Month: August 2023

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Is sustainable wine the next big investment trend?

  • Sustainability in wine encompasses various processes such as environmental stewardship, social responsibility, and long-term financial viability.
  • Sustainability appeals to a growing group of investors who want their money to do good while it grows.
  • Top wineries implementing sustainable practices include Bodega Catena Zapata and Château Pontet-Canet.

The wine investment market has diversified considerably in recent years, with sustainability becoming a core focus. As examined last week, environmental considerations are the number one reason why UK investors choose to invest in fine wine. Today’s article explores the criteria for sustainable wine, its appeal, risks and considerations, as well as the future prospects for this important market segment.

Defining sustainable wine

Sustainability in wine is a nuanced concept that goes beyond certifications like ‘organic’ or ‘biodynamic’ that you might find on a bottle’s label. These certifications are positive indicators but they do not provide a complete picture of a wine’s overall sustainability or its quality. In fact, while organic and biodynamic practices are steps in the right direction, they are not panaceas for all environmental challenges facing vineyards and wineries.

Truly sustainable wines are produced with a broader vision that encompasses not just environmental considerations, but also social and economic aspects. This holistic approach involves responsible land use, ethical labour practices, and a focus on long-term financial viability for producers.

Organic, biodynamic, and sustainable – what is the difference?

Organic wines are made from grapes grown without synthetic pesticides or fertilisers. Biodynamic wines take this a step further by integrating the vineyard into a self-sustaining ecosystem.

Sustainable wines, however, encompass a broader range of practices aimed at the long-term viability of the entire wine-producing operation. Various certifications, such as ‘Certified California Sustainable Winegrowing’, exist to label these wines officially. Organisations such as Sustainable Wine work to enhance clarity around sustainability in the industry as a whole from viticulture to packaging solutions and logistics.

The appeal of sustainable wines

Sustainability appeals to a growing cohort of investors who want their money to do good while it grows. Investing in sustainable wines satisfies this ethical imperative, thereby adding another layer of attraction to the investment.

Studies indicate a rising demand for sustainable products, including wine. This increased consumer demand means greater sales potential and, by extension, a probable rise in value for these wines over time.

Sustainable wines often come with compelling stories of environmental stewardship and community support. This narrative adds a unique selling proposition that can boost brand value and investment potential.

Risks and considerations

Like any investment, putting money into sustainable wines is not without risk. Market volatility, consumer preferences and supply and demand can impact returns as with any other investment-grade wine.

Another risk lies in the potential for ‘greenwashing’, where a wine’s eco-friendly credentials can be exaggerated. Investors must perform due diligence to ensure they are backing genuinely sustainable ventures.

How to invest in sustainable wines

The first step is comprehensive research: utilising online resources, expert reviews, and consumer reports to assess a wine’s investment potential and sustainable credentials. Diversifying your portfolio by including a mix of sustainable wines from various regions and price points can mitigate risks and increase the potential for rewards.

Pay close attention to ratings from renowned wine critics and industry experts. A high rating can significantly impact a wine’s market value.

Sustainability pioneers

Several wineries around the world are setting the bar high for sustainable practices. Frog’s Leap in Napa Valley is known for its organic and dry farming techniques. Germany’s Weingut Wittmann has also embraced organic farming and natural winemaking processes. In Argentina, Bodega Catena Zapata stands out for its sustainable farming and research into high-altitude winemaking. Château Pontet-Canet in Bordeaux is another success story, having converted to biodynamics in 2014 after various setbacks in 2007. Their journey underscores the long-term dedication needed for truly sustainable winemaking.

Future outlook

From water-saving technologies to renewable energy, the wine industry is continually adopting more sustainable practices, pointing to a robust market future. Experts predict the demand for sustainable wines will only grow, particularly as younger generations who prioritise sustainability come of age.

