Tag: Wine Investment

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Champagne’s financial bubbles: rising costs spark concerns over affordability

Champagne
Champagne
  • Rising production costs and inflationary pressures in Champagne have raised concerns around its accessibility and its appeal to consumers.
  • Higher interest rates pose challenges for financing grape supplies, potentially eroding profit margins for smaller Champagne producers.
  • Champagne’s investment market has also been undergoing a similar shift, which has diminished its relative affordability compared to other fine wine regions.

Champagne has experienced a period of remarkable success, with a new record turnover set for the region in 2022, The Drinks Business highlighted in an article this week. However, leading figures in the region have noted that inflationary pressures and rising production costs could potentially make Champagne too expensive. This is a particular concern at the lower end of the market where fixed costs make up a larger proportion of the value of the wine and the need to keep prices affordable is more pronounced. But prices have come under pressure in the secondary market too, which has shifted its dynamics.

Champagne’s rising costs spark concerns among smaller producers

The escalating prices of grapes, along with increasing costs of labour, energy, packaging materials, and glass, have placed significant financial pressures on some Champagne houses. According to the article, the price of grapes from the 2022 harvest rose by as much as 10% compared to the much smaller 2021 vintage.

Rising interest rates, which were sitting below 1% two years ago and have now reached 3% and higher, have added extra pressure on financing grape supplies, potentially eroding profit margins of smaller producers. Meanwhile, various packaging materials, including paper, foils, cases, and glass, are up by around 40%.

The rising production costs may lead to further price increases for Champagne. This situation raises concerns around Champagne’s accessibility and its appeal to consumers. Some producers fear that higher prices could deter customers and potentially drive them towards alternative sparkling wines.

The shifting dynamics of Champagne’s investment market

The dynamics of Champagne’s secondary market have also been undergoing a clear shift. Previously, everything seemed to work in Champagne’s favour: abundant stock, strong distribution, consistent demand, and relative value compared to other fine wines.

Speculators have taken advantage of Champagne’s strengths, fuelled by a string of excellent vintages that increased demand. This has altered the traditional rules of the Champagne market, as speculators often hold onto their stock without consuming it, resulting in potential oversupply. The sustainability of rising prices in the face of a potential stock overhang can present a challenge.

Meanwhile, the rising price of Champagne has diminished its relative price advantage compared to other fine wine regions. Previously considered an affordable entry point into the world of fine wine, Champagne’s average prices now rival those of Bordeaux. For instance, the average case price of Krug Vintage Brut (£5,001) is higher than that of the First Growth Château Haut-Brion (£4,802).

Champagne vs Bordeaux

*Over the last five years, Champagne prices are up 76.8%, compared to 15.3% for Bordeaux. Champagne experienced stellar price performance between mid-2021 and the end of last year. Year-to-date, its index is down 9.1%.

Some producers have also displayed an ambition to raise prices. Notable brands, such as Philipponnat’s Clos des Goisses and Lanson’s Le Clos Lanson, have joined La Place de Bordeaux, signaling their intent to push their brands. Last year, François Pinault’s Artemis Group acquired a majority stake in Champagne Jacquesson. While this highlighted Champagne’s investment potential, it also indicated a departure from offering wines at entry-level prices.

All of this presents a complex landscape for Champagne’s future pricing and market positioning; particularly, for smaller more affordable producers, less able to spreads costs over multiple products and absorb the rising costs. Is the era of affordable Champagne over?

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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Joseph Drouhin expands vineyard holdings to meet rising Burgundy demand

Joseph Drouhin
  • Joseph Drouhin has acquired two properties, Château de Chasselas in Saint-Véran and Rapet in Saint-Romain.
  • The expansion comes as both producers and buyers seek to find stock and value in an increasingly competitive market for Burgundy.
  • Drouhin has been a brand on the move, with some of its wines rising near 40% in value in the last year.

