WineFi Weekly

Welcome to the eighth edition of WineFi Weekly👋
📅 May 13th 2024

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New Podcast Episode

On this episode of the Wine Investing Podcast, we welcome Erik Portanger of the Wine Management SICAV.

Erik and Callum talk all things wine investing, how to build a resilient portfolio, and how investors can outperform the market.

Available wherever you get your podcasts. Click here to listen on Spotify.

WineSyndicate

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Bordeaux Royalty

Over half of the Bordeaux Royalty collection (which saw a 6% increase in April) is now sold out. This is a great opportunity for those who are looking for exposure to wine as an asset class at a lower price point whilst still seeing the benefits of diversification.

There are still some “Splints” available, so if you would like to be able to gain exposure to wine as an asset from €50 then use the link below to sign up.

Use code WINEFI50 for a €50 bonus when signing up

En Primeur 2023 analysis

It is the year of significant price drops, but there are a few things that we think investors should consider before taking these price drops at face value. Firstly, the truth is that on the whole, the wines this year are not as good as last year. To explain why this is we can look at Dr Axel Marchal’s 5 pre-conditions of a great vintage.

1. Quick and even flowering and fruit set
2. Weather conditions in the late spring and early summer sufficiently dry and warm to facilitate even pollination and to provide the pre-conditions for even ripening
3. A gradual rise in hydric stress over the summer (with, above all, a warm and dry July), slowing and ultimately stopping vine growth before véraison (colour change)
4. Ripe grapes with optimum photosynthesis continuing up until harvest (without any significant resumption in vegetative growth)
5. Dry and medium-warm weather during the harvest itself (ideally, with good temperature variation between night and day), allowing picking at optimal ripeness (and freshness).

In 2021 none of these conditions manifested, but they all emerged in 2022 and it was a great vintage.

In 2023, most conditions were present, but not all. Generally, conditions 1, 4, and 5 were fulfilled; condition 2 was mostly satisfied, albeit with a few exceptions; however, condition 3 fell short.

To buy or not to buy (that is the question):

Château Lafite Rothschild 2023

We regard this wine as a buy.

The 2023 Lafite was released at £4,920 per 12x75 - a 31.7% decrease compared to last year.

Wine Advocate have stated that the 2023 Lafite is the finest of the first growths released this year.

Similar pricing to the 2019 vintage which is now trading above its release price and received similar critic scores.

The 2020 vintage which also received 98/100 from Neal Martin is trading 13.7% down on its release price, but is still priced higher than the 2023 release. This suggests a narrowing gap between release price and value on the secondary market.

Château Léoville-Las Cases 2023

We think there is probably better value to be found in the back vintages.

Released at £1,662 per 12x75 - a 40% decrease compared to last year and received a score of 95-97 from Neal Martin.

Leoville Las Cases is falling in terms of trade volume on the secondary market

A better deal would be the 2019 or 2015. They both received a score of 97 from Neal Martin and are now trading at a discount to the 2023 release price, alongside the benefit of having time-in-bottle so they will reach peak drinking age sooner.

Château Lafleur 2023

We regard this as a buy (if you can get an allocation at release price).

One of the few 2023 wines that could be better than the 2022 release. It has been released at a similar price point.

There is little trading activity so far on the 2022, but the small number of trades taken place have been firmly above the release price.

Lafleur was ranked as the 9th best wine of the vintage by Liv-ex members, but William Kelley (The Wine Advocate) sees potential perfection in the wine, scoring it 98-100 points. The critic comments that ‘the 2023 Lafleur is one of a small number of contenders for the title of wine of the vintage’.

_{Source: Liv-ex}