Investing in Champagne: No sign of slowing

Champagne prices have been rising fast on the fine wine market as buyers seek to pick up vintages of the top names. Buyer demand has continued to be led by the highly regarded 2008 and 2012 vintages – topped up by recent releases such as Krug 2008 or Salon 2012 – yet also by other vintages of the top labels.

Momentum was good going into 2021 but the global reopening of hospitality sectors may have helped to boost Champagne further, said Matthew O’Connell, head of investment at Bordeaux Index and CEO of the merchant’s LiveTrade platform.

A LiveTrade index based on executed trades of Louis Roederer Cristal, Krug and Dom Pérignon, across all vintages, rose by 26% in the 12 months to 30 September, said O’Connell.

Krug outperformed the other two, with the 2004 and 2002 vintages showing particular gains. However, beyond this triumvirate of labels, Taittinger Comtes de Champagne narrowly outperformed Krug over the same 12-month period, O’Connell said.

Liv-ex recently highlighted Champagne price rises during the month of November, led by Krug 2004, Pol Roger Sir Winston Churchill 2008, Dom Pérignon 2008 and Cristal 2009.

Liv-ex co-founder Justin Gibbs said that, alongside exciting vintages, one ‘can’t discount the relative value argument’ among the reasons for buyers’ interest. Prices for Krug, Cristal or Dom Pérignon can still compare favourably to top-tier wines from Bordeaux and Burgundy, as well as other regions, he said.

Liv-ex said in November that the five most-traded Champagnes by value on its global marketplace year-to-date were: Cristal Rosé 2012 (£3,480, 12x75cl in bond), Dom Pérignon 2008 (£1,980), Bollinger Grande Année 2012 (£880), Dom Pérignon 2010 (£1,453), and Taittinger Comtes de Champagne 2008 (£1,940).

Meanwhile, vaunted grower Champagne house Jacques Selosse entered the Liv-ex Power 100 ranking in 2021, in 36th place. And Gibbs said 303 different Champagne labels had traded on Liv-ex in 2021 so far, versus 84 back in 2016. Will Hargrove, head of fine wine at Corney & Barrow, said he believed more customers ‘see Champagne as part of the fine wine landscape than they did before’. He said there was more curiosity about stylistic differences – rather than sticking to one brand, ‘people shop around a bit more’.

From an investment perspective, Bordeaux Index previously questioned whether Champagne has become a more attractive medium-term prospect, but said it was too soon to know. Champagne has traditionally been seen as a solid, ‘lower risk, lower return’ market segment, with prices rising steadily over time as supplies diminish.

One recent example of a Champagne rising in price immediately after launch is Krug 2008, which Gibbs said ‘has just gone straight out of the gate and up’. O’Connell noted that there were limited supplies of Krug 2008 in the market. Cristal 2013 – rated 96pts for Decanter by Simon Field MW – has also risen in price since its release in 2021, showed Liv-ex figures.

Given the dynamic nature of the market in recent years, it will be particularly interesting to see how Champagne’s trajectory develops during 2022. UK-based merchant Goedhuis & Co said in its Q3 [third quarter] 2021 market report: ‘With the forthcoming squeeze on future Champagne vintages due to climatic conditions – 2013, for instance, is only being made by a handful of houses – in our view vintage Champagne remains very much a firm buy.’

Investing in Champagne: the latest sales activity

Top cuvées surge ahead

Christie’s auctioned a single bottle of Perrier-Jouët ‘Brut Millésimé’ from the ‘outstanding’ 1874 vintage, in a rare sale in London, early December, of wines sourced from the Champagne house’s Oenothèque.

The 1874 vintage, which came with a VIP experience at Maison Perrier-Jouët in Epernay, sold for £42,875 (US$56,981/€50,292), versus a pre-sale high estimate of £15,000.

More recent vintages also found demand. Three magnums of Perrier-Jouët Belle Epoque 1979 sold for £8,575 (pre-sale high e: £3,000), three magnums of Belle Epoque 1988 fetched £4,900 (high e: £2,400), three magnums of Belle Epoque 1989 sold for £4,288 (high e: £2,400) and one jeroboam of Belle Epoque 2000 sold for £2,083 (high e: £1,200).

There was more evidence of market momentum for Champagne’s highly regarded 2002 vintage, with 12 bottles of Belle Epoque Blanc de Blancs 2002 fetching £4,288 (high e: £3,000).

Tim Triptree MW, international director of Christie’s wine and spirits department, told Decanter before the sale: ‘Demand for prestige cuvée Champagne in 2021 has been high, with impressive prices achieved at Christie’s auctions worldwide.’ He said collectors were ‘competing for the top vintages from the grandes marques’.

Tasted and rated for Decanter Premium

Salon, Cuvée S Le Mesnil Blanc de Blancs, Champagne 2012

This latest-release Salon vintage was rated 99pts by expert Yohan Castaing. ‘The Salon 2012 has scintillating aromatic brilliance and purity with seductive scents of white fruit, citrus zest and spring flowers capped by a touch of spice,’ he wrote for Decanter Premium, describing the wine as ‘a racy thoroughbred that will go the distance without effort’. Salon’s exclusive UK agent Corney & Barrow launched three-bottle cases of 2012 for £1,450 in bond. Will Hargrove, Corney’s head of fine wine, said the merchant planned to release magnums next year. The previous Salon vintage, 2008, was only released in magnum format.

The Bordeaux Index view

Fine wine & spirits specialist Bordeaux Index kindly sponsors this section of Decanter, and provides its view on the market here. It can be found at bordeauxindex.com

Champagne has probably been the most interesting segment of the fine wine market in 2021. Given the suspension of the US trade tariffs (which had been a tailwind to prices), it did have the potential to be a quieter trading year, but in fact we have seen a substantial step-change in prices.

Activity in Champagne on our LiveTrade fine wine trading platform has risen more than 50% and market prices by more than 25%, beyond the already strong +15% price gains of the broader wine market. There has been some variation across names, with Krug the biggest riser at above 40%, and Cristal registering less than 20%, but a significant part of this is due to different release cycles and other factors (such as Krug building up to the 2008 vintage while Cristal is on 2012/2013).

Given that the main drivers have been the global reopening and increased high net worth consumption and investment, both ongoing trends, it is fair to assume that Champagne will also have a strong 2022, perhaps remaining ahead of the broader market.

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