Sustainable wines present a captivating new frontier in wine investment, promising both ethical satisfaction and financial gains. As with any investment, there are risks, but the burgeoning market for these wines, coupled with their unique branding advantages, makes them a trend worth watching. For investors willing to do their homework, the opportunity is ripe for the picking.

WineCap’s independent market analysis showcases the value of portfolio diversification and the stability offered by investing in wine. Speak to one of our wine investment experts and start building your portfolio. Schedule your free consultation today.

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The brands to watch in the 2023 autumn La Place de Bordeaux campaign

  • La Place de Bordeaux is a three-tier global wine distribution system with origins stretching back 800 years.
  • The autumn La Place de Bordeaux campaign sees the release of over 100 different wines from around the world.
  • Discover the brands released via La Place that have made the biggest gains over the past decade.

La Place de Bordeaux is a global wine distribution system that originated 800 years ago in France. The network was originally a hub used just for Bordeaux’s finest wines, where the château would sell to négociants who then sell to merchants.

In recent years, the system has considerably expanded its operations. Other than the spring Bordeaux En Primeur campaign, today La Place releases wines from other parts of the world in the autumn.

Over 100 different wines from Argentina, Australia, the USA, New Zealand, Austria, China, Italy, Spain, South Africa, Uruguay and French wines from Champagne and the Rhône have joined the marketplace since the first non-Bordeaux release of the Chilean brand Almaviva in 1998.

What is driving the La Place expansion?

By selling through La Place, producers have the opportunity to build a global following for their brands, benefitting from the négociants’ extensive reach and expertise in promoting and allocating wines to different markets. Meanwhile, this process guarantees the wines’ provenance, reduces risk, and effectively manages supply and demand.

Négociants also benefit from the expansion of the system beyond Bordeaux by diversifying their revenue streams and reducing their dependency on the châteaux. This is especially true in recent years, which have seen a declining sentiment for buying Bordeaux En Primeur (for more, see our En Primeur Report: Bordeaux 2022 – Unfulfilled Potential).

The transformation of La Place de Bordeaux also reflects the shift in broadening buying patterns in the fine wine investment market.

La Place brands to watch

This autumn will see the release of close to 120 wines from around the world through La Place de Bordeaux.

Some of the most anticipated releases each year include the Super Tuscans Solaia, Masseto and Bibi Graetz, Californian cult wine Opus One joined by estates such as Inglenook, Joseph Phelps and Promontory, the Chilean Almaviva, Vinedo Chadwick and Viña Seña.

Australian wine, which has faced challenges due to the ongoing Chinese tariffs in recent years, has also been aided by the network, with brands such as Penfolds and Jim Barry making waves.

La Place brands

*Explore the performance of different wines on Wine Track, our comprehensive fine wine index that enables you to identify investment grade wines, spot trends and wine investment opportunities.

The table above shows some of the best-performing wines released via La Place over the past decade. These wines, available at various price points, have delivered an all-round positive performance over the past five and ten years.

Rothschild & Concha Y Toro’s Almaviva has seen the most impressive price performance over the last decade, up 132%. Almaviva prices tend to rise with age, and the highly anticipated 2021 vintage is expected to be among the first releases of this autumn’s campaign.

In conclusion, the network’s continually broadening selection showcases its ability to adapt and thrive in a fluid market, acting simultaneously as an indicator of shifting consumer preferences and investment opportunities. As négociants broaden their range and producers tap into this distribution channel with global reach, the impact is poised to resonate well beyond the borders of Bordeaux.

WineCap’s independent market analysis showcases the value of portfolio diversification and the stability offered by investing in wine. Speak to one of our wine investment experts and start building your portfolio. Schedule your free consultation today.

 

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The impact of climate change on wine investment

Climate change and wine investment
  • Environmental considerations are the number one reason why UK investors choose to invest in fine wine.
  • Fine wine itself is facing the effects of climate change such as reduction in yields.
  • Scarcity can drive demand and prices higher, but also lead to the broadening of the fine wine market.

