Will you invest in Bordeaux 2022 wine futures? It’s a complex mix this year of a critically acclaimed vintage made in a high inflation period with questions over supply?
Factors shaping investment in Bordeaux 2022 en primeurs
- Quality - critics rate 2022 as an outstanding vintage
- Inflation
- Release prices
- Supply – reduced production levels and smaller En Primeur allocations
- Current market trends
- Back vintage values
Investors have more to consider when making their investment decisions about this year’s campaign. Given the current environment, the macro-economic factors of inflation, monetary policy, political stability and growth (or lack of it) in the UK economy are all influencers.
Add to this the need to take the magnifying glass to each chateau’s 2022 wine to get into the micro-determinators of brand equity, quality score, supply released at en primeur and potential over-hang from wine retained for release when drinking windows are reached.
As Cheval Blanc and Angelus are the first major players to issue their 2022 wines on to the market, we look at the value of investing in this year’s En Primeurs.
Critics’ quality view of 2022
The challenges for wine makers in the hottest Bordeaux vintage on record were monumental, but they have done a phenomenal job. We were privileged to be hosted at private tastings recently and be some of the very first to sample these miraculous wines.
The most influential quality guides to the market are now publishing their critical scores of Bordeaux 2022 based on the ‘in-barrel’ tastings in April 2023. James Suckling, The Wine Advocate, Jancis Robinson and Lisa Perrotti-Brown, whose scores are just coming out at the time of writing.
Suckling has referred to it as ‘astonishing’ and Perrotti-Brown states that it is ‘a faith-affirming vintage for Bordeaux growers’. It is becoming apparent that this is an outstanding vintage and is being compared to the Prime 2016. We will publish more on the critics’ quality scores soon.
Inflation and release prices
The ‘elephant in the room’ is inflation and as allocations and prices are released, we will see to what extent that 2022 is an ‘inflation-loaded’ vintage at en primeur?
The physical challenges of producing investment wines in a year where drought, wildfires, hail and intense rain periods will have added cost and been a further factor for the chateaux when looking at pricing.
We will be appraising each wine to determine if high release prices are justifiable and that there is fair value for investors at this stage.
Bordeaux 2022 Supply
The volume of wine produced across Bordeaux in 2022 is 15% lower than the 10-year average. Some vineyards had to deal with catastrophic events and yield was certainly affected. The key investment wines are made by extremely wealthy estates that are better placed than most to deal with these challenges, but supply is still a factor.
For some, it has been a very good vintage for Merlot and this has influenced the production of some wines. For example, Chateau Cheval Blanc will not produce its second wine, Petit Cheval in 2022, as all the Merlot will be retained for the Grand Vin.
En Primeur supply is also changing in Bordeaux's great estates. There has been a growing trend over the last decade, of the chateaux reducing the amount of wine they release at this earliest stage. They are retaining more for sale when bottled and in their drinking windows for a premium.
Current market trend
The general trend in the fine wine market in 2023 is a period of correction from the super-charge the sector enjoyed during the most intense, early periods of the Covid era and Ukraine war. Champagne is leading this movement, but this trend is also offering an opportunity for buyers to enter the market at a lower price point. Active wine investors can also add to, and diversify, existing wine portfolios at a discount.
Bordeaux has remained relatively static during this period with increased trading in blue-chip First Growths in Q1. The prices of older Bordeaux vintages will also be a consideration for investors with the current 2022 En Primeurs campaign. How the Bordelais’ 2022 pricing strategy compares to similar quality back vintages may determine the level of demand in the secondary market.
Our view on investing in the 2022 En Primeurs
Collectors who routinely invest in en primeurs, because they love the engaging process, being able to prescribe format (bottle) sizes, and acquire wine that will be shipped direct from the chateaux cellars, are likely to buy 2022 En Primeurs.
Investors and those new to ‘wine futures’ may be a little more cautious given the current environment. We will be appraising each wine on an individual basis with a macro / micro approach to our assessment. Our minimum selection requirements of brand equity and quality is a ‘no-brainer’. But the economic big picture is a sizeable factor this year in pricing and there has to be enough value for the investor.
We will be publishing our view on the key 2022 investment wine releases throughout this campaign. Follow our blog, social channels and sign up to our Newsletter to get the detail ‘hot off the press’.
You can register your interest for 2022 allocations by clicking below. Alternatively speak to our expert team on 0203 384 2262.