One of the biggest developments in the fine wine market over the last decade is the shift of focus from Bordeaux to now including an ever-growing list of wine-producing regions from around the world.

There was a point, not too long ago, when around 90% of all trades executed within the wine investment market were for wines produced in Bordeaux.  Today that figure lingers somewhere around 38%, proof that the market has undergone some big changes over the years.  The regions that have expanded their market share to take up the remaining percentage is long but could be summarised, in size order, as follows – Burgundy, Italy, Champagne, USA, Rhone and interest in these regions has grown exponentially.


Italy had been something of a sleeping giant but the progress of Italian wine in the market has been explosive, something that we predicted several years ago.  Clients that put faith in our early Italian recommendations have seen impressive levels of growth, many have even traded their initial holdings to take up positions with younger vintages or alternative brands.  Italy is a region that continues to grow and with a wide selection of wines available at varying price points, the opportunity to tap into this sector of the market remains for almost any budget.

There are other external factors that have helped to boost Italian wine’s performance. Italian wines were excluded from the recent USTR tariffs, and unlike Bordeaux and Burgundy, there is no complicated En Primeur system to navigate or unnecessary classification issues to be argued over.  All of these combined in 2020 to propel Italian wines upward and moving into 2021 the trajectory has continued.  In the first quarter of this year wine trade by value was up 125% on 2020 and the number of buyers seeking Italian fine wines had grown by 45%.

 

Performance has been very reliable in recent years and acquiring a parcel of Italian wine or vintage Champagne now could give you good reason to raise a glass and celebrate in years to come.

 

The most-traded Italian sub-region is still Barolo, followed in order of popularity by Tuscany, Brunello di Montalcino, Bolgheri and Barbaresco. However, this is also followed by a further 40 sub-regions that are currently traded on the secondary market, nearly double the number in 2020.

However, The Champagne 50 Index has grown by 12.7% in the past year, outperforming Italy and many traditional mainstream investments products.  Even though Champagne has had an excellent run of late there remains huge scope for growth. Champagne offers some of the most affordable wines on the market, especially when compared to the premium wines of Burgundy or Bordeaux.


The performance of specific Champagne brands and vintages often far exceeds that of the index.  A great example is the 2002 vintage of Salon ‘Le Mesnil-sur-Oger’ which was available five years ago for £2,790 per case.  Today cases are trading for around £6,900 which represents a 147% growth over five years and a £4,110 return.  This figure generates a Compound Annual Growth Rate of 19.85%.


Performance has been very reliable in recent years and acquiring a parcel of Italian wine or vintage Champagne now could give you good reason to raise a glass and celebrate in years to come.