Joseph Drouhin expands its vineyard holdings 

Rising demand for Burgundy has fueled winery purchases and new investments. One of the most prominent producers, Maison Joseph Drouhin, has expanded its vineyard holdings with the recent acquisition of Château de Chasselas in Saint-Véran and Rapet in Saint-Romain.

Frédéric Drouhin, president of the Maison, explained that this decision was driven by increased competition and challenges in acquiring vineyards and purchasing grapes. The purchase focuses on high-quality yet more affordable areas in Burgundy – outside the main Côte d’Or villages, as both producers and buyers seek to find value in a region that has experienced significant price increases in recent years.

Just in the last five years, Burgundy fine wine prices have risen 75.7% – more than seven times the prices of the Bordeaux First Growths.

Burgundy vs Bordeaux prices

The insatiable demand and investment interest in the region have also impacted the cost of land, creating something of a vicious circle. 

The price of the latest Drouhin purchase was not disclosed.

The estates

Château de Chasselas encompasses 17.3 acres and is already a major supplier of Drouhin’s Saint-Véran wine. The property also includes small parcels in Chasselas and Beaujolais. The Rapet estate spans 19.8 acres and includes both Pinot Noir and Chardonnay vineyards in Saint-Romain, as well as small parcels in Auxey-Duresses, Pommard, and Meursault.

The debut vintage of Drouhin’s Saint-Romain wine is the 2022, while the first bottling of Saint-Véran Château de Chasselas will be the 2023 vintage, which will be released in 2024. All the newly acquired vineyards are being transitioned to organic farming practices.

With these acquisitions, Maison Joseph Drouhin owns close to 250 acres of vineyards, spanning from Chablis to Mâcon and encompassing 60 appellations. Their portfolio includes 14 Grands Crus and 20 Premier Crus. 

Drouhin’s place in Burgundy’s secondary market

Joseph Drouhin has been a Burgundy brand on the move. The brand jumped 142 places in the 2022 Power 100 rankings, thanks to its price performance. 

Four wines from the estate also ranked in the first tier of the 2021 Liv-ex Classification, which ranks the wines of the world solely by price: Montrachet Grand Cru Marquis de Laguiche, Musigny Grand Cru, Chambertin-Clos de Bèze Grand Cru, and Chambolle-Musigny Premier Cru Les Amoureuses.

The best performing Drouhin wines

In the last year alone, the best performing Joseph Drouhin wines have risen between 13% and 39%, outperforming the Burgundy 150 index. 

The biggest riser has been their Beaune Premier Cru Le Clos des Mouches Rouge, which has an average price of £1,403 per case.

You can now explore the historic performance of these wines on Wine Track. Our tool provides a clear overview of a fine wine’s track record, including critic scores, average price and investment 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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Moët Hennessy’s new organic certifications reflect a growing trend in the wine industry

Terrazas de Los Andes
  • Moët Hennessy has achieved new organic certifications for three estates, highlighting their commitment to sustainability and soil health initiatives.
  • The wine industry has seen a rise in organic wineries as more producers adopt sustainable practices to promote soil health, biodiversity, and natural pest control.
  • This is not only beneficial for the environment but presents an opportunity for ESG investors.

Moët Hennessy achieves new organic certifications

Moët Hennessy has achieved new organic certifications for three of its estates as part of its sustainability initiative called ‘Living Soils Living Together’, the drinks business reported.

One of the accreditations was granted to Château Galoupet in Provence, recognising its commitment to soil regeneration and soil health initiatives.

Additionally, two wine estates in Argentina, Chandon Argentina and Terrazas de Los Andes, were awarded the Regenerative Organic Certified (ROC) status by the non-profit organization Regenerative Organic Alliance.

In line with the program, Moët Hennessy had previously committed to ceasing the use of herbicides in its Champagne vineyards.

The rise of organic wineries

Moët Hennessy is not alone in its pursuit of a greener future. There has been a noticeable increase in the number of wineries adopting organic practices in recent years. The organic wine movement has gained significant momentum as consumers and wine investors have become more conscious about sustainable and environmentally friendly products.

