Market watch

Trad­ing plat­form says long-term ‘steady growth’ in sales of top Cal­i­for­nian wines points to col­lec­tors’ grow­ing aware­ness of New World op­por­tu­ni­ties

Decanter - - CONTENTS -

A NEW IN­DEX chart­ing prices for cult Cal­i­for­nia wines has yielded more ev­i­dence of the Golden State’s grow­ing im­por­tance in the sec­ondary market.

Liv-ex has launched a Cal­i­for­nia 50 in­dex to track the last 10 phys­i­cal vin­tages of the five most-traded Cal­i­for­nian wines on its plat­form: Scream­ing Ea­gle, Opus One, Domi­nus, Har­lan Es­tate and Ridge Monte Bello.

If it had been run­ning since 2003, the in­dex would have tripled in value in 15 years, Liv-ex said, close to match­ing growth for the Liv-ex 100 and Bordeaux 500 in­dices over the same time pe­riod.

Cal­i­for­nia still only ac­counted for 3.7% of Liv-ex trades by value in the year to the end of July 2018. But its rise has also been felt else­where in the trade.

BI Wines & Spir­its said re­cently that col­lec­tors had bet­ter knowl­edge of Cal­i­for­nia’s bou­tique pro­duc­ers and were ‘more open to try­ing “New World” wines’.

Michael Davis, vice chair­man at Hart Davis Hart auc­tion house in Chicago, told De­can­ter at the time of go­ing to press that more than 60% of its Cal­i­for­nia lots have sold above their high es­ti­mate in 2018 so far, ver­sus 50% through­out 2017.

‘We’ve seen higher ham­mer prices, but for a se­lec­tive group of la­bels,’ Davis said, adding

that de­mand also de­pends upon lo­ca­tion. ‘Asian bid­ders are now such a pow­er­ful force in our auc­tions, and they are far more fo­cused on Euro­pean wines.’

HDH’s top Cal­i­for­nia sell­ers at auc­tion in 2018 have so far been Scream­ing Ea­gle (just over $1m in to­tal re­alised sales), Har­lan Es­tate ($386,000) and Sine Qua Non ($191,000).

Is there a Cal­i­for­nia price bub­ble? ‘The Cal­i­for­nia 50 in­dex has risen steadily over the past decade, which sug­gests that this is not the case,’ said Liv-ex re­search an­a­lyst Ed­ward Jack­son. ‘How­ever, we are not in the busi­ness of pre­dict­ing this.’

Above: a chart shows how Liv-ex’s new Cal­i­for­nia 50 in­dex would have risen in value since 2003

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