Climate change and environmental considerations are the number one reason why UK investors choose to invest in fine wine, according to the results of our Global Wealth Manager Survey 2023. Over half (54%) of our respondents cited fine wine’s low carbon footprint as a key reason for adding it to their portfolio.

While there is a strong case why fine wine can be considered an ESG investment that is a good for the environment, fine wine itself is facing the impact of climate change. Like all agriculture, viticulture is at the mercy of the environment, making climate change a pressing issue for wine investors.

Changing weather patterns affect wine quality and quantity – two of the main factors that can make an investment profitable.

How changing weather patterns affect wine quality and quantity

In general, climate change can lead to alterations in grape ripening cycles, water stress, diseases and pests, and can affect berry size and composition.

Rising temperatures can cause early ripening, potentially disrupting the balance of sugars, acids and tannins – factors crucial for the quality of the wine and its ageing potential. Meanwhile, drought and irregular rainfall can lead to excessive water stress in the vines, affecting fruit development. Warmer temperatures can also bring new pests and diseases to regions previously unaffected, while heatwaves can cause grapes to sunburn, reducing yield and quality.

For instance, in 2023, two of the main fine wine producing countries, France and Italy, faced diverse weather patterns. France’s 2023 wine harvest projects between 44-47 million hectolitres, benefiting from potentially strong yields in Champagne and Burgundy. Italy, however, might see up to 14% reduction in yields due to extreme weather, marking it among its smallest harvests.

What does this mean for fine wine investment

Smaller harvests lead to reduced supply, and assuming that demand remains constant or increases, prices tend to rise. When news of a small harvest breaks, especially from a reputable wine-producing region, it can create a buzz in the trade. Buyers and collectors might perceive wines from that harvest as more valuable or unique, driving up demand and, subsequently, prices.

Moreover, a smaller harvest doesn’t necessarily mean reduced costs. Wineries still have to maintain vineyards, pay labour, and cover all production expenses. With fewer bottles to sell, the cost per bottle increases, which can result in higher prices for the consumer.

Supply and demand

This is a particularly pertinent question for regions, where scarcity is the main driver behind their investment appeal such as Burgundy. A recent example was the 2021 Burgundy En Primeur campaign, which saw drastically low volumes. The Bourgogne Wine Board (BIVB) pointed to a crop of 900 to 950,000 hectolitres, representing about 50% of a normal year and 2/3 of the average in recent years.

As a result, allocations were low and release prices were up 25% on average. This stimulated demand for older vintages at comparatively low prices, such as 2012, 2014 and 2017, as examined in our Q1 2023 report.

Overall, climate change can create scarcity in the market, pushing the entry point into some fine wine regions higher.

The broadening fine wine market

The rarity of some wines is leading buyers to also consider alternatives from other regions, impacting the size of the market. Today there are more fine wine investment opportunities than in any other point in history.

Changing weather patterns have also led to the emergence of new wine producing regions. For instance, England is now producing award-winning sparkling wines, due to warming temperatures. The country is still a niche player in the investment market, but some brands such as Nyetimber and Gusbourne Estate are making waves.

Climate change is reshaping the fine wine market, with some of the traditional regions forced to adapt their strategies. It is more than an abstract global concern; its palpable effects are shaping the fine wine industry, from agriculture to investment.

WineCap’s independent market analysis showcases the value of portfolio diversification and the stability offered by investing in wine. Speak to one of our wine investment experts and start building your portfolio. Schedule your free consultation today.

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Italian fine wine shows resilience amid market corrections

  • Italian fine wine has demonstrated resilience during the market’s latest corrective phase.
  • Piedmont and Tuscany have shaped the Italian fine wine market in complementary ways.
  • In the last year, Bibi Graetz Testamatta has been the best performing brand from Tuscany, up 93%, while Marchesi di Barolo Riserva has led the way in Piedmont, up 128%.

Italy has been a beacon of stability during the fine wine market’s latest corrective phase, which has seen prices fall 7.5% over the last year. The Italy 100 index has dipped just 0.4% during this time, but many of its top wine brands have continued to make considerable gains.