Wineries are transitioning to organic farming methods to reduce their use of synthetic chemicals, pesticides, and herbicides in grape cultivation. Such practices focus on promoting soil health, biodiversity, and natural pest control, resulting in healthier vineyards and potentially higher quality grapes.

Renowned organic producers

Some of the most renowned organic producers include Burgundy’s Domaine Leflaive, and the Bordeaux Fifth Growth estate, Château Pontet-Canet.

While not officially certified, Burgundy’s Domaine de la Romanée-Conti also adheres to organic and biodynamic principles in its vineyard management and produces some of the most sought-after wines in the world.

A sustainable investment asset

The increasing adoption of organic and sustainable practices by wineries is not only beneficial for the environment but also presents an opportunity for wine investors. The influence of Environmental, Social and Governance (ESG) factors over investment portfolios has grown dramatically in recent years.

Indeed, fine wine can be considered an ESG investment for the following reasons:

  1. Vineyards are a carbon sink. A rugby-pitched-sized area of vineyard soaks up a respectable 2.84 tonnes of carbon every year.
  2. Soil quality can be enhanced through fine wine. Soil degradation is hot on the radar for concerned environmentalists.
  3. Organic wine production supports pollinators. Organic or pesticide-free vineyards – often one of the hallmarks of fine wine – helps bees and other pollinators get back on track.
  4. Fine wine is fighting back against single-use plastic. Unlike disposable plastic, fine wine glass bottles are something to be treasured.
  5. Vineyards help fill rocky terrain and hills with plants. The higher altitude acts as a natural pesticide, making it much easier to create organic wines.

The combination of sustainable practices and investment potential makes the growing trend of organic wineries a positive development in the wine industry.

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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Diversifying retirement portfolios: Why pension fund managers are turning to fine wine

pension funds
  • Pension funds have increased investment in alternative assets like fine wine by 25% over the past two decades.
  • Fine wine provides stability and intrinsic value for pension planners, as it is unaffected by geopolitical events or high inflation levels.
  • Fine wine has delivered impressive returns of 40.3% over the past five years, making it an ideal asset for retirement planning and diversification.

Change is in the air. As both the bond and equity markets get shaken by turbulence, pension fund managers are increasingly turning to alternative assets, to hedge against economic shocks. According to one report, pension funds around the world have increased their exposure by 25% over the past two decades. The New York Teachers Retirement System, for example, is plunging a whooping 35% of money into alternative investments.

Private equity, property, hedge funds and commodities are among the most enduring alternative assets. However, little by little, institutional investors are dipping into collectibles like fine wine too. One of Canada’s mightiest pension funds, The Public Sector Pension Investment Board, recently acquired 35 iconic vineyards. Goldman Sachs has also been investing heavily in wineries, with a focus on medium and longer-term returns.

In this article, we’ll unveil what’s making wine so appealing to managers today, and how investors could use this unique asset to bolster their own retirement funds.

Fine wine’s intrinsic value is reassuring for pension planners

Unlike most other investments, wine’s world-famous flavors are not impacted by geo-political events or high inflation levels. Instead, they are affected by storage and temperature.

This gives investors – including fund managers – a welcome sense of reassurance. While they may have no control over the stock market, they can ensure that the wine is well cared for.

Over the decades, retirement planners can rest assured that their wealth is not subject to the twists and turns of the stock market. Instead, it comes from the intrinsic value and exquisite quality within the bottle. This can help to mitigate risk and offer valuable diversification.

Investors can find a bottle to match their retirement timeframe

One of the greatest appeals of fine wine is how it improves over time. Naturally, it’s an asset that complements decades-long investment strategies, like retirement plans.

As our CEO, Alex Westgarth, recently commented for Forbes, ‘Fine wine pairs well with younger investors with long-term horizons. A good Bordeaux, for example, can age up to 50 years. This can add a certain stability to your portfolios’.

