Recent industry news reported on the latest Californian ‘Cult Cab’—a new limited edition Cabernet Sauvignon from Napa that will be released in magnum format at $3,500 a bottle. Announcements like this are not unusual when it comes to California. This revered New World region has long been able to command high prices for cult wines.
As discussed in last month’s Market Report, California’s top wines represent the highest entry point into the fine wine market from the New World, and the region is positioned behind only Burgundy (red) and Bordeaux’s Right Bank overall. In the past year, prices of the last five vintages of Screaming Eagle, Opus One, Dominus, Harlan and Ridge Monte Bello have risen 25% on average. Californian wines made a notable entrance in the Liv-ex Classification 2019, with Scarecrow, Colgin IX, Harlan and Screaming Eagle all firmly placed in the 1st tier. Considering Harlan’s average trade price of £8,139 per 12x75, we commented that its founder’s ambition to create “something like a ‘First Growth of California’” has been fulfilled.
Last year, we introduced the California 50 index, which closely follows the price performances of the last 10 physical vintages of the most traded Californian wines: Harlan, Dominus, Opus One, Screaming Eagle and Ridge Monte Bello. Over the past five years, the index has outperformed both the industry benchmark Liv-ex 100 (+32.5%) and the broadest measure of the market, the Liv-ex 1000 (47.3%) by rising a whopping 76.1%.
Within California, the Screaming Eagle index has been the biggest riser, posting gains of 89.2% since July 2014. Dominus has followed closely, up 65.3%; Opus One is up 57% and Harlan is up 55.5% after a boost this summer. The Ridge Monte Bello index has been the slowest riser, but has still increased 38.3% over the past five years.
When it comes to trading activity, the 2013 vintage of Promontory, by the Harlan family, has been the most active from the U.S. by value so far in 2019. Robert Parker awarded it 99 points and said it was “nearly perfect,” “a stunner and again, accessible, but its best days are probably a good decade away, as this could very well turn out to be a 40- to 50-year wine.” Meanwhile, Opus One 2015, which was released last year, has led U.S. trade by volume, and comes second by value. Lisa Perrotti-Brown, MW, who gave it 97+ points, described it as “truly an iron fist in a velvet glove.” Opus One has turned into one of the most anticipated and highly successful La Place releases each year.
When it comes to the most active Californian vintages, recent years have proven the most popular: 2015, 2013, 2014 and 2016 have led trade by value this year. This comes as no surprise as vintages pre-2010 have become very hard to find. The wines trading have also been quite varied, and not limited to California’s most famous. The market for Californian wines has broadened considerably over the past five years: the number of distinctive wines trading has risen fourfold, doubling in the last two. While U.K. and Europe continue to be its main buyers and sellers, Asia and the U.S. have demonstrated considerable interest over the past two years.
Broadening trade and steadily rising prices point to a bright future for Californian wines on the market. Some commentators have begun to voice concerns that prices might be climbing to unsustainable levels—but the ‘shock of the new’ suggests demand (in Europe at least) will remain robust.
Readers should take note that the views of this author represent those of a company with an interest in the wine trade. Liv-ex operates the global marketplace for the wine trade. They have over 440 members from start-ups to established merchants and supply them with the data, trading and logistics services they need to price, source and sell wine more efficiently. Private collectors can view Liv-ex prices and value their portfolios using Cellar Watch and find regular market analysis on the blog. The opinions of Liv-ex are their own and do not represent those of Robert Parker Wine Advocate or Wine Journal. Liv-ex contributes articles to Wine Journal that we feel are of market relevance to readers, but we do not specifically endorse this company.