Liv-ex “The Fine Wine Market in 2021” - from Italy to Burgundy, everyone is growing

In 2021, the Liv-ex numbers and data on the fine wines market, month by month analyzed by WineNews, have helped to paint a picture of the secondary fine wine market, and confirmed, for all the trends that have emerged so far, in the report, “The Fine Wine Market in 2021”, edited by the most important trading platform dedicated to wine, based in London. This year, 2021, has been a year of recovery, but not yet a total return to normal pre-Covid-19. Therefore, it will go down in history as the year that saw every record fall, while the Liv-ex Fine Wine 100 surpassed the peak reached between 2010 and 2011, before the Chinese bubble burst, and the Liv-ex Fine Wine 1000 reached 18 consecutive months of growth. All of this on a market that is becoming bigger and bigger, in terms of the number of wines and the number of territories it involves. At the same time, investments from the United States have found new vitality, since the duties on French wines that Trump had imposed have been abolished, which has led (as the “Liv-ex Power 100 2021” clearly revealed) to a general rebalancing, following the success of Italian wine in 2020, from which Bordeaux and Burgundy especially have benefited. The result is that the market has grown in value +20% since the beginning of the year - a performance that is second only to that of crude oil, but much better than the FTSE 100 and Dow Jones.
The Liv-ex Fine Wine 1000, since its beginning, has grown +315.3%, while the Liv-ex 100 (the best performing index in the last two years, driven by the Bordeaux and Burgundy blue chips), and the Liv-ex 50 have registered, respectively, 309,2% and +339,2%.
Actually, all the sub-indices of the Liv-ex 1000 - the Bordeaux 500, the Rhone 100, the Italy 100, the Burgundy 150, the Champagne 50, the Rest of the World 60 and the Bordeaux Legends 40 - grew in 2021, thanks to the continuous expansion of the market. The weakest performance, and in any case in a positive context, is the Bordeaux 500, which has grown +9.2% since the beginning of the year, while the strongest development is Champagne 50, at +33.7%. Burgundy 150 is also noteworthy, which, driven by the many vintages of Domaine de la Romanée-Conti, Armand Rousseau and Domaine Leflaive exchanged, registered + 27.1%. Consequently, the share of Bordeaux is still falling, and in terms of percentage of the total values ​​traded, has dropped from 42% at the end of 2020 to 38.8% at the end of 2021. Burgundy, on the other hand, has reached its maximum ever. Its share is worth 21.4% of the market, against the previous record 19.7%, dating back to 2019. Rodano (4.5%) and the United States (7.6%) also registered a record year, as did Italy, which grew from 15.1% in 2020 to 15.3%, a small, but significant step forward. Despite a surprisingly positive trend in terms of prices (over + 50% for wines such as Comtes de Champagne 2006 and 2008 by Taittinger, Cristal Rosé 2008, Krug 2000 and Salon 2002), the share of Champagne fell (to 8.4%) in the USA, which for the first time, following impressive growth, + 219% in 2021, in terms of investments in French bubbles has outdone the United Kingdom.
As we mentioned, the base of wines traded on the Liv-ex is expanding, as producers reached 4.411.7.6% more than in 2020, and wines 11.452.10.5% more than in 2020, which is seven times the number of wines traded ten years ago. The Balearic Islands in Spain, Aconcagua in Chile, the Palatinate in Germany, Campania and Calabria in Italy, are among the many emerging territories that still have very small numbers, but they have the potential to grow quickly. Diversification, however, also applies within large territories, as demonstrated by the records of Burgundy producers and wines. Looking, instead, at the top performers in terms of price growth, at the top of the list we find Salon 2002 (+ 80.1%, from 5.500 Sterling pounds to 10.000 Sterling pounds per 12 - bottle case), then Chambertin Grand Cru 2012 by Domaine Armand Rousseau (+73.7 %), Bonnes Mares Grand Cru 2013 by Domaine Georges Roumier (+69.1%), Bâtard-Montrachet Grand Cru 2013 by Domaine Leflaive (+ 66.6%) and Hermitage 2008 by Jean Lous Chave (+66.3%). The prices of Domaine de la Romanée-Conti are continuing to rise as well, such as Grands Echézeaux and Richebourg reaching +50%. It is essentially the triumph of Burgundy, mainly due to scarce vintages in the vineyard, which contribute significantly to price increases.
Returning, on the other hand, to Bordeaux, it is interesting to note, for the first time in 10 years, the share of Premiers Grands Crus Classé has grown, which in 2010 were worth 60% of all Bordeaux sales, and in turn, at that time, represented 95.7% value of the market. Today, Premiers Grands Crus Classé represent 35.9% of the Bordeaux wine trade, share that had reached 32.6% in 2020, and in 2021 they experienced the best year since 2018. Especially Château Lafite Rothschild, the most traded brand on the secondary fine wine market, ahead of Petrus, Château Mouton Rothschild, Sassicaia (Tenuta San Guido), Château Margaux, Château Haut-Brion, Screaming Eagle (California), Château Pontet-Canet, Domaine de la Romanée-Conti and Château Latour. Considering individual wines, however, the first three positions went to Château Lafite Rothschild 2018, Sassicaia 2018 and Château Lafite Rothschild 2017.
Finally, 2021 is closing an exceptional year for the secondary market of fine wines, which is proving more and more to be a winning investment, thanks to constant returns, low price volatility, and less availability of stocks from the most important regions. The sentiment, even for 2022, is positive, especially by virtue of constant growth, but at a much slower pace than in the 2010/2011 two-year period, while being fully aware that, in any case, no market can grow forever.