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Assessing the Burgundy 2022 En Primeur campaign

Burgundy 2022
  • Burgundy prices continued to spiral downwards in January, falling 3.7%.
  • This created a challenging backdrop for the unfolding Burgundy 2022 campaign, which saw about 10% of producers reduce pricing year-on-year.
  • The current market dynamics offer investors a unique window to enrich their collections with both new gems and proven performers.

Burgundy took the spotlight at the beginning of the year with the unfolding 2022 En Primeur campaign. Already in our Q4 2023 report, we questioned the potential of the new releases to stimulate an otherwise dormant market. On the one hand, there was the excitement of the new mixed with high quality and quantity playing to the campaign’s advantage; on the other, much depended on pricing.

Market conditions and pricing challenges

Burgundy prices continued to spiral downwards in January, with the Liv-ex Burgundy 150 index starting the year with a 3.7% decrease. To say that this created a challenging backdrop for the new releases would be an understatement. Prices at release had to come down.

And partially they did. According to Liv-ex, about 10% of the top producers ‘lowered their prices year-on-year’. However, ‘about 40% raised their prices, even if only modestly’. Thanks to greater quantities, allocations were mostly restored.

Burgundy 2022 – ‘a treasure trove’

As the first releases landed, Burgundy 2022 enjoyed a positive reception from critics and trade. Neal Martin (Vinous) advised that ‘if your favourite growers’ price tags seem fair, then I would not hesitate diving in’. He described the 2022 vintage as ‘Burgundy’s latest trick: a treasure trove of bright ‘n bushy-tailed whites and reds in a season that implied such wines would be impossible, wines predestined to give immense drinking pleasure’.

Investment perspective and older vintages

However, prices for older vintages remain under pressure, creating buying opportunities for already physical and readily available wines. For instance, three of Burgundy’s outstanding long-term wine performers have all seen dips between 15% and 10% in the last year. Over the last decade, however, DRC Vosne-Romanée Cuvée Duvault Blochet is up 388%; Georges Roumier Bonnes Mares – 339%, and Armand Rousseau Chambertin – 279% on average.

Burgundy wines performance

Meanwhile, the Burgundy 150 index has decreased 16% in the last year. Still, the overall long-term index trajectory remains upwards, as the chart below shows.

Burgundy index

Searching for value

The current market dynamics offer investors a unique window to enrich their collections with both new gems and proven performers across older physically available vintages.

When it comes to the latest, the Burgundy 2022 En Primeur campaign presents a complex tapestry of quality, quantity, and pricing amidst challenging market conditions. Despite initial price pressures, the adjustments made by producers and the positive critical reception underscore the potential of the new releases. Neal Martin’s endorsement further elevates the vintage, suggesting that for the discerning buyer, Burgundy 2022 provides not just immediate drinking pleasure but also long-term investment opportunities.

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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Learn

Price ratio: comparing regional First Growths

  • We compare the price performance of Château Lafite Rothschild to other regions’ respective ‘First Growths’.
  • The rising ratio highlights the increased value to be had in the Bordeaux First Growths.
  • Today, one can get 29 bottles of Lafite for the price of Romanée-Conti and almost five for Pétrus and Screaming Eagle.

How many bottles of Château Lafite Rothschild can one get for the price of other regions’ respective ‘First’ wines?

With changing market dynamics at play that have seen the balance between Bordeaux and other regions change, we examine the price ratio between some of the most popular investment-grade wines.

Below we compare the performance of the Bordeaux First Growth Château Lafite Rothschild to Burgundy’s highest echelon Domaine de la Romanée-Conti, the Super Tuscan Sassicaia, the Right Bank Château Pétrus, the Californian cult wine Screaming Eagle, and the most in-demand Champagne, Dom Pérignon. These are all wines that symbolise and even transcend their geography.  In the same way that Lafite has long been the mainstay of Bordeaux, the other wines are bellwethers for their regions.

The ratio between these wines is somewhat reflective of broader trends within their respective regions. Over the last decade, the ratio has risen consistently, highlighting the increased value to be had in the First Growths, as other regions gather momentum.

How many bottles of Lafite for the price of DRC?

Today, one can get on average 29 bottles of Lafite Rothschild for the price of Romanée-Conti. The ratio has risen considerably since 2013 when one could buy just 14 bottles of Lafite for one DRC. It peaked in December 2022, when it stood at 30:1.

As the chart below shows, the Domaine de la Romanée-Conti index hit a record high in December last year. Meanwhile, the Lafite index has not seen any of the price volatility witnessed by DRC. Year-to-date, prices for both labels have dipped but the fall has been sharper for DRC.

The DRC:Lafite price ratio is somewhat reflective of broader trends within their regions. In the last decade, Burgundy emerged as Bordeaux’s main contender. After Bordeaux peaked at the end of the China-led bull market in 2011, buyers started to seek out other corners of the fine wine world and it was Burgundy that attracted the greatest attention. The allure of rarity and quality meant that demand quickly outstripped already tight supply. Prices for Burgundy peaked, while Bordeaux ran quietly in the background.

