In a robust market, we look at which are the best wines for investment in 2021. Fine wine investment has delivered growth and ‘safe sanctuary’ during the Covid-19 pandemic so far, protecting wealth and providing stability and growth in a complicated global economic landscape with high levels of uncertainty and instability as countries grapple with caseloads and vaccine deployment. Equities are currently performing well, but a year ago it was a very different story. Using the rationale that fine wine will provide a bed-rock of value to weather potential further storms in financial markets – which investment wines should you be considering in 2021?
Fine wine’s solid performance in 2020 and exuberant first quarter of this year continues apace, with record levels of trade, in terms of volume and value, being recorded on Liv-ex in Q1. The fine wine exchange witnessed the highest number of unique wines traded in March 2021 since Liv-ex was established in 1999. This also translates to positive price performance with the Liv-ex 1000, the broadest market measure, recording 10.7% growth in the 12 months to 31st March 2021 and now stands at its highest level ever.
Key Factors Influencing the Wine Investment Market In 2021
- US Trade Tariff suspension – now extended to a 6-month period. The current levy suspension is seen as a potential window of opportunity but may also be a more permanent arrangement as Biden’s administration adopts a different approach to international relations.
- Continued broadening in the fine wine market with emerging trends and brands
- Resurging demand for blue-chip Burgundy and Bordeaux
- The Bordeaux 2020 En Primeurs campaign in Q2
- Key vintage releases from key producers of investment wines
- Brexit bureaucracy is yet to be fully understood and the trade continues to lobby the UK Government
- The Covid-19 pandemic and how global economies build back sustainable growth
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Which Are The Best Investment Wines In 2021?
Whether you are looking at investing in fine wine for the first time or to strengthen your portfolio, you will want to know which are the best wines for investment in 2021. Liv-ex’s Power 100 Report ranks the 100 most powerful fine wine brands each year, and the 2020 Report published this January offers a useful guide when considering wine investment in 2021.
Liv-ex Power 100 – top 10 fine wine brands 2020:
| Fine Wine Brand | Region | 2020 | 2019 | Av price growth in 12 months | No. of wines traded |
| Leroy | Burgundy | 1 | 3 | 8.68% | 55 |
| Leflaive | Burgundy | 2 | 41 | 5.99% | 81 |
| Gaja | Italy Piedmt. | 3 | 34 | 7.02% | 65 |
| Sassicaia | Italy Tuscan | 4 | 7 | 9.31% | 32 |
| Penfolds | Australia | 5 | 30 | 3.27% | 57 |
| Ornellaia | Italy Tuscan | 6 | 91 | 9.56% | 34 |
| M&C Dom Perignon | Champagne | 7 | 9 | 3.73% | 56 |
| Ch. Haut Brion | Bordeaux | 8 | 16 | 1.34% | 52 |
| Masseto | Italy Tuscan | 9 | 72 | 5.71% | 23 |
| Louis Roederer | Champagne | 10 | 5 | 2.21% | 37 |
Source: Liv-ex Power 100 Report, 2020 (published January 2021)
The broadening fine wine investment market reflects demand as investors seek to diversify fine wine collections to optimise growth as trends shift focus by region, vintage and brand. Critics’ scores and drinking windows are an important consideration ensuring a quality portfolio positioned for changes in supply and demand. Where previous years have seen the Power 100 dominated by the Bordeaux First Growths and more latterly Burgundy, 2020 witnessed the broadest Top 5 composition with a marked absence of Bordeaux.
Liv-ex Power 100 – top 5 wine brands over 5 years:
| Rank | 2016 | 2017 | 2018 | 2019 | 2020 |
| 1 | Lafite R. | Lafite R. | Leroy | Armand Rousseau | Leroy |
| 2 | Mouton R. | Margaux | Lafite R. | DRC | Leflaive |
| 3 | Margaux | Mouton R. | DRC | Leroy | Gaja |
| 4 | Haut Brion | DRC | Mouton R. | Krug | Sassicaia |
| 5 | Latour | Angelus | Margaux | Louis Roederer | Penfolds |
Source: Liv-ex.com, Liv-ex Power 100 Reports 2016 – 2020
Keen investors will look to see where value was derived and the top price performers in the 2020 ranking recorded growth approaching 30% in the period under review. A significant number of these brands have ridden the tailwinds of the success of the big brands in their region and benefited from the broadening market.
Liv-ex Top 10 Fine Wine Price Performers in 2020:
| Price perf. Rank | Brand | Region | Av market price growth (12 months) |
| 1 | Ca’ Nova | Piedmont – Italy | 28.09% |
| 2 | Dal Forno Romano | Veneto – Italy | 19.47% |
| 3 | Henri Giraud | Champagne | 18.29% |
| 4 | G.B. Burlotto | Piedmont – Italy | 15.81% |
| 5 | William Fevre | Burgundy | 15.07% |
| 6 | Solaia (Antinori) | Tuscany – Italy | 14.98% |
| 7 | Bonneau du Martray | Burgundy | 14.41% |
| 8 | Rene Engel | Burgundy | 13.12% |
| 9 | Conti Costanti | Tuscany – Italy | 12.98% |
| 10 | Arnoux-Lachaux | Burgundy | 12.82% |
Source: Liv-ex.com, Liv-ex Power 100 Report 2020
Q1 2021 has seen the demand for top Burgundy and Bordeaux return and in fact be turbo-charged, with the suspension of the US tariffs on the 5th March stimulating a return of US buyers. The week following the suspension announcement saw trade increase by 50% in value and 65% in volume on Liv-ex. This builds on the fact that liquidity on Liv-ex is largely driven by Bordeaux’s top brands.
Top five brands for value and volume traded on Liv-ex:
| Rank | BY VALUE: Fine Wine Brand | Region | BY VOLUME: Fine Wine Brand | Region |
| 1 | Lafite Rothschild | Bordeaux | Sassicaia | Italy – Tuscany |
| 2 | Mouton Rothschild | Bordeaux | Pontet-Canet | Bordeaux |
| 3 | DRC | Burgundy | Leoville Poyferre | Bordeaux |
| 4 | Margaux | Bordeaux | Lafite Rothschild | Bordeaux |
| 5 | Petrus | Bordeaux | M & C Dom Perignon | Champagne |
Source: Liv-ex.com, Liv-ex Power 100 Report 2020
Key 2018 releases from Italy and Napa, the Burgundy 2019 en primeur campaign, Bordeaux 2018 in-bottle scores and a rise in the Rhone have been drivers in Q1 this year. Chateau Latour released its 2013 vintage (at the same price as 2012) late March and Q2 trade focus will be largely dominated by the Bordeaux 2020 en primeurs. There is a lot for wine investors to consider in the market right now.
An investor firstly needs to be clear on their budget for fine wine investment in 2021 and with their goals in mind, such as target returns, desired term and their attitude to risk, review the top investment wines they can afford. Fine wines for investment are selected for their growth potential based on past performance, current market trend and anticipated returns over the medium to long term. Remember that fine wine investments deliver the best possible returns over the longer term.
For more information about the current market conditions read our latest Market Report and to get our view on which specific wines you should be looking at in 2021 call us on 0203 384 2262.