Italy’s stability is more than just a short-term trend; its long-term performance has been characterised by low volatility and steady returns. Its index has risen 286% in value over the last two decades, driven by growing demand for Italian fine wine, and quality improvements.

Indeed, the top wines of Piedmont and Tuscany compare favourably to Burgundy and Bordeaux in terms of critic scores, yet prices are often lower. Italy entices buyers with lower-cost access into the fine wine market, and the diversity of its offerings. On average, one can get a case of the top Super Tuscans (Tignanello, Sassicaia, Ornellaia) for £2,129; the First Growths (Mouton Rothschild, Haut-Brion and Margaux) cost more than double.

The complementary performance of Piedmont and Tuscany

Two major regions have played pivotal roles in shaping the Italian fine wine market in complementary ways: Piedmont and Tuscany.

Piedmont’s top wines, chiefly made from the native Nebbiolo grape, are produced in limited quantities, with rarity and exclusivity driving demand and prices. The dynamics behind the region’s performance evoke comparisons with Burgundy (and its signature Pinot Noir), where scarcity intensifies the allure. Historically, Piedmont has been the chief driver behind Italy’s rising prices.

Meanwhile, Tuscany has greatly contributed to cementing Italy’s place on the global fine wine stage, and its increasing market share. The brand strength of the Super Tuscans, combined with high quality, greater volumes and solid liquidity, have given the Italian market a significant boost.

The best performing brands in the last year

Piedmont

*Explore the performance of different wines on Wine Track, our comprehensive fine wine index that enables you to identify investment grade wines, spot trends and wine investment opportunities.

Marchesi di Barolo Barolo Riserva leads the way among Piedmont’s biggest risers, up an impressive 128% in the last year. However, the rest of the wines have made gains between 39% and 47%.

Tuscany

From Tuscany, Bibi Graetz Testamatta has seen the biggest rise in value in the last year, up 93%. The wine has an attractive point of entry, with an average case price of £1,530. Some of its best value vintages include 2011, 2012, 2015 and 2016. The 2021 vintage is expected to be released next month, as part of this autumn’s La Place de Bordeaux campaign.

The rest of Tuscany’s best performers have risen between 40% and 67%, with Antinori’s Guado al Tasso at the higher price end and Montevertine Rosso being the lowest priced.

The significant growth observed in individual brands from both regions accentuates Italy’s investment potential. Despite the recent bearish trend in the market, Italy has continued to deliver and attract greater demand.

WineCap’s independent market analysis showcases the value of portfolio diversification and the stability offered by investing in wine. Speak to one of our wine investment experts and start building your portfolio. Schedule your free consultation today.

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Risk tolerance in investing: the role of fine wine

  • Risk in investing refers to the potential for higher long-term rewards but also the possibility of losses.
  • High-risk investments can provide significant returns, but they also come with increased potential for losses.
  • Fine wine can be a low-risk investment with high growth potential and a hedge against inflation.

Understanding risk in investing

In the context of investing, risk signifies the potential variability of returns. It reflects the likelihood that the actual return on an investment may deviate from its expected return, which could mean either losing money or making more than anticipated.

Risk is usually calculated using statistical measures such as standard deviation and variance, which represent the degree to which an investment’s returns can vary from its average return. Greater variability implies higher risk and vice versa.

What does risk tolerance really mean?

Contrary to popular belief, risk tolerance is not about being an adrenaline junkie or being willing to lose all your money. It’s about your ability to endure potential losses in your investment portfolio without panicking or making rash decisions.

Risk tolerance depends on various factors, including your financial capacity to absorb losses, your investment goals, your time horizon (the length of time you plan to keep your money invested), and your emotional comfort with uncertainty and potential loss.

In long-term investments, it can actually be riskier for your wealth to invest solely in traditionally “low-risk” assets. This is because these assets may not provide the growth needed to achieve your investment goals, especially after accounting for inflation.