An excellent wine will always be in high demand as it reaches maturity. And there will almost always be a passionate buyer willing to pay premium prices.

A great advantage for pension planners is that they can probably find a bottle on the market to match their retirement timeframe. While some wines might be best opened in fifty years, others may need just five. Finding the right wine for your unique timeframe can help you to hedge against market losses and meet your investment goals.

With time, premium bottles become rarer

As poet, playwright and novelist, Johann Wolfgang von Goethe famously quipped, ‘Life is too short to drink bad wine’. Ultimately, the asset is made to be enjoyed. People open investment grade wine to celebrate occasions or present as gifts. And, with time, certain vintages will become harder and harder to find.

When demand outstrips supply, prices increase. That’s another reason why long-term investments in wine can be a sensible alternative asset for pension planning.

As the climate crisis continues to impact vineyards, the scarcity factor is likely to further increase prices. The delicate and unique flavors in already-bottled wine could be the last of their kind within just a few years. This will further reduce supply.

Meanwhile, demand is growing by the day. The past decades have seen an impressive rise in Millennial and Gen-Z buyers. Sotheby’s have even noticed the average purveyor’s age shrink from over 60 to under 40.

What’s more, the vast surge of digital advancements are also bringing in new generations and groups of wine buyers.

If demand continues to grow, the tightening supply should lead to a continued increase in value.

Fine wine has an impressive record of beating inflation

There are several reasons why most pension funds begin by investing in equities. It’s partly because managers can afford to take on more risk with longer timeframes. But it’s also to avoid the devastating effects of inflation. Unlike cash, bonds or other debt instruments, equity is generally more inflation-resistant.

Fortunately, fine wine shares this same inflation-resisting quality. This could make it a strong contender for a pension investment plan.

Fine wine has a history of beating inflation. Since 2021, for example, while the UK has endured inflation rates of over 10%, the Liv-ex 1000 index has risen 33%.

During the middle and final investment years – when the pension pot is most at risk of inflation erosion – a healthy allocation to wine could help mitigate the risk.

Fine wine has a history of strong returns

Over the past five years, the fine wine has delivered returns of 40.3%, according to the Liv-ex 1000 index. What’s more, despite the incredibly erratic market, overall performance has been smooth and steady.

This makes fine wine a strong contender retirement planning. Fine wine has both growth and value characteristics, making it well suited for most pension plans.

How can fine wine be incorporated into a pension?

Usually the best way to add wine into private pensions – like workplace and Self-Invested Private Pensions (SIPPs) – is to speak to a financial advisor. This is because they can help you structure the fund in the most tax-efficient way.

When it comes to taxes, fine wine already has a head start. Fine wine is exempt from Capital Gains Tax. Because of this, your advisor may prefer to leave it out of a SIPP altogether and use the tax perks on other assets instead. But probably they would seek to allocate a proportion of fine wine into your overall retirement plan as a hedging asset or long-term growth generator. As an inflation-resistant and illiquid asset, wine generally lends itself to retirement planning well.

If you’d like to find out more about which wines could best suit your pension goals, we’d love to talk to you.

 

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Q1 2023 Fine Wine Report

Q1 2023 Report
Q1 2023 Report

Our Q1 2023 report has now been released. The report examines how the global financial turmoil of the first quarter impacted the fine wine market, the factors affecting demand, and the best performing wines and regions. Download your free copy today.

Key findings include:

  • Mainstream markets had a rollercoaster quarter, but fine wine remained relatively unaffected.
  • Fine wine prices have risen for two consecutive months after a slow start to the year.
  • Several Bordeaux 2011s enjoyed heightened demand and rising prices in light of Chinese New Year.
  • The Burgundy 2021 campaign was met with mixed sentiment from the trade due to low allocations and high prices.
  • Axel Heinz has left Ornellaia to join Château Lascombes and bring fresh life into the estate, which has been underperforming the Super Tuscan in recent years.
  • The spotlight is now on Bordeaux, with the En Primeur release of the 2022 vintage, which has been described as ‘very promising’.

