Port Market Over a Barrel

The world of Port--as aged and tradition-encrusted as anything in wine--is being turned upside-down these days.

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In many cases, great vintage Port can be bought for little more than what it sold for when it first came out. So dramatic have sales been that Bartholomew Broadbent, one of the nation’s top Port importers, believes Americans bought more vintage Port in 1993 than did the British--a shock when one considers that the British consider Port almost the national drink. (Gin lovers may disagree.)

“When the 1983 vintage Ports were released (in 1985), America was the eighth-largest Port-consuming nation in the world,” says Broadbent, whose Sausalito-based company, Premium Port Wines, imports Port and Madeira. “Last year, America was No. 2--but if you add in all the gray-market Port, I’m sure America is ahead of England.” (Gray-market wines are imported legally, but not by an officially recognized trading company, and their statistics are difficult to come by.)

In fact, it is estimated that Americans bought one-third more Graham’s 1991 Port, a high-demand Port, than did British buyers.

“When consumers have a chance to buy (vintage Port) at prices they haven’t seen for a long time, they just buy and buy,” says Don Schliff, a vice president for the Los Angeles-based wholesale company Wine Warehouse.

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“It’s been a buyer’s market in Port the last six to eight months, and not just for the latest wines, but for Ports from the great vintages, such as ‘63, ’70 and ‘77,” adds Schliff, who has a huge personal Port collection as well. “Our Port sales are off the charts and we can’t keep them on the shelves. One shipment comes in, it goes out, and we have to order more.”

There are many reasons for the low prices now seen on older vintages of Port. The most significant is the weakness in the British economy.

“Losses in the Lloyd’s (of London) insurance market had a powerful effect on Port collectors in England,” says Broadbent. He says many wealthy English families who lost money in the insurance business decided to raise cash by selling their Port collections.

“These were great families, most of whom had great wine cellars, and a huge number of these people are going bankrupt,” he says. “They are dumping their wines on the market to raise cash.”

The private cellars are showing up on the wine auction market, which is frequented by savvy wholesale buyers. Eventually the lower Port prices at auction results in lower prices on the retail shelf.

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Also, International Distillers & Vintners, a division of Grand Metropolitan PLC, has been discounting its large Port stocks to raise cash, says a source who asked for anonymity.

It is now possible to buy many Ports from the excellent 1977 vintage for about $55 to $60 a bottle, with some wines from fine houses selling for even less than $40. Ports from the 1963 vintage, well-aged wines from what is considered one of the greatest vintages of all time, are routinely selling for $110 to $120, occasionally for even less than $70.

The prices for the 1977s are not much higher than when they were released in 1979; part of the reason is the way wine is sold today compared with the way it was sold 15 years ago.

Back in 1979 and 1980, most wine merchants took a standard 50% markup on wine, so a bottle that cost a merchant $40 would sell for $60. The Wine Club, Wine Exchange, Wine House and many other discounters are working on a 12% margin, so the wine that cost $40 to the retailer goes on the shelf now at $45 to $48.

Another reason for the softness in prices is the huge amount of vintage Port being sold by those who speculated in the 1977 vintage Ports. After the excellent 1970 vintage, six years passed with virtually no vintage Port. When the ‘77s gained high praise, many buyers took large amounts, hoping to sell them at a profit through the auction market at a later date. That date has arrived for many speculators, though not the hoped-for profits.

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In addition, Los Angeles’ vintage Port market is among the strongest in the world because of Hollywood’s link to the British film industry. British film executives who live full- or part-time in Hollywood frequent top restaurants and ask for Port for after-dinner sipping. L. A. restaurateurs thus have been spurred to add vintage Ports to their wine lists in increasing numbers. Sales of Port by-the-glass have rocketed in the last two years, says Broadbent.

“The scale of this (demand for Port) is a lot bigger than most of us can realize,” says Broadbent, who is the son of London wine auctioneer J. Michael Broadbent. “Container loads of Port were coming out of England last year in such numbers it shocked me, and I’m usually an optimistic person.”

He and Schliff both said prices for vintage Ports are still fairly reasonable, but both predicted that the bottom may have been reached. “I think prices will rise by the end of March because the discounted lots will have gone,” says Broadbent.

Oddly, lower prices for the older vintages of Port have had little impact on the prices for the excellent 1991 Ports, according to Broadbent.

“The 1991s sold in excess of my expectations,” he says. “In Los Angeles the (suggested) price for 1991 Graham’s was $32, and you could buy 1983s and 1985s for less than that. But people want the latest, hottest thing.”

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Broadbent says another reason for strong Port sales in this country is simply that here, unlike England, people don’t wait decades to drink them.

“People drink vintage Port young in America,” he says. He estimates that 85% of California vintage Port buyers prefer younger Ports to older Ports. “We eat a lot of chocolate desserts, and young vintage Port goes better with chocolate than just about anything,” he says. “Also, you are used to drinking young Cabernets, so you don’t mind the tannin in Port the way the English do.”

But above all, says British-born Broadbent, “You (Americans) don’t have the stuffy English manor house tradition that Port has to be old. You don’t have this preconception about Port. You just drink it.”