Christmas Investment Picks: A Tuscan Estate to Watch
Christmas Investment Picks: A Tuscan Estate to Watch
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In the last month, I’ve had the pleasure of dwelling on some fine wines from Tuscany.
One, needs no introduction — Ornellaia and another one, Tenuta Sette Cieli, is probably the best estate you’ve never heard of.
Vianney, the Sales and Marketing Director at Ornellaia and Masseto, was in London for a Decanter event where we had a chance to meet. We had a lovely chat and I asked him what makes Ornellaia such an iconic brand in the world of fine wines.
I asked him that question because a few weeks prior I was invited to a press lunch by
. You may know him from his newsletter here on Substack or his work at 67 Pall Mall and the Wine Training School, or Verticale, or his Barolo del Comune report, …And, if you’ve met him, you know you can trust him to find the most niche wines from Italy and to have the most fantastic gossip about them.
Thanks to his incredible memory and colourful storytelling, he’s a walking encyclopaedia of, among others, Bolgheri, Barolo and Franciacorta wines and their more interesting producers. That’s why, when he invited me for this press lunch at Medlar (an unassuming little restaurant for winos in Chelsea) to meet Tenuta Sette Cieli’s head winemaker and CEO, Elena Pozzolini, as part of his buyer work for Swig, I knew I was in for a treat.
During lunch, we tasted 10 wines from Tenuta Sette Cieli under Elena’s and Nelson’s guidance.
My three main takeaways are:
Elena’s rising reputation as Italy’s superstar winemaker (Robert Parker dixit) is no surprise — she has very high standards! For example, she thought we were tasting the wines at one or two degrees too high: she interrupted the tasting to make sure that the wines were chilled before we continued. She prefers large old barrels to small oak ones and has a low interventionist approach to wine. Her personality, technical ability and diligence come through her wines with precision and finesse. She had me two minutes into our conversation when she said “I love clean wines”.
Elevation plays a crucial role on the Tuscan coast — you can see in the map below (red) that the 120 hectares owned by the Tenuta are some of the highest of the neighbouring producers of the appellation, imparting a distinct focus and linearity to their wines.
Producing high-quality Cabernet Franc in Tuscany can be challenging. If too hot, it loses its elegance. If too cold, its herbaceous notes can be harsh. However, as Le Macchiole showed with Paleo, some elevation (Le Macchiole’s plot is 37 to 70 meters above sea level) and expert vineyard management, can make all the difference and create some truly magical wines. You should try Scipio. Fruit comes from a 10-hectare plot that rises from 400 meters above sea level and even in the hottest vintages, say 2017, you wouldn’t feel anything less than an incredibly chiselled and complex wine.
(For some reason, the name Scipio gave me the false impression that it was going to be a powerful, bold wine — the opposite of what it is).
The Wines.
Now, a little more detail.
Tenuta Sette Cieli produces four wines: Noi4, Yantra, Indaco and Scipio, using grapes from their high-altitude vineyards.
Noi4 is the Tenuta’s only Bolgheri DOC. All the other wines are classified as Toscana IGT. We tasted the latest vintage 2021, released in May 2023.
The other 2021 we tasted is Yantra, a blend of Cabernet Sauvignon and Merlot from just outside the Bolgheri DOC lines, at 400m above sea level. There one could find sasso (rocks) soil, which is why neighbouring Sassicaia is called as it is (in the flat down below, sand dominates). In addition, the estate is surrounded by forest which aids perspiration. This wine is their second selection but sets the mood for the other two.
Indaco is their first selection wine and combines in equal parts Malbec, Cabernet Sauvignon, and Merlot, inspired by Bordeaux's traditional blends. Growing Malbec in Tuscany's coastal climate can be challenging, with problems such as botrytis —Malbec has a thin skin! However, Elena’s prior experience in Argentina best positions her to chisel the estate’s Malbec to align to the high altitudes trend for the grape (we discussed this — Is high altitude turning Malbec’s into Volnays?). One of her tricks is to plant barley so that the vines have to compete with the plant for water.
Their crown jewel is Scipio, made exclusively from Cabernet Franc, which is only produced in favourable years, leveraging the region's cool breezes and significant diurnal variations.
Both wines undergo fermentation with indigenous yeasts and age in French 225-litre barrels— Indaco for 18 months and Scipio for up to 20. Indaco suits earlier drinking, while Scipio offers longer ageing potential. We tasted vintages from 2016 to 2019 for both wines.
The vintages of Tenuta Sette Cieli's Indaco and Scipio from 2016 to 2019 illustrate the estate’s adept handling of varying climatic conditions, each year bringing a unique character to these wines. Each vintage reflects the winery's commitment to capturing the essence of the Tuscan terroir and the distinct yearly climatic influences, showcasing their potential for both immediate enjoyment and long-term ageing.
The 2016 vintages of both Indaco and Scipio are marked by a balance and elegance, reflective of the milder climatic conditions of the year, setting a high benchmark in complexity.