Click below to download your free copy of our quarterly investment report.

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James Suckling releases Bordeaux 2022 report

‘A new benchmark’

James Suckling has released his report on the Bordeaux 2022 vintage ahead of the upcoming En Primeur campaign. The critic claimed that in the 40 years he has tasted Bordeaux in-barrel, he had ‘never come across anything like the 2022 vintage’.

2022 will stay in memory as one of the hottest years on record, featuring severe droughts and heatwaves. Despite the challenges, Suckling suggested that 2022 ‘gives us hope that both man and nature can adapt to these circumstance and produce outstanding wines, both red and white’.

He further observed that dryness and heat no longer mean bold ripeness in the resultant wines. Most winemakers have prioritised freshness and lower alcohol, ‘picking their grapes at optimal ripeness, with this “al dente” fruit giving a crunchy and clean character to the wines, with fine yet structured tannins’.

Suckling found the young wines to be ‘dynamic and fascinating’ and noted that ‘there was high quality from top to bottom’ – a sign of a great vintage.

Top-scoring wines

Suckling found nine candidates for perfection in Bordeaux 2022, awarding them a barrel range of 99-100 points.

Cheval Blanc stood out as his potential ‘wine of the vintage’, which ‘soars to new heights with its brightness and weightlessness’.

The critic was also full of praise for two Sauternes from Château Lafaurie-Peyraguey, calling the Crème du Tête ‘magical. The new 1929?’

Only one First Growth made the list, Château Lafite Rothschild, which Suckling described as ‘a classical Lafite that reminds me of something like the 1986 […] but it’s so today with its purity and precision’.

A white wine also featured among the top-scoring – Pavillon Blanc du Château Margaux. According to him, this ‘feels like a great Montrachet’ and is ‘one for the cellar’.

The question of pricing

Suckling’s verdict on the 2022 vintage is that the quality of the wines is ‘exceptional’ but ultimately ‘the market will decide’ the success of the new releases. ‘High interest rates, volatile stock prices and recent bank failures’ are some of the factors that will influence purchasing of young Bordeaux.

While the excitement of the new is guaranteed, high release prices might make older vintages look more attractive – especially if they offer value, and faster 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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Fine wine as a value and growth asset

Fine wine value and growth asset

Fine wine offers the benefits of different asset classes. As a long-term investment, due to the inherent premise that it gets better with age, fine wine would traditionally fall under the ‘value asset’ category. This is especially true as investors tend to buy and hold wine for decades before selling at a premium. 

However, since fine wine is a highly sought-after and depleting investment, it shows tremendous growth characteristics too. Over the past year, fine wine has delivered strong returns, with some bottles increasing in value by as much as 550%. This makes it more akin to growth assets. 

Could fine wine be considered both a value and growth asset?

Value assets have intrinsic value and are usually undervalued

When investors talk about value and growth assets, they are generally referring to publicly-traded stocks. This could mean huge blue-chip corporations like Coco-Cola, Microsoft, or Tesla, or it could be little-known and up-and-coming stocks. Generally, the market is extremely efficient and so finding an underpriced stock is hard work. Those who dedicate time and research to discovering these undervalued assets are known as value investors. 

Warren Buffet is perhaps the most famous value investor of all time. “It’s far better to buy a wonderful company at a fair price than a fair company at a wonderful price,” he declares. For Buffet, seeking intrinsic value is the only real way to invest. Perhaps that is why he is such a fan of fine wine investments. Buffet has reportedly said that every portfolio should have at least a 1% allocation to fine wine. 