High-risk investments: high return or high loss?

High-risk investments experience significant price volatility, such as equities, commodities, high-yield bonds, and currencies. These usually have the potential to generate substantial returns; however, they can also lead to significant losses, including the entire amount invested in some cases.

While high-risk investments can be a part of a diversified portfolio, it is crucial to only invest money that you can afford to lose in these types of assets. And, most importantly, these investments should align with your risk tolerance.

Fine wine: a low-risk asset with high growth potential

Fine wine presents an intriguing investment prospect, particularly for those with a lower risk tolerance. As a tangible, finite asset, fine wine tends to appreciate with time and offers a level of stability that is often appealing to risk-averse investors.

Moreover, fine wine has shown high growth potential, with certain wines appreciating significantly over time. Some of the best investments in the last five years have been Prieure Roch Vosne-Romanee Le Clos Goillotte (588%), Egly-Ouriet Brut Millesime Grand Cru (340%) and various wines from Domaine Leroy and Domaine Arnoux-Lachaux. Similarly, the fine wine regions that have seen the highest return on average in the last semi-decade have been Champagne (69.9%) and Burgundy (35.5%).

Our Wine Track tool allows you to explore the best performing wines over different time frames, the price point upon which they are available, and their average critic score.

Understanding risk and your personal risk tolerance is essential in making sound investment decisions. Whether it’s high-risk or low-risk assets, or a combination of both, the key is to align your investments with your personal risk tolerance and financial goals. With its unique attributes, fine wine offers an exciting avenue for those seeking lower-risk investments with substantial potential returns.

WineCap’s independent market analysis showcases the value of portfolio diversification and the stability offered by investing in wine. Speak to one of our wine investment experts and start building your portfolio. Schedule your free consultation today.

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2023 harvest forecasts for France and Italy: a balancing act

Harvest
  • France’s 2023 wine harvest projects between 44-47 million hectolitres, benefiting from potentially strong yields in Champagne and Burgundy.
  • Italy anticipates up to 14% reduction in its 2023 harvest due to extreme weather, marking it among its smallest harvests.
  • Historical trends showcase climatic vulnerabilities, emphasising the need for sustainable viticulture practices.

As harvest time approaches, we take a look at forecasts for the 2023 vintage in France and Italy. While France appears to be set for a stable year – in line with the five-year average, Italy’s harvest might shrink as a result of extreme weather, as climate change continues to leave its mark.

French wine regions face diverse conditions

According to the French agriculture ministry, France’s wine harvest in 2023 looks promising, with estimates suggesting a national production between 44 million and 47 million hectolitres. This figure nudges slightly ahead of the previous year’s 45.4 million hectolitres. One reason for optimism is the performance in regions like Champagne and Burgundy, which is expected to offset challenges in Bordeaux.

Indeed, Bordeaux has not had it easy. Consecutive thunderstorms, high temperatures, and downy mildew have plagued the region. Notably, Gironde’s chamber of agriculture reported that a whopping 90% of vines have been affected by downy mildew. Languedoc and Roussillon have also been suffering from persistent drought.

Meanwhile, Champagne and Burgundy are set for an above-average harvest. Champagne has successfully averted frost and hail damage and diseases have been contained. Similarly, Burgundy looks poised for grape production higher than the five-year average. The situation in neighbouring Beaujolais is also looking better than last year.

If projections hold, France may place as Europe’s largest wine producer in 2023, especially given the challenging outlook for Italy.

Italy’s climate woes

Italy is staring at a potentially reduced harvest in 2023. From searing heatwaves to devastating floods, the nation’s vintners have confronted multiple challenges. Extreme weather events could result in a harvest that is up to 14% smaller than in 2022. If this forecast proves accurate, 2023 could rank with years like 1948, 2007, and 2017 as one of Italy’s smallest harvests on record.

