Hermitage, Côte Rotie, & Cornas: Minuscule Production, Maximum Effort, Unmatched Quality
When wine connoisseurs think of small vineyards, limited production, and world-class quality, their minds inevitably go to Burgundy. The Northern Rhone rarely comes to mind when, in fact, the top wines of Hermitage, Côte Rotie, and Cornas are made in the same minuscule quantities and require much more effort to farm due to exceptionally steep slopes. The wines from the Northern Rhone are favorites of sommeliers, and are slowly gaining momentum and notoriety among the broader investment market.
The microscopic sub-regions of the Northern Rhone range in size from 270 acres in the Cornas AOC (Appellation d’Origine Contrôlée) to 735 acres planted in the Côte Rotie AOC. For context, more than 30 times more vineyard acres are planted in Napa Valley than in Hermitage, Côte Rotie, and Cornas combined. Under AOC rules, Syrah is the only red grape allowed to be grown in these three sub-regions. The resulting wines are rich, deep, brooding wines that can age for decades and rival those of Bordeaux. However, while similar in quality, the top wines from the Northern Rhone only cost a fraction of top labels from Bordeaux or Burgundy. To quantify the price difference, Liv-Ex notes in a 2020 Report on the Rhone Valley that the top red wines from the Northern Rhone “were 7.5 times cheaper than Burgundy’s top Pinot Noirs on average” in 2020.
Why the discrepancy in prices if the quality is perceived as equal? Regional brand power, accessibility, and classification have a lot to do with it. Long a mercantile capital, Bordeaux has maintained a built-in marketing and distribution mechanism for centuries. Combine this infrastructure with the Classification of 1855, which made it easier for consumers to understand which wines were “better” than others, and Bordeaux was well-positioned to flourish on a global stage. Burgundy has also had a formal classification system for individual vineyards since 1861, but was slower to emerge in international markets due to a regional emphasis on agriculture rather than trade, and a general lack of exportation infrastructure.
In contrast, the appellations of the Northern Rhone have never established an official classification system and are geographically further removed from major markets like Paris and London. This is not to say the wines from the region weren’t respected. The region, especially Hermitage, has been celebrated for centuries, drawing visitors like Thomas Jefferson and even being used to “improve” the light red wines of Bordeaux in the 1800’s. However, phylloxera in the late 1800’s devastated the vineyards, and as two world wars took their toll on the population of France many of the notoriously difficult to work vineyard sites throughout the Northern Rhone fell into disuse.
In the second half of the 1900’s, vineyards were slowly revitalized through the hard work and diligence of the Guigal, Chave, and Chappoutier families, among others. The region began to emerge from its doldrums in earnest in the 1960’s when Etienne Guigal introduced his first single-vineyard “La La” wine, La Mouline, to the world. Guigal’s single-vineyard approach and employment of modern winemaking techniques caught the attention of Robert Parker in the 1980’s, and with it the global spotlight, which helped launch the Northern Rhone back onto the global scene.
The momentum from the 1980’s has continued to grow, and as the 21st century enters its third decade, the Rhone Valley as a whole is seeing growing demand. From 2010 to 2020, the number of Rhone wines listed on the Liv-Ex wine trading platform has risen 660%. Today, traders in the US are the leading source of demand for Rhone wines, overtaking the UK in the past five years and now making up for more than 50% of trade volume.
While the trade of wines from the Rhone Valley is increasing, the Northern Rhone still produces the majority of the top investable wines by value. According to a 2020 report by Liv-Ex, “the top wines from the Northern Rhone cost on average 2.2x more than the south’s ‘finest’.” Today, the regions of Hermitage, Côte Rotie, & Cornas make up 53% of the wine trade by value despite far lower production than regions in the Southern Rhone.
To emphasize the disparity in production levels between the Northern and Southern Rhone, we turn to The Oxford Companion to Wine, where Jancis Robinson notes:
“The total production of the northern Rhône is less than 5% of total Rhône valley wine, with Crozes-Hermitage alone representing well over half of all wine produced in the north.”
So, while Hermitage, Côte Rotie, and Cornas make up less than 2.5% of the wine produced, those wines make up 53% of value traded.
Below are a few examples of the tiny production volumes produced in the three key Northern Rhone appellations we are discussing. In Hermitage, less than 400 cases of Chapoutier’s L’Ermite Rouge and less than 1,000 from Jean-Louis Chave. In Cote Rotie, 400 cases of Guigal’s La Mouline and La Turque are made on average. Finally, in Cornas, the smallest region, Thierry Allemand produces fewer than 500 cases per year.
While these production numbers offer insight into the meager quantities currently produced, they don’t tell the story of the near-total lack of space available to plant new vines. These regions are so small that virtually every portion of the steep slopes that are farmable have already been planted. So, between the perilously steep vineyards that exist, and lack of room to grow, the production of these top wines is inherently limited.
The wines of the Northern Rhone are evidently unique in the wine investment world. After a century of hardship, these small production wines with a storied past continue to reemerge onto the investment wine scene. Between rising consumer interest spurred by sommeliers and critics like Jeb Dunnuck, who devotes specific attention to the Rhone Valley, these fantastic wines are finally garnering the recognition they deserve, and the future looks bright for the region as a whole.
Written by: Billy Galanko, Head of Wine
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Sources:
https://www.liv-ex.com/2021/11/continued-demand-rhone-year-progresses/
The Oxford Companion to Wine, Jancis Robinson
The Sommelier’s Atlas of Taste
http://files.liv-ex.com/The_Rhone_Solid_as_a_Rock.pdf
https://www.liv-ex.com/2021/01/liv-ex-interview-matt-walls-wines-rhone-regions-collectible-appeal/