The value of fine wine can’t be measured the same way as a stock

To understand whether an investment offers good value or not, investors usually need to crunch a lot of numbers. But the process is a little harder outside of the stock market. Unlike traditional stocks and shares, analysts would be hard-pushed to calculate the price-to-earnings, debt-to-equity, or price-to-book ratios of fine wine. 

Firstly, this is because bottles, casks or barrels of fine wine do not offer “earnings” in the stock market sense. Bottles cannot pay dividends, and so buyers instead collect all their returns when they sell the asset.

Secondly, prices are variable. As fine wine is usually traded privately or through prestigious auction houses, the final sum is not always predictable – especially if you have two or more extremely passionate bidders in the room. As a result, bid-ask spreads are significantly greater than you’d find on the stock market. 

Finally, forecasting these values can be unreliable because in some cases wine prices are not always publicly available. However, as industry leaders, we do have a lot of this information. If you would like to get an insider idea of the latest auction results and performances, check Wine Track. 

While we may not be able to scrutinize the value of fine wine in the traditional sense, we can analyse the general trends and characteristics. From here, we can see how they hold up against traditional value stocks. 

Fine wine shares many of the long-term characteristics of value investments

As an asset class, fine wine behaves like a value investment. Some of the main characteristics are the “buy low, sell high” strategies, the long-term investment horizon, and stable financial returns. 

  • “Buy low, sell high” strategies 

Value stocks are generally underpriced on the market, meaning investors expect to make profits over time as the asset realises its true worth. This is remarkably similar to fine wine investments. Many purveyors will purchase the wine en primeur before it is even bottled to secure the best price.

At the time of writing, wines such as Domaine d’Auvenay have already delivered returns of nearly 8,500% over a ten-year period. This shows the incredible power of buying wine early, and holding. 

  • Buy and hold over the long-term

As the adage goes, fine wine gets better with age. High-quality Bordeaux, for example, takes 20-30 years to mature. Successful investors will generally buy and hold fine wine over the long-term. 

This approach mirrors the “value” philosophy perfectly. As Buffet himself warns, “If you aren’t willing to own a stock for 10 years, don’t even think about owning it for 10 minutes”.

  • Steady returns

Stability is another key characteristic of value investments. These assets should be able to sail through all kinds of market storms with minimal or zero disruption. Fine wine has delivered exceptionally stable returns over the last year, holding up against recessions and incrementally gaining value despite stock market chaos. 

Fine wine has compelling growth attributes too

On the face of it, fine wine seems to be a value investment. It is a steady long-term asset which gains value over time. Yet, despite its famous stability, this investment has also delivered some impressive short-term returns and it is an alternative asset, which push it more into the growth category. 

  • Fine wine is an alternative asset 

Investors looking for growth assets tend to accept volatility risk, as part of the trade-off for superior returns. Because of this, they are more inclined to look away from the reassurance of the stock market to find new revenue streams. Increasingly, unlisted property, private equity, hedge funds, high yield credit, long-duration bonds and alternative debt are finding their way into growth funds and portfolios.

 As an alternative asset, fine wine seems to fit snugly into the “growth” category. Yet, unlike these investments, fine wine is generally not volatile. 

  • Exceptional short-term returns 

Wine can, however, deliver exceptional short-term returns. Over just five years, fine wines such as Hubert Lamy have seen values increase by 1,223%. This is an extraordinary performance. To put this it into context, it took value stock Coco-Cola 24 years to deliver returns like this. 

Some fine wines are even demonstrating market-beating returns in extremely short timeframes too. Some brands like Hubert Lamy have enjoyed increases of over 450% in just three months. If you’d like to explore the greatest gains and losses in the industry, Wine Track is a useful resource. As you read, please remember that experts do not recommend investing for less than five years. 

Fine wine offers the best of both worlds 

Fine wine is a fascinating alternative investment because it seems to offer the best of both value and growth without the downfalls.  

Fine wine is a buy-and-hold asset which increases in intrinsic value over several decades, while offering historically-superior returns. It also holds up well in recessions and fights back against inflation. These are all classic characteristics of value investments. 

