italian wines, which can probably be related to the quality of these wines being better and better. 2013 is the latest Monfortino release, receiving the almost perfect 99 points from Vinous and 98 points from Robert Parker’s Wine Advocate   

The 2013 vintage comes in the wake of the almost mythical 2010 Monfortino which scored 100 points by both Vinous and Wine Advocate. Today 2010 costs around € 1,250 * per bottle, which is more than +35% compared to 2013 vintage. Having the 2013’s high quality, which does not differ more than it does, from the absolute peaking 2010 vintage in mind, you can hardly justify to talk about a value vintage, but just an exceptionally good deal, if not a bargain!

In fact, the price is not only attractive compared to the 2010, but also compared to the trade price at the release. The price today is approx. 30% lower than just four months ago when the 2013 Monfortino was released. In fact, it is always more expensive to be among the first to secure quantities of newly released top wines. When the first buyers are serviced, the price under normal circumstances temporarily drops a bit, before it begins to rise again. This development is quite normal, whether shopping in Champagne, Burgundy or in this case Italy. In an investment perspective, timing is therefore crucial, and now seems like an obvious time for investment in 2013 Monfortino.  

* Ex. duty, VAT and duty, in perfect condition and whole boxes

Increasing Interest in Italian Top Wines

On October 22, the British wine exchange, Liv-ex, was able to report that their Italy 100 index so far in 2019 has been their best performing index, with a return of +5%. At the same time, the Italy 100 index is the only Liv-ex 1000 sub-index that has consistently delivered returns month to month this year.

Prices of Piedmont wines, including Conterno Monfortino, have risen more than prices of Tuscany wines and Liv-ex's Piedmont index have risen 12% since December 2017.

Although prices have risen significantly, Italian wines continue to offer some of the cheapest entries into the fine wine market. This, combined with the towering and ever-increasing quality, means that the Italian top wines are only enjoying growing interest from wine merchants, collectors and connoisseurs alike.

Read the article from Liv-ex here: Italy - what is happening at the prices?  

Monfortino Rewards Investors: +25.6% over the past 24 Months

The rising demand for Italian top wines can also be seen by looking at the prices of the Monfortino vintages that have been on the market for at least five years *.

Year1 year2 years5 years
Average return across years*25,6%33,5%85,7%
Average annual return25,6%15,6%13,2%
Liv-ex data from September 30 and five years back.
Label from Conterno Monfortino Label from Conterno Monfortino

Rare Wine Invest’s Opinion

We do not have many investment recommendations on Piedmont wines for various reasons, but with several common features with well-known Burgundy wines, Monfortino possesses what it takes to become a strong Italian investment.

The quality of 2013 Conterno Monfortino places it among the absolute best Italian wines and the price right now seems particularly attractive when compared with the 2010 vintage, which is currently traded at more than 35% higher prices. Now, the 2013, is available at a really strong price.

The production of Monfortino and in general in Piedmont is relatively limited, and this is to a market that seems to have a growing demand for the Italian top wines - traceable in Liv-ex's Piedmont index. In particular, the growing interest can be read in the increasing prices in the past five years by Conterno Monfortinos which has been on the market for a minimum of five years. Those vintages delivered an average annual return of 13.2%.

2013 Conterno Monfortino is the obvious investment case for the wine investor with an Italian romance, who has not yet had the opportunity to buy into a strong Piedmont case. The case is also perfect for the investor who wants to increase his Italian position, or perhaps spread his Italian exposure to both Tuscany and Piedmont.

Whatever, the 2013 Conterno Monfortino caters to every investor, but action must be taken quickly: Rare Wine Invest only has a very limited quantity in offer for investment.

Monforcino Available for Investment

2013Conterno Barolo Monfortino750OWC366€ 925
*All prices are in EUR ex. customs duty, tax and VAT for delivery to a bonded warehouse. Prices including customs duty, tax and VAT can be sent on request. The wines are only sold in whole cases unless otherwise specified and the price is per bottle. Minimum order size € 2,500. Assumes a total minimum investment of € 10,000. Prices may have changed since release of this article.

Do you want to learn more?

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