Fine wine prices slide for third year in a row as tariffs and stocks sap demand
Fine Wine Prices Decline for Third Consecutive Year
For the third year in a row, fine wine prices have experienced a decline due to various factors including Trump-era tariffs, reduced US demand, and investors shifting towards other investment opportunities such as stocks and gold.
According to Liv-ex’s Fine Wine 100 index, wine prices have fallen by 2.8% this year up to the end of November. Bordeaux saw a decline of 6.6%, Burgundy 4.4%, and vintage Champagne 4.3% as reported by the Financial Times.
Recent Bordeaux releases, particularly the 2021 vintage, have not performed as well as expected, with critics deeming it “decent but unspectacular.” Prices for wines such as Château Mouton Rothschild 2021 and Château Haut Brion have fallen significantly this year.
Château Ausone’s 2021 vintage experienced a steep decline of 34% to $4,193.10, according to the Financial Times.
Justin Gibbs, deputy chair and exchange director at Liv-ex, described the current market conditions as “brutal,” with a general decline in prices across all segments.
The decline in fine wine prices has erased most of the gains made during the pandemic, bringing prices back to levels seen at the end of 2020. This drop has been attributed to the strong performance of the stock market and increased interest in alternative investments.
President Trump’s tariffs on imports have also had a significant impact on the fine wine market, with a 44% decrease in purchases by American buyers this year according to Liv-ex.
The futures market for Bordeaux wines has also been affected, with the spring “en primeur” campaigns failing to generate the usual excitement and demand. Producers are still grappling with an oversupply issue due to aggressive pricing in recent years.
Despite the overall decline, there are signs of a potential recovery in the market, with prices showing a slight uptick in the last three months. Merchants in Hong Kong and Singapore have reported increased interest from Asian buyers, particularly in response to the rebound of the Hong Kong stock exchange.
Paulo Pong, founder of Altaya Wines in Hong Kong, noted that there is a growing interest in fine wine due to the improved financial situation of professionals in the region.