Meanwhile, some bottles have proven to be extremely lucrative over the short-term. These boosts in value are likely to continue as climate change ramps-up demand for scarce flavours. High gains in short periods of time – especially from alternative assets – are usually more commonly associated with growth investments. 

Therefore, fine wine is an incredibly versatile asset, suitable for different kinds of investment strategies. Whether you’re looking for value, growth or both, fine wine could help you reach your goals faster. 

Explore your investment options

 

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Bordeaux 2020 in Bottle

Bottles of Mouton Rothschild 2020

A number of key critics have delivered their thoughts on the third and final of the vintage triumvirate – Bordeaux 2020. The wines are characterized by lower alcohol levels, tension, and precision as a result of the warm and dry conditions with well-timed rainfall.

As the wines continue to become available in bottle, attentions have refocused on this vintage thanks to the unusual circumstances that surrounded it. With summer ripening and harvest taking place in the thick of the Covid-19 lockdown, restricted access to the estates meant that the growing season and processes took place relatively quietly and without the usual commentary. En primeur tastings were undertaken either remotely, or under tightly controlled conditions.

More recent tastings have revealed, however, that Bordeaux 2020 might be the champion of the three. Antonio Galloni concluded in his report, titled “Saving the Best for Last”, that “2020 is a great modern-day Bordeaux vintage. From the standpoint of both peaks and overall consistency, it surpasses 2018 and 2019.” Neal Martin notes in his report that “Overall, the 2020 vintage delivers the goods. It seals the trio of great Bordeaux vintages, albeit sculpted in a modern style” referencing that of the three vintages that encountered warmer conditions “by 2020, they knew a hell of a lot more than in 2018”.

Both praised Pauillac’s Lafite Rothschild and Mouton Rothschild, as well as the “epic” Château Margaux, powerful Montrose, and Pétrus, which Neal Martin proclaimed “an absolute killer”.

Jane Anson was fortunate enough to be one of a handful of people able to experience en primeur in Bordeaux itself. In her Bordeaux 2020 vintage overview she mentions the significance of a more focused year. Where producers could be fully dedicated to winemaking alone, this “allowed estates to put the spotlight on their own processes, and perhaps question certain accepted practices, or double-down on others.”

Anson also notes that Bordeaux 2020 has seen only limited trading so far, but that it is likely to pick up the pace soon as more wines become available.

Bordeaux 2020 looks to be a vintage with a lot to offer, and potentially one of those rare occasions where the third in the series is considered the best. At WineCap, we see excellent performance potential here and will be in touch with new offers on this promising offering soon.

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United States | Regional Report

1976 was the turning point for California and US wine in general. ‘The Judgement of Paris’ blind tasting on May 24th proved that France had a serious contender when top Californian Bordeaux blends were tasted against Bordeaux classed growths, and Californian Chardonnays against white Burgundy. To the surprise of many, California led on both fronts.

This was the first step that set the region in motion. In the 1990s, the first Californian ‘cult wines’ emerged – big brands that attracted collector followings. Producers such as Inglenook, Stag’s Leap, and Robert Mondavi were the pioneers, but it was Screaming Eagle that established the formula for success that many followed: tiny volumes, word-of-mouth hype, and soaring prices. Robert Parker’s appraisal and perfect scores further bolstered their image.

The global market for US wines, dominated by California but also featuring wines from Washington and Oregon, has exploded in recent years. Its share of secondary market trade has risen from 0.1% in 2010 to around 7% this year, and an increasing number of previously overlooked wineries are now showing investment-worthy returns.

Our USA Report delves into the development of its investment market, historic performance, recent expansion and key players.

Discover more about:

  • History of the US wine industry
  • International and domestic trade
  • California’s most significant AVAs
  • Napa Valley’s investment-worthy wines

Do not hesitate to get in touch and speak to one of our wine investment advisors for further information and to reserve your allocations.