How many bubbles are there in a standard bottle of champagne? In fact, there are none. Until one pours out its golden contents, champagne’s signature globules of gas cannot form.
But there are no concerns about a bubble in the market for premium vintage champagne. After two plus years of glum trading, some excellent fizz from France can be bought at a relative bargain.
For many years regarding it as a forgotten cousin of Burgundy and Bordeaux, homebound collectors during the Covid years piled surplus capital into the best of bubbly, and prices roughly doubled.
When the speculative demand finally dissipated, leaving the fine wine market with too much inventory, prices subsequently sank. According to Liv-ex, the fine wine exchange, its Champagne 50 index has fallen by more than one-third after peaking in December 2022.
However, finally those with a nose for value have begun shopping. “Vintage champagne has been picking up since the summer,” according to Sophia Gilmour, a market analyst at Liv-ex. “We have seen increased volumes in trading.” These have doubled since June.
She believes the turning point for champagne followed the US tariff increases in April for imported wines as keen collectors, especially from Europe, sought out top marques.
Gilmour cites renewed interested in vintage Salon and Selosse Millesime, two of the pricier champagnes in the Liv-ex index. “To risk this level of capital — rather than opting for more affordable wines — also indicates improved confidence in future price performance and demand.” A six bottle case of Jacques Selosse Millesime 2002 trades at around £10,000, before any duties or taxes.
Vintage champagne benefits from structural factors. First, while many of the most famous still wines from Burgundy and Bordeaux, especially the reds, may need extra ageing in the bottle, vintage champagne can be ready to drink at release. Younger customers, for fine wines generally, have less patience than those of earlier generations.
This trend has appeared at auction sales as well. Nick Pegna, Sotheby’s head of wine, has noted that vintage champagnes Dom Pérignon and Krug unusually appeared among its top 10 sellers last year. He has seen more interest from younger bidders. “It’s a more accessible category. You don’t need to think about food pairing.” No vintage will be terrible, he observes.
Champagne tends to be consumed in multiple bottles, even cases, at celebrations such as weddings. This wears down supply more quickly. In Hong Kong, a resurgent stock market — the Hang Seng index is up 30 per cent year to date — has led to a lot more gifting of champagne to clients by the financial community, according to wine merchant Altaya.
In general, the top marques have always enjoyed steady attention from collectors. “Fabled wines such as Salon, Krug, Dom Pérignon and [Louis Roederer] Cristal from vintages such as 1996, 2002, 2004 and 2008, with good provenance, are always in demand,” says Miles Davis, a consultant at Vinum Fine Wines.
“At a lower price point among the elite [producers], Taittinger’s Comtes de Champagne remains very popular and incredibly good value for the quality it delivers.” Yours at £620 a six-pack, before duties and taxes.
But opinions are mixed on how the admittedly modest improvement in the market will progress next year. The Champagne 50 index has recovered only 14 per cent after many months of declines.
“Yes, the champagne 50 index has stabilised since May,” says Peter Mitchell, head of wine at merchants Jeroboams. He agrees that some rarer champagnes, such as those from Selosse, have bounced in price but isn’t convinced there will be any follow through. “My feeling is that, going forward, we won’t see spectacular growth . . . it doesn’t feel like a bull market, but there are buyers.”
There is another factor to consider, says Nick Baker, founder of The Finest Bubble in London. The quality of vintages available during the pandemic buying binge were exceptional, particularly 2008, 2012 and 2013. “So we got a bit spoiled by great vintages and now the recent ones [from 2015 onward] aren’t as good,” he says. That will have given buyers another reason to hold back on purchases.
As such, he professes cautious optimism. “We mustn’t talk up the market too much. It’s not romping away.”
Where Baker does see more potential is in the less common bottle formats. He thinks magnums — equivalent to two regular bottles — are worth their premium prices given their scarcity value. These also offer longer ageing potential as less of the wine can come into contact with oxygen. Magnums account for less than 10 per cent of production.
Gilmour at Liv-ex remains bullish. One healthy signal is that the value of bids against offers on the exchange has climbed to 0.5 times, meaning the amount demanded is half that of supply. “That’s the threshold we’ve identified [for premium champagnes] that predicts positive future price movements over the coming months.”
