Sake: the next big thing in drink­able in­vest­ments?

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As the Ja­panese rice wine be­comes more pop­u­lar, can in­vestors ben­e­fit from grow­ing de­mand, asks Olivia Rudgard

Sake is en­ter­ing the main­stream. The Ja­panese rice wine, once rarely seen out­side Ja­pan, is on the way to be­com­ing an in­ter­na­tional del­i­cacy – and even an in­vest­ment. World-renowned wine ex­pert Robert Parker has added 78 va­ri­eties of sake to his list of top wines for the first time ever. But what about the in­vest­ment po­ten­tial?

Tra­di­tion­ally sake was brewed to be drank im­me­di­ately. It would be bot­tled and then sold within the same coun­try, mean­ing vin­tage va­ri­eties did not re­ally ex­ist.

But that is chang­ing with the drink’s emer­gence onto the global stage. A few vi­sion­ary brew­eries started mak­ing sake de­signed to be kept for longer in the late Eight­ies – but these are few and far be­tween.

A hand­ful of vin­tage bot­tles have made it into the UK mar­ket.

Among the old­est are some from Nira brew­ery, from Ja­pan’s Kan­sai re­gion. Bot­tled in 1988, these are an­cient by sake stan­dards – a fact their name, Koshoku­sozeh, which means “ap­par­ently old”, re­flects.

Sake ex­pert Nobuyuki Sato, a vis­it­ing fel­low in in­ter­na­tional eco­nom­ics at Chatham House, said the brew­ery ex­pects to sell the bot­tles for around 20,000 yen, or £150 – but the value could go up or down de­pend­ing on how the sake ends up tast­ing.

The risk is that vin­tage sake is still an un­known quan­tity. The drink could turn out to be dis­as­trous – and no one will know un­til it’s been tasted.

But ex­perts are hope­ful that it will be of good qual­ity.

“That’s an es­ti­mate, but they’re ba­si­cally price­less,” he said. “£150 might not sound like much, but that’s a high amount for sake,” said Mr Sato.

“I think they’ve been heav­ily un­der­priced – this com­pany has good po­ten­tial and only a few tiny com­pa­nies did this, so there are not many bot­tles out there.”

Ex­perts say the stan­dard of sake in the in­ter­na­tional mar­ket has his­tor­i­cally been poor. Com­pa­nies ex­ported the bot­tles that could not find buy­ers in Ja­pan, which tended to be of lower qual­ity.

Only within the past three years, said Mr Sato, has more pre­mium sake started to be ex­ported, mostly to New York, Paris and Lon­don.

A hand­ful of bou­tique sake mak­ers are tar­get­ing the pre­mium Lon­don mar­ket, hop­ing to sell high-qual­ity bot­tles to restau­rants and nightclubs.

Many of them are also start­ing to bot­tle va­ri­eties de­signed to be kept for longer, and the tech­niques used to cre­ate va­ri­eties that will last for a long time is im­prov­ing.

For those want­ing to get into the mar­ket, sake should be kept at tem­per­a­tures around three to five de­grees cooler than those ideal for wine, but like wine should be ide­ally kept in dark con­di­tions.

In the UK, bot­tles can be bought at spe­cial­ist re­tail­ers in­clud­ing He­do­nism Wines and Tengu Sake.

As with wine, cau­tioned Adrian Low­cock, of in­vest­ment com­pany Ar­chi­tas, sake is an in­vest­ment best made by en­thu­si­asts or in­vestors with spare cash that they can af­ford to spec­u­late with.

“An in­vest­ment in sake is a bit like fine wines or clas­sic cars. They are quite dif­fi­cult to value – a bot­tle of wine or sake is only re­ally worth what some­one else is will­ing to pay for it.

“That means the price can fluc­tu­ate quite a lot de­pend­ing on sen­ti­ment and fash­ion trends,” he said. One way to cap­i­talise might be to in­vest in the com­pa­nies that will ben­e­fit from any in­crease in the pop­u­lar­ity of sake and Ja­panese food and drink in­ter­na­tion­ally. One of these is drinks com­pany Di­a­geo, which has cre­ated Ja­panese-in­flu­enced gins and spir­its. Danny Cox of in­vest­ment com­pany Har­g­reaves Lans­down rec­om­mended Lind­sell Train Global Eq­uity as the top fund choice to get ex­po­sure to the com­pany. An­other op­tion is Ja­panese drinks com­pany Sun­tory. How­ever, this is listed on the Tokyo stock ex­change and to buy shares you would need to find a bro­ker that can deal in Ja­panese shares – not an easy task. An­other in­vest­ment op­por­tu­nity is of­fered by sake start-ups based in the UK, as sev­eral small brew­ers are launch­ing this year or next. Two Bri­tish brew­ers – one in Scot­land and an­other in Cam­bridgeshire – are launch­ing this year alone. One en­thu­si­ast, Andy Travers, 34, from Lon­don, said: “If the trend con­tin­ues to grow and the de­mand in­creases, and sake does break a bit more into the main­stream, new brew­ers are be­ing set up. “That could be an op­por­tu­nity for in­vest­ment.”

‘Sake is a bit like fine wines or clas­sic cars – they are quite dif­fi­cult to value’

En­thu­si­ast: Andy Travers ex­pects more UK sake com­pa­nies to launch soon

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