Grape Britain

Once considered little more than an interesting hobby, English wine is now a fully fledged business and highly investible according to Barnaby Dracup.

The English wine industry has now emerged from the shadows of the past two decades and has firmly established itself as a world leader in a class of its own, evolving from beyond the the parochial curiosity it perhaps once was.

One such English wine estate leading the way is Gusbourne in Appledore, Kent. In 2013 Gusbourne was admitted to the AIM market of the London Stock Exchange, with the distinction of being the first UK wine producer ever quoted on AIM.

Charlie Holland, Gusbourne’s winemaker, has a firm belief that despite the ‘new kid on the block’ perception of English wine, it’s the sense of English heritage that attracts buyers: “English wine is now a world-beating industry and already has a substantial history behind it. Gusbourne Estate dates back to 1410 and has been agricultural land for centuries, with our first vines being planted in early 2000.

“There has definitely been a big change in the attitude towards English wine by consumers and the general perception of it now is that it is really good, people actively look for it and are more than happy to drink it.

“Our first wine was released in 2010 to critical acclaim and since then we have gone on, as have a lot of the English wine industry, to win numerous awards and accolades. Gusbourne has been proved to stand with some of the best wines in the world in blind tastings and is definitely recognised by the wine trade as being a world-beater in terms of quality.

“We are now exporting to 16 different countries worldwide,” adds Charlie. “There is huge value attached to Britishness and our largest markets include places like the US, Japan and Scandinavia – English wine is associated with prestige, heritage and quality.”

And it is the heritage of English wine which some may find surprising, with an embryonic industry being present on this fair isle as long as almost 30 years ago. Sam Lindo is winemaker at Cornwall’s family owned Camel Valley, and has also experienced similar changes and the increase in recognition.

“Our first vines were planted back in 1989 by my father and we first made still wine here in 1992, on a small scale. However, it turned out my dad was actually quite good at it and so production and plantings were increased,” says Sam. “When it comes to the rise of English wine, there’s more potential to come, as the public are beginning to see English bottlings on wine lists everywhere and are realising that it’s really, really good. The rest of the world is definitely catching on too and that is obviously affecting sales.

“I joined the business in 2001 and we now have a much bigger focus on sparkling wine instead of still. This seems to have paid off as we’ve won ‘best sparkling rosé in the world’ four times – proving that English wines now have some real clout.”

Lucy Shaw, managing editor, The Drinks Business, agrees that in particular sparkling wines are something we Brits do well: “Once considered little more than an eccentric hobby, English sparkling wine is now big business. Our best homegrown sparklers can stand shoulder to shoulder with Grandes Marques Champagnes and are even beating their French counterparts at blind tastings. Local sparklers have even got the government seal of approval – Ridgeview in Sussex and Chapel Down in Kent are the official fizz suppliers for 10 Downing Street. The fast growing English wine industry is now worth over £132 million, and the bigger players are enjoying success in export markets such as the US and Japan.”

It is this worldwide success that is leading to a fledgling investment industry for winemakers in the UK, with most companies offering direct investment opportunities and some being floated on the stock market.

Neil Taylor is head of data at Liv-ex, a global marketplace for professional buyers and sellers of fine wine, and partner in the Reynolds Estate Wine Hampshire and has direct knowledge of the wine market. “Liv-ex is a trading exchange for professional members – merchants, negociants, investment funds and brokers,” says Neil. “It was established in 2000 and the members have traditionally focused on the markets of Bordeaux, Burgundy, Italy and Champagne, but in recent years the brands traded through the exchange have increased quite dramatically and those brands now include some English wine – Kent’s Chapel Down and West Sussex’ Nyetimber.

“Our feeling is, that looking at the capital and financing that has been raised for the various English wineries, it all points to the fact there is a good outlook for the English market, in terms of both domestic consumption and international demand. So, with my Liv-ex hat on, all the indicators suggest there is a good future for English wine, and I believe that to the extent that I’ve invested in a vineyard myself.”

Charlie Holland of Gusbourne also believes the signs for the future are bright and point to a maturing of the industry as a whole: “Gusbourne is one of two companies that are on the London Stock Exchange and I think it’s a sign of the coming of age of the industry that we have these businesses now listed. Of course, it’s a long-term investment and not a quick buck, but it is certainly stable in terms of investing.

“In terms of the wine itself, that’s an interesting point because the one thing we have in England is a lovely acidity in our wine, which comes from the slightly longer growing season. This lends a vibrancy and freshness and gives some excellent flavours – retaining a lovely backbone structure to the wine – and it’s this structure that’s excellent for ageing. Our first vintage was from 2006 and I tasted our Blanc De Blanc 2006 recently and it’s in fabulous condition. So, that’s a wine that’s 12 years old and still has ageing potential – so a good investment for the future.”

Lucy Shaw agrees with this structural analysis of English wines: “Parts of southern England share the same chalky soils as the Champagne region, which is why we’re able to produce outstanding sparkling wines. However, rather than trying to ape Champagne, English fizz has its own identity, characterised by racy acidity, which gives the wines a compelling vibrancy and freshness.”

It’s these unique qualities of English wine which also play a large part in its charm, quality and success, as Sam Lindo explains: “The thing that’s interesting with wine making is, due to regional variation, everyone makes a product that can’t be made anywhere else in the world. The very fact we can only sell our wine at a certain price, due to its relative scarcity, means English wines will always be a premium product at a premium price. This means that for potential buyers and investors, they are looking at a product which will always be of a premium quality and therefore value.

“When it comes to investing in wine itself, with English wine you also have to consider the appreciation of land values,” continues Sam. “If that comes with an investment it should always be a pretty solid bet. A lot of the shrewder investors are investing in businesses that own the land and offer that as part of the package – so even if the business is not as successful as one hoped, there is still the land value to fall back on.”

With scarcity of space, increasing land values and growing demand already creating pressures on the English wine industry, there are still yet more considerations growers and makers must take into account when looking to the future.

“Another practical consideration is that long term climate change is going to particularly favour southern England; in ten years time our climate’s not going to be far off that of Burgundy,” says Neil. “Along with Taittinger, Vranken-Pommery Monopole have begun investment in the UK – but have not yet announced any vineyard purchases. They’re collaborating with Hattingley Valley wines at the moment to source premium grapes. The industry here is really starting to attract some top talent, too, in terms of winemakers and experts, which again is another good sign for the future.”

Lucy Shaw agrees that the attention and commitment coming from industry heavyweights, such as Taittinger, is another stamp of approval for the future of the English wine industry: “English sparkling wine’s biggest endorsement so far came in 2015, when revered Champagne house Taittinger announced that it had bought a 69-hectare plot in Kent for the production of top-end English fizz.

“While English wine has a way to go before it is considered a serious investment opportunity for fine wine collectors, Nyetimber’s listing on the Liv-ex fine wine trading platform was a marker in the sand moment. Another milestone was the release of Chapel Down’s single vineyard sparkler – Kit’s Coty Coeur de Cuvée 2013 – last April at £99.99 a bottle, proving that the top expressions can command serious cash.

“With Brexit forcing up the price of imported wines, the appeal of homegrown wines will only strengthen and, as an avid wine-drinking nation, it’s wonderful to have wines of our own to be proud of.”