Fine wine markets declined in April by 0.37%, as measured by the performance of the Cult Wines Global Index.
Fine Wine Market Snapshot
The early weakness is likely a result of ongoing price consolidation in Burgundy and Champagne. While these regions led the market in recent years, the persistent rally has caused heightened price sensitivity among buyers in 2023, often leading to a short-term slump, Cult Wines said.
The upcoming Bordeaux 2022 En Primeur (EP) campaign may have also played a role in April’s slowdown. With expectations of stronger demand than in previous years, driven by a high-quality vintage and Bordeaux’s enhanced relative value, buyers may have opted to stay on the sidelines in April, waiting for the new releases set to begin in the second week of May. This anticipation could signal a “calm before the storm” in terms of demand in the fine wine market.
Macro Market Snapshot
In April, positive economic data from the U.S., eurozone, and the UK eased recession concerns and boosted equity markets. Falling energy prices led to lower inflation in major economies, causing the US dollar to weaken against global currencies. As global growth improved, the safe-haven greenback weakened while the British pound gained strength due to anticipated Bank of England rate hikes outpacing those of the US Fed.
Regional wine performance detail: Burgundy and Champagne Indices Dip, while US and Bordeaux Show Resilience
The Cult Wines Burgundy Index fell by 0.78% in April. However, this slight setback is only a minor dent in its longer-term performance which stands at 11.83% over the past 12 months, comfortably the top performing region.
Similarly, the Cult Wines Champagne Index declined by 0.69% in April, ranking last among regional indices YTD, but maintaining a healthy 12-month growth of 9.00%. Notably, Taittinger Comtes de Champagne Blanc de Blancs 2006 saw a 12.3% decrease, while its 2006 Rosé counterpart rose by 11.5%, indicating fluctuating demand as buyers seek value. Egly-Ouriet’s 2005 Brut Millesime Grand Cru, a prominent Grower Champagne, soared by 36.0% in April.
Defying the trend, the Cult Wines USA Index showcased robust performance in April. The U.S. market’s unique demand dynamics often lead to distinct behavior compared to traditional old-world regions. The 2009 Verite, Le Desir, surged by 38.6% according to Wine-Searcher pricing.
Maintaining its stable reputation, the Cult Wines Bordeaux Index saw a modest 0.18% decline. The sluggish market may be attributed to buyers awaiting the 2022 En Primeur releases. The largest drops occurred in Chateau Rieussec Sauternes (2015, 2017), while Chateau Figeac 2008 and Chateau Margaux’s Pavillon Rouge 2007, both highly anticipated during EP, rose by 19.0% and 18.3%, respectively.
Top Wines Defy Market Slowdown: Artadi Pagos Viejos Leads Performance League Table as Other Varietials Show Resilience
Artadi Pagos Viejos remains the top performing wine so far this year, despite a slight YTD dip in April. Crafted from old vines in three of Artadi’s top vineyards, Pagos Viejos is a long-lasting wine that continues to offer excellent value even after its recent ascent.
Remirez de Ganuza Reserva, another exceptional Rioja, leapt from seventh to fifth place.
Guidalberto maintained its second-place standing, with the Tuscan Merlot-based wine from Tenuta San Guido gaining recognition as a serious, age-worthy contender rather than merely Sassicaia’s second label.
Billecart-Salmon, Vintage and Laurent Perrier, Brut Millesime traded spots in third and fourth, both experiencing slight YTD reductions during April’s slowdown. Cedric Bouchard’s Roses de Jeanne Les Ursules Blanc de Noirs made its debut on the list, highlighting the potential of Grower Champagne alongside the Grand Marques.
Other newcomers to the top 10 include Donnhoff’s Niederhauser Hermannshohle Riesling Spatlese, a leading German Riesling, and a Chardonnay from Hyde de Villaine. A collaboration between Burgundy’s de Villaine family and California’s Hyde family, Hyde de Villaine has been producing reds and whites in Los Carneros AVA, just south of Napa Valley, since 2000. Critic scores for their Chardonnays have steadily improved, reaching the mid-high 90s in recent vintages.
Despite Burgundy’s overall weaker performance in early 2023, Joseph Drouhin’s Charmes-Chambertin Grand Cru achieved remarkable gains, emphasizing the enduring allure of the region’s finest wines.
The Cult Wines Global Index can be viewed on CultX.com, a digital trading platform at CultX.com/indices.