For Bordeaux, the period between 2013 and 2015 saw contraction at the tail end of the Chinese correction. The market turned again in October 2015, and since then, Lafite Rothschild has been the second-best-performing First Growth, with some vintages doubling in value. However, it has not managed to catch up with Burgundy’s stellar rise.

Left vs Right Bank

It is also interesting to compare performance within Bordeaux’s Left and Right Bank. Today 4.6 bottles of Lafite gets you a bottle of Château Pétrus, up from 3, ten years ago.

As the chart below shows, Lafite and Pétrus have followed a similar trajectory up to September 2021, when prices for the First Growth flattened while Pétrus continued its rise.

Similar to Burgundy, rarity plays a key role in Pétrus’ appeal and investment performance. Pétrus is produced in much smaller quantities (around 3,000 cases per year) compared to Lafite (around 25,000 cases). Despite commanding a higher price tag, the wine has considerably outperformed Lafite in the last decade.

Dom Pérignon vs Lafite Rothschild

Recent years have seen a surge in Champagne’s market share and price performance. This has been reflected in the performance of its most traded label – Dom Pérignon.

Produced in much larger quantities than Lafite and more widely available, Dom Pérignon has started to catch up with the First Growth. In the last decade, the ratio between them has doubled – from 0.2 to 0.4.

Champagne prices, with Dom Pérignon at the helm, have made considerable gains since the early 2020s. In the last decade, our Dom Pérignon index is up 120%, compared to 20% for Lafite.

Sassicaia vs Lafite Rothschild

Similarly, the Super Tuscans have been getting more expensive. The most liquid and heavily traded group of Italian wines, their performance has been further boosted by critical acclaim and brand strength, with Sassicaia at the helm.

The ratio between Sassicaia and Lafite has risen from 0.2 ten years ago to 0.42 today.

As the chart below shows, Sassicaia has seen stable and consistent growth. 2019-2022 was a period of upheaval for the brand, which benefited from excellent vintages that captured investors’ interest.

Screaming Eagle vs Lafite Rothschild

The price ratio between Screaming Eagle and Lafite Rothschild tells a story of increased volatility, which can largely be ascribed to the Californian cult wine. Screaming Eagle has seen bigger price rises, followed by sharper falls.

Today one can now get 4.8 bottles of Lafite for the price of Screaming Eagle, up from 2.7 a decade ago. The ratio peaked in February 2022, when it stood at 5:1.

California has enjoyed serious investment interest which has been reflected in its market share. Today the region holds around 7% of the fine wine trade by value and is the most important New World player.

While Lafite has come to represent better value when compared to other top wines, this is largely due to shifting regional market dynamics. The First Growth continues to entice buyers with brand strength, high-quality releases and returns on 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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Insight

The DRC Ransom Plot

One of Burgundy’s most sought-out producers is Domaine de la Romanée-Conti (DRC). It was the Benedictine monks who were the first to recognise the Côte d’Or’s potential as a winegrowing area. They divided up and organised the parcels of land that produced the finest grapes. 

This piece of land was originally called ‘Le Cloux des Cinq Journaux’, then ‘Le Cros de Cloux’. After changing ownership many times after the monks tended the vines there, the plot was renamed as ‘La Romanée’ by the Croonembourg family. However, it wasn’t until 1760 that this legendary site was given its name that remains to this day. Louis-François of Bourbon – the Prince Le Conti – named it ‘Romanée-Conti’ when he purchased the 4.46 acre plot.

It is rumoured that the prince acquired the land as he discovered that his rival – Madame de Pompadour – who was also vying for the affection of the king, Louis XV, planned on buying the vineyard. The prince hired an agent to carry out his wishes and hoarded all the domaine’s wines for himself, throwing elaborate parties for his distinguished guests.

Domaine de la Romanée-Conti’s wines are some of the most eye-wateringly expensive in the world. Even having the means to purchase them doesn’t necessarily translate into being able to buy them as production levels are so low that only approximately 500 cases of La Romanée-Conti are made each year.

One villain – having discovered just how much the wines were retailing for – hatched a plan in 2010 to hold DRC’s co-owner and head winemaker, Aubert de Villaine, to ransom.

Having made detailed drawings of the vineyard and, shockingly, having poisoned two of DRC’s vines with herbicide already, the crook sent a ransom letter, addressed to Villaine. In it, they demanded €1.3 million from the estate, otherwise they would poison the remainder of the historic vines. 

It transpired that the culprit wasn’t as cunning as you’d have thought. Villaine enlisted the help of private investigators who delivered the ransom money to the specified location and a certain Jacques Soltys retrieved a parcel full of false notes and was met by police who were lying in wait.

After such an ordeal, things returned to normal at the estate. The grapes were picked, fermented and transformed into the 2010 vintage that, unsurprisingly, was proclaimed to be one of the all-time greatest years. 

Search for all of DRC’s wines and find out their performance on Wine Track.