However, while the national outlook seems daunting, the situation varies by region. The north, including areas like Piedmont, Lombardy, and Veneto, has remained relatively stable despite recent fierce hailstorms. By contrast, southern and central Italy might see significant drops in production, with Sicily in particularly struggling with wildfires, heat, and mildew. Still, the Assovini Sicilia wine association noted that grape quality remains intact for 2023.

Historical context

France and Italy have witnessed harvest highs and lows over the decades. Historically, France’s most significant harvest was in 2004 with a record 58.3 million hectolitres. In contrast, 2017 saw a decline of almost 20% due to weather adversities.

Italy’s bumper harvest year was 1982, with a record production of 65 million hectolitres. The country’s most challenging years have been spaced apart, with significant lows in 1948, 2007, and potentially 2023.

In conclusion, the 2023 harvest projections for France and Italy offer a revealing snapshot into the challenges and opportunities presented by the ever-shifting climate. While France gears up for a potentially favorable yield, owing largely to robust performances in regions like Champagne and Burgundy, Italy grapples with the stark realities of climate change, which threatens to render 2023 one of its leanest harvests. These trends not only highlight the adaptability of the wine industry but also underscore the urgent need for sustainable practices and proactive measures to mitigate the impacts of adverse weather patterns on viticulture. As the historical data indicates, while wine-producing regions have faced fluctuations in the past, the growing unpredictability of climate patterns demands heightened vigilance and innovation in the realm of winemaking.

WineCap’s independent market analysis showcases the value of portfolio diversification and the stability offered by investing in wine. Speak to one of our wine investment experts and start building your portfolio. Schedule your free consultation today.

 

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The art of diversification: can fine wine create it?

  • Diversification is a risk management strategy that involves spreading investments across various financial instruments, sectors, and regions.
  • It is not just about different sectors and asset classes but also about different revenue streams.
  • Fine wine can serve as a practical alternative investment, providing portfolio diversification and being a hedge against inflation.

Understanding diversification

Diversification, often referred to as the only ‘free lunch’ in investing, is a cornerstone of modern portfolio theory. At its core, it is a risk management strategy used in investing where one spreads their investments across various financial instruments, sectors, and regions.

The goal of diversification is to mitigate risk by reducing the negative impact of a poor-performing investment on the overall portfolio. This is achieved by investing in assets that are not perfectly correlated. In simpler terms, when some investments are down, others may be up.

Debunking the diversification myth

A common myth in investing is that diversification only means investing in different sectors, asset classes, and locations. While these are significant aspects of diversification, it is not the whole story.

The essence of diversification is about establishing multiple revenue streams. The importance of different revenue streams cannot be overstated. The reason being, if one stream suffers due to economic downturns or sector-specific issues, the impact on the total income is cushioned by the performance of other streams. It is all about not putting all your eggs in one basket.

For instance, consider an investment portfolio that has stocks, bonds, and real estate investments. Even if the stock market faces a downturn, the bond market may still perform well, and rental income from real estate could continue to provide stable income. This way, different revenue streams ensure the portfolio remains balanced and resilient in the face of volatility.

Fine wine: an alternative avenue for diversification

When we talk about diversification, alternative investments often come into play. These can range from art and antiques to cryptocurrencies and fine wine. Fine wine as an asset class for investment purposes has been gaining traction over the past decade.

Fine wine offers several attractive characteristics as a diversification asset. It is tangible, finite, and its value tends to increase with age, making it a useful hedge against inflation. Moreover, the performance of wine as an asset class does not necessarily correlate with traditional financial markets, providing the much-needed diversification.

In periods of financial crisis, where traditional stocks and bonds may underperform, alternative investments like wine often remain steady or even appreciate. This is partly because they are driven by different demand dynamics – for example, the increasing global appreciation of fine wines, especially in emerging markets.

Investing in wine also offers the potential for impressive returns. A well-chosen wine portfolio can deliver strong performance over time. You can now see the best and worst performing wines over the last year on Wine Track.

