![\"\"](\"https:\/\/businesstech.co.za\/news\/wp-content\/uploads\/2017\/07\/Knight.jpg\")
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South Africa\u00a0<\/strong><\/h3>\n![\"\"](\"https:\/\/businesstech.co.za\/news\/wp-content\/uploads\/2017\/07\/Wine-e1501249165308.jpeg\")
<\/a><\/p>\nSpeaking to BusinessTech, Roland Peen, director of fine wine merchants Wine Cellar<\/a><\/strong>\u00a0noted that wine as an investment had also seen increasing interest in South Africa.<\/p>\n“In the last five years South African wine has reached a new point of local and international interest,” he said.<\/p>\n
“There has been a surge of quality as winemakers have discovered precious old vineyards, vineyard quality has increased and winemaking in general has been improved. South Africa is now producing some of the hottest and most highly sought-after wine in the world.”<\/p>\n
He noted that South Africa’s wine was still relatively cheap compared to similar quality wines from Europe and the US.<\/p>\n
“We also produce fine wines in small volumes, which means demand exceeds supply and there is ample room for price growth. Customers are therefore seeing opportunity to make money in buying fine wine and selling them at a later stage.”<\/p>\n
\nAre South African wines actually an investment compared to the European vintages?<\/strong><\/h3>\n![\"\"](\"https:\/\/businesstech.co.za\/news\/wp-content\/uploads\/2017\/07\/WineCork-e1501249219367.jpg\")
<\/a><\/p>\nWhile South African wines are yet to enter the European-dominated market, Peen said they had seen increasing traction as a secondary market.<\/p>\n
The other key difference is that few South African wines are produced in the same volume as the fine investment grade wines from Bordeaux, he said.<\/p>\n
“A top Chateau from Bordeaux will produce 20,000 cases every vintage, whereas a leading South African red such as Vilafonte or MR de Compostella will be under 1,000 cases.”<\/p>\n
“Therefore rarity is driving the market, more so than absolute quality at this stage.”<\/p>\n
\nCosts<\/strong><\/h3>\n![\"\"](\"https:\/\/businesstech.co.za\/news\/wp-content\/uploads\/2017\/07\/WineGlass-e1501249197608.jpeg\")
<\/a><\/p>\nWhile the costs may not be as high as the the European wines, \u00a0Peen noted that the market was unfortunately some way off from\u00a0the everyday investor putting equity into fine wine.<\/p>\n
This is primarily because the lack of a\u00a0highly liquid trading platform and wine index which has made the secondary market difficult to promote, he said.<\/p>\n
“There is a small market that has been built by wine collectors and speculators who are more interested in wine than investment.”<\/p>\n
“There are storage fees importantly which are relatively low when compared to the price of the wines. You cannot expect to invest in wine that is not stored in perfect conditions. Wine Cellar offers storage to 600 private clients in Cape Town at the moment and we are opening up a storage operation in Johannesburg before the end of the year.”<\/p>\n
He also warned that there was a brokerage fee at sale to consider, which can vary depending on the merchant.<\/p>\n
“One can expect a minimum initial spend of R5,000 to R10,000 in order to get a small portfolio of blue chip wines together,” he said.<\/p>\n
While it can currently be quite difficult to liquidate your investment, Peen noted that\u00a0Wine Cellar was now in the process of\u00a0building an online trading platform that will make the process easier, grow the market and increase liquidity.<\/p>\n
\nSo which South African wines you should be buying?<\/strong><\/h3>\n
<\/a><\/p>\nSpeaking to BusinessTech, Roland Peen, director of fine wine merchants Wine Cellar<\/a><\/strong>\u00a0noted that wine as an investment had also seen increasing interest in South Africa.<\/p>\n “In the last five years South African wine has reached a new point of local and international interest,” he said.<\/p>\n “There has been a surge of quality as winemakers have discovered precious old vineyards, vineyard quality has increased and winemaking in general has been improved. South Africa is now producing some of the hottest and most highly sought-after wine in the world.”<\/p>\n He noted that South Africa’s wine was still relatively cheap compared to similar quality wines from Europe and the US.<\/p>\n “We also produce fine wines in small volumes, which means demand exceeds supply and there is ample room for price growth. Customers are therefore seeing opportunity to make money in buying fine wine and selling them at a later stage.”<\/p>\n While South African wines are yet to enter the European-dominated market, Peen said they had seen increasing traction as a secondary market.<\/p>\n The other key difference is that few South African wines are produced in the same volume as the fine investment grade wines from Bordeaux, he said.<\/p>\n “A top Chateau from Bordeaux will produce 20,000 cases every vintage, whereas a leading South African red such as Vilafonte or MR de Compostella will be under 1,000 cases.”<\/p>\n “Therefore rarity is driving the market, more so than absolute quality at this stage.”<\/p>\n While the costs may not be as high as the the European wines, \u00a0Peen noted that the market was unfortunately some way off from\u00a0the everyday investor putting equity into fine wine.<\/p>\n This is primarily because the lack of a\u00a0highly liquid trading platform and wine index which has made the secondary market difficult to promote, he said.<\/p>\n “There is a small market that has been built by wine collectors and speculators who are more interested in wine than investment.”<\/p>\n “There are storage fees importantly which are relatively low when compared to the price of the wines. You cannot expect to invest in wine that is not stored in perfect conditions. Wine Cellar offers storage to 600 private clients in Cape Town at the moment and we are opening up a storage operation in Johannesburg before the end of the year.”<\/p>\n He also warned that there was a brokerage fee at sale to consider, which can vary depending on the merchant.<\/p>\n “One can expect a minimum initial spend of R5,000 to R10,000 in order to get a small portfolio of blue chip wines together,” he said.<\/p>\n While it can currently be quite difficult to liquidate your investment, Peen noted that\u00a0Wine Cellar was now in the process of\u00a0building an online trading platform that will make the process easier, grow the market and increase liquidity.<\/p>\n
\nAre South African wines actually an investment compared to the European vintages?<\/strong><\/h3>\n
<\/a><\/p>\n
\nCosts<\/strong><\/h3>\n
<\/a><\/p>\n
\nSo which South African wines you should be buying?<\/strong><\/h3>\n