We often use the saying ‘ageing like fine wine’ to imply things that get better with the years. As a general principle, fine wines do appreciate in value as they age. However, wine valuation is also impacted by several market factors – economic situation, socio-political context, consumer trends, demand and supply dynamics, market investment, and so on.
The good news is, experts predict a positive outlook for the wine industry in 2023. The market outlook is buoyed by the overall strength and resilience of the fine wine segment, the growing demand for fine wines, improving standards and innovations in winemaking, as well as increasing consumer interest, awareness, and investment in the market.
But if you have investment wines in your collection, how do you figure out whether to sell, hold, or consume? First, watch out for the growth markets and then look at their top-performing wines!
Wines from France
The historic dominance of France over the fine wine industry will continue through 2023.
Burgundy – Micro-production will keep prices and valuation high of premium Burgundy wines. With the average price of these wines in 2022 ranging between £1,461 and £3,257 and average growth in the range of 22 – 28%, Burgundy labels that are expected to go up in value include Faiveley, Bouchard Pere & Fils, Trapet Pere & Fils, and Jacques Prieur. Of particular note is Arnoux Lachaux, which clocked an average price higher than £10,000 in 2022 with an average growth of 487%, followed by Domaine Leroy with an average price of £6,7000 and average growth of nearly 60%. Note that Burgundy’s Domaine de la Romanée Conti label is arguably the #1 investment wine today.
However, you do not need to pay a five or six-figure amount to be able to invest in Burgundy. For example, newer vintages such as the 2021(being released in 2023) can be picked up without breaking the bank and promises higher returns.
Bordeaux – These wines promise increasingly good value in comparison, and rank high on brand prestige, market liquidity, and longevity. While First Growths like Chateau Mouton and Lafite Rothschild remain dominant brands, the Right Bank wines are the ones to watch out for their increasing value in 2023. Wines like Chateau Figeac, Chateau Petrus, Chateau d’Yquem, Chateau Lafleur and Le Pin registered average prices across the wide range of £1,684 to £33,600 and average growth between 18 – 24%. If you’re looking to invest, start at the lower end and watch out for the release of the 2022 vintage.
Champagne – Champagne has been a crowd favourite for years now. Although an easier access point into wine investment than a Burgundy or Bordeaux, the category is experiencing soaring prices and strong growth average of 18-19%. Dom Perignon, Louis Roederer, and Krug are top-of-the-chain labels with their average price in the £2,300 to £3,600 range and 35-40% growth. Although prices dipped in the last quarter of 2022, this year is expected to experience lower supply levels and upward valuation in the long term.
Rhone – There is positive interest in upcoming regions like Rhone Valley as well. With increasing Champagne prices, this is now the lowest entry point into wine investment, while offering high quality and stable market value. Rhone wines are also the least impacted of French wines by the market proclivity towards Burgundy and Champagne. Labels like Jean Louis Chave, M. Chapoutier, and E Guigal are experiencing value growth in the 12 – 40% range with average price in 2022 having been in the range of £1,300 to £3,500.
Wines from Italy
Italy, with upcoming regions like Piedmont and traditional favourites like Tuscany, follows next in the list of wine regions with top potential in 2023. Italian wine has proved to be a robust asset time and again during periods of crisis, whether it be the Global Financial Crisis of 2008 or the US-China trade war and Hong Kong recession of 2019-20. While the region lost some ground to Burgundy and Champagne in 2022, this year can prove to be compelling as buyers will look to diversify their portfolios and Italy will be an obvious choice.
Sassicaia remains the top-ranked Italian investment brand by wine value and volume, but the labels to watch out for their rising value this year are Quintarelli Giuseppe, Tignanello, Masseto (esp. vintages 2010, 2013 and 2015), Giuseppe Rinaldi, and San Guido. In 2022 these wines averaged in price between £1,077 and £6,600 and registered average growth of 18 – 32%.
Wines from the United States
The other key wine region that promises an increase in wine value this year is California / United States, with Napa Vallery prestige labels leading from the front. Although California lost trade share last year, partly due to currency factors (the Sterling strengthened in the last quarter and rendered US purchases pricier), individual wines like Screaming Eagle and Harlan Estate delivered strong performances. Watch out for these in 2023, along with Scarecrow and Hundred Acre, for growth between 19-29% and prices in the range of £5,000 and £25,000.
Macroeconomic factors that shaped the markets in 2022 will remain in force in 2023. This means that the most powerful investment wines of 2022 are expected to remain on the top investment list this year as well. To better understand wine valuation, you can do your own research online or you can cut through the noise and speak to an expert directly.