Diversification within fine wine

Diversification also exists in the fine wine market. All wines are not made the same. Wines from different regions can deliver varying returns so it is important to have a broad understanding of the market dynamics that may affect performance over time.

For instance, rare Burgundies are known for delivering exceptional returns; however, the entry point tends to be higher, prices are more volatile, and the wines are harder to source. Bordeaux and the Rhône tend to offer greater stability at lower price points, but returns might not be as impressive.

Moreover, different factors may affect performance: while Champagne prices tend to exhibit greater correlation with age – as the wines mature, prices rise – the Bordeaux market tends to be influenced by critic scores and vintage quality. Scarcity, demand and supply, significant events, critic rankings, changes in ownership and the ‘death effect’ are other fine wine specific factors that can affect the performance of different regions.

In conclusion, while diversification may seem like a complex concept, it is a fundamental strategy in managing risk and ensuring the growth of your investment portfolio. Whether it is stocks, bonds, real estate, or fine wine, the idea is to spread out your investments, thereby creating different revenue streams to safeguard against market volatility. With its unique characteristics, fine wine offers an exciting opportunity to achieve portfolio diversification.

WineCap’s independent market analysis showcases the value of portfolio diversification and the stability offered by investing in wine. Speak to one of our wine investment experts and start building your portfolio. Schedule your free consultation today.

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The role of wine ratings in fine wine investment

  • Wine ratings play a crucial role in wine investment, with high scores from influential critics impacting demand and market value.
  • To use ratings effectively, investors should consider both the initial score and potential for growth.
  • The Wine Track score provides a broader view of a wine’s quality across multiple vintages and publications, helping investors assess wines at a glance.

In the fine wine market, few factors influence demand and long-term value as powerfully as wine ratings. For collectors and investors building an investment grade wine portfolio, scores from leading critics act as signals – not only of quality, but of longevity, market confidence, and future price potential.

However, while high scores often attract immediate attention, successful wine investment requires a deeper understanding of how ratings work, how they evolve over time, and how they interact with broader market forces such as global demand, scarcity, and drinking windows.

This article explores how wine ratings shape the fine wine market, how investors use them strategically, and why aggregated tools such as the Wine Track Score provide a clearer framework for assessing investment grade wines over the long term.

Why wine ratings matter for investment grade wine

Wine ratings emerged as a way to communicate quality quickly in an increasingly complex global wine industry. Today, they play a central role in shaping demand, pricing, and investor behaviour.

For wine investors, ratings provide insight into:

  • Quality and consistency across vintages

  • Longevity, including projected drinking windows

  • Market demand from collectors and consumers

  • Price stability in the secondary market

  • Investment potential relative to comparable wines

High scores from influential critics such as Robert Parker, Neal Martin, Jancis Robinson, James Suckling, and publications like Wine Spectator can materially affect prices – sometimes within days of publication.

As a result, ratings have become foundational to identifying investment grade wine, particularly for those seeking long-term capital appreciation rather than short-term trading.

How wine ratings influence the fine wine market

The fine wine market operates on reputation, scarcity, and trust. Ratings reinforce all three.

1. Ratings can drive immediate price movements

When a wine receives a benchmark score – especially 99+ or 100 points – it often enters a new tier of desirability.

A clear example is Marqués de Murrieta Castillo Ygay Gran Reserva Especial 2010, which saw rapid secondary-market price appreciation after being named Wine Spectator’s Wine of the Year. Similar reactions have historically followed 100-point scores awarded to Bordeaux First Growths and Burgundy Grand Crus.

For investment grade wine, wine scores act as a catalyst, accelerating demand and compressing supply.

2. Ratings shape long-term reputation

Consistent scoring matters more than isolated highs.

Producers such as:

  • Château Lafite Rothschild

  • Domaine de la Romanée-Conti

  • Harlan Estate

  • Gaja

  • Penfolds Grange

have built long-term investment credibility through repeated critical recognition. This consistency supports price resilience, even during broader market corrections.

For wine investors, this track record is a key differentiator between speculative wines and true investment grade wine.