In contrast, 2017, a year of extreme weather, surprisingly reveals a well-rounded Indaco and a notably concentrated yet elegant Scipio, underscoring the resilience and adaptability of the vineyard and winemaking techniques.
The 2018 vintages, benefiting from a mild winter and rainy spring, offer aromatic depth and nuanced flavours in Indaco, and a more delicate profile in Scipio.
The 2019 vintages, characterised by fluctuating temperatures, suggest an intricate interplay of flavours and a harmonious blend of intensity and elegance in both wines.
The Investment Case.
During lunch, I was sitting opposite Swig founder, Robin. He mentioned he was interested in the topic of wine investment and he asked what makes a great wine an investment wine.
The exploration of Tenuta Sette Cieli's wines brings to light this intriguing possibility.
These wines, though currently less known in the expansive world of fine wines, possess a unique blend of qualities that could position them as the next big investment wines, especially once they get the attention of influential wine critics.
I don’t recall whether my answer to Robin was eloquent but, the key factors that make a wine an attractive investment include longevity, scarcity, and inherent quality.
Vianney put it simply — “First and foremost, the wine must be good!”
Tenuta Sette Cieli's wines, particularly their Indaco and Scipio, exhibit these attributes in abundance. Elena’s approach, emphasising meticulous vineyard management and a low-interventionist style, results in wines with remarkable finesse and ageing potential. When I asked about longevity, Elena replied that she believes that the bulk of the work has to be done in the vineyard, “before the alcohol comes into the picture”, because correcting it in the cellar will lead to the faults showing themselves in later years.
(I wonder if Bordeaux 2022 is an example of this…)
Scarcity is one of those economic factors — lower supply (potentially) equals to higher prices. Production for Indaco is 12,000 bottles while for Scipio is 8,000. Production is small. Very small. A commitment to quality and the estate's limited production contribute to the wines' scarcity, adding to it as potential investment pieces.
The controversial case of Marketing.
However, that’s not enough.
I said to Robin that I believed marketing was important. As history has shown, once critics like Parker spotlight such hidden gems, their market value can escalate dramatically. Their ratings have the power to transform the market perception and demand for wines.
In the paper “The Impact of Gurus: Parker Grades and EP Wine Prices”, Héla Hadj Ali, Sébastien Lecocq, and Michael Visser offer specific insights into the impact of Robert Parker's ratings on Bordeaux wine prices:
On average, each additional point in Parker's ratings increases the wine's price by €2.80 per bottle.
The impact of Parker's ratings is more pronounced for higher-rated wines.
The effect of Parker's ratings varies across different appellations, with Pomerol wines showing the most significant price impact.
The study used a unique approach by analysing a vintage (2002) when Parker's ratings were delayed, allowing for a clearer assessment of his influence on wine prices. Normally, Parker would taste the wines about six months after the harvest, but for the 2002 vintage, he tasted them approximately 11 months after the harvest, between August 30th and September 8th. This delay in tasting led to the ratings for the 2002 vintage being published later than usual, in the October issue of The Wine Advocate.
Similarly, in 2008, Colin Hay analysed, anecdotally, Robert Parker's impact on Bordeaux wine prices in a piece for Decanter, with the following findings:
Parker's scores closely correlated with release prices for Médoc wines in the 2005 and 2006 vintages, and even more so than the château's 1855 classification in the 2004 vintage.
For St-Emilion wines, Parker's ratings were the primary factor influencing price in all three vintages studied.
In 2005, each additional point above 90 in Parker's ratings increased Médoc classed growth prices by £120 per case and St-Emilion grands crus by £201 per case.
Parker's influence varied across vintages and was less pronounced in 2005 compared to 2004 and 2006, possibly due to fewer scores published in advance of the en primeur campaign in 2005.
The recent case of grower Champagne is a case in point. Egly-Ouriet, Jacques Selosse, Agrapart & Fils, … with their abundance quality but scarce quantity have been catapulted in the realm of iconic by positive reviews of influential wine critics such as William Kelley. Prices are now prohibitive.
The upside potential for Tenuta Sette Cieli, when compared to Ornellaia, Masseto or Sassicaia, is 2.5-3x.
Conclusion.
For an investor wanting to get a chance to take advantage of such double-digit returns, there is no other way than analysing each wine and estate along the axis of longevity, scarcity and marketing.
Tenuta Sette Cieli's wines are an exciting investment choice.
Achtung! The combination of their quality, rarity, and the growing reputation of Elena as a top-tier winemaker, positions these wines on the cusp of discovery.
Thanks for tuning in this week!
Season's greetings to all my readers — I hope you have some time to spend in the company of family and friends and perhaps a great glass of wine!
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👋 Sara Danese
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Disclaimer
My investment thesis, risk appetite, and time frames are strictly my own and are significantly different from that of my readership. As such, the investments covered in this publication and in this article are not to be considered investment advice nor do they represent an offer to buy or sell securities or services, and should be regarded as information only.