3. Ratings influence regional prestige and global demand

Critics can also elevate entire regions, beyond just individual wines.

  • Robert Parker’s support helped propel Napa Valley into the global investment spotlight

  • James Suckling championed Super Tuscan wines, accelerating international demand

  • Jancis Robinson played a key role in highlighting Austria’s quality renaissance

As regional reputations rise, so does global demand – a crucial driver of long-term price appreciation in investment grade wine.

Ratings change over time – And so do investment opportunities

One of the most misunderstood aspects of wine ratings is that they are not fixed.

As wine matures in bottle, critics often revisit their assessments. Tannins soften, structure integrates, and complexity develops – sometimes leading to upward score revisions.

The impact of score changes

  • Upward revisions often trigger renewed buying interest

  • Downward revisions may stall demand or price momentum

  • Barrel scores can differ meaningfully from bottled assessments

This evolution creates opportunity for informed investors.

Strategic approaches for investors

  • Buy early when barrel scores and critic commentary are strong

  • Hold strategically as wines approach peak maturity

  • Sell your wine when demand aligns with optimal drinking windows

Understanding how ratings interact with a wine’s maturity curve allows investors to identify undervalued vintages before wider market recognition.

Knowing the critics and their influence on investment grade wine

Not all critics evaluate wine the same way.

Robert Parker, for example, historically favoured powerful, concentrated styles from Bordeaux, California, and the Rhône. As his influence has waned, the critical landscape has diversified, reflecting broader consumer preferences for balance, freshness, and terroir expression.

For wine investors, understanding critic bias is essential. A wine overlooked by one reviewer may be favoured by another, particularly in more divisive regions like Burgundy, Piedmont, or Germany.

This diversity reinforces the importance of looking beyond single scores when assessing investment grade wine.

The Wine Track score – ratings at a glance

To address inconsistency across critics, many investors now rely on aggregated metrics.

The Wine Track Score provides:

  • A unified 100-point score

  • Data from 100+ critics across 12 major publications

  • Vintage-by-vintage performance tracking

  • Insight into producer consistency over time

By smoothing out individual preferences, the Wine Track score offers a more holistic view of investment grade wine performance – particularly useful when comparing regions, estates, or vintages.

Using ratings strategically in a wine investment portfolio

Ratings are most effective when used as part of a broader framework.

1. Identify consistently high-scoring producers

Bordeaux First Growths, Burgundy Grand Crus, and top Napa Cabernet producers continue to anchor the fine wine market because of sustained critical support.

2. Look for sleeper vintages

Some wines receive modest early scores but improve significantly with age. These vintages often offer strong risk-adjusted returns.

3. Understand vintage variation

Even elite producers experience variability. Ratings help identify which vintages offer superior long-term value.

4. Use aggregated data

Relying on multiple critics reduces bias and improves decision-making.

5. Align with drinking windows

Wines approaching peak maturity often see increased demand from drinkers, supporting secondary-market pricing.

Ratings are powerful but not the whole story

While ratings are essential, they are only one part of evaluating investment grade wine.

Investors should also consider:

  • Producer reputation

  • Vineyard classification (e.g. Grand Cru, First Growth)

  • Market liquidity

  • Provenance and storage facility conditions

  • Historical price performance

  • Long-term global demand

Professional storage in bonded warehouses preserves quality and protects value – a critical factor when preparing to sell wine in the future.

Building a long-term investment grade wine portfolio

In today’s fine wine market, ratings remain one of the most influential tools available to investors. They help signal quality, predict demand, and highlight wines with the potential to outperform over time.

However, ratings are most effective when paired with market insight, disciplined storage, and a long-term perspective. When used intelligently, they can help investors build resilient portfolios anchored by true investment grade wine.

WineCap’s independent market analysis showcases the value of portfolio diversification and the stability offered by investing in wine. Speak to one of our wine investment experts and start building your portfolio. Schedule your free consultation today.