The global fine wine market has been falling for three straight years, deepening investors' disappointment. The Trump administration's tariff policy has cooled U.S. buyers, and investment funds have shifted to other assets such as stocks and gold, weighing on the market overall. The latest sell-off has pushed fine wine prices back to late-2020 levels.
On the 25th, the Financial Times (FT) of the United Kingdom reported, citing wine exchange Liv-ex, that the Fine Wine 100 index, a key gauge of price trends in the fine wine market, fell 2.8% through the end of November this year. By region, prices of Bordeaux wines in France dropped 6.6%, Burgundy fell 4.4%, and vintage Champagne declined 4.3%. Justin Gibbs, Liv-ex vice chairman and exchange director, said, "This bear market has been much tougher than the previous downturn."
The decline is seen as a process of the bubble formed during the COVID-19 pandemic deflating. During COVID-19, low interest rates, ample liquidity, and spare cash drove fine wine prices to a record high, but assessments now say almost all of those gains have vanished. During the same period, the surge in U.S. tech stocks and gold drew investors' attention, which worked against the wine market.
U.S. tariff policy also dealt a direct blow. President Trump imposed a 15% tariff on imports from the European Union (EU), sharply reducing U.S. demand for fine wine. According to Liv-ex, purchases of fine wine by U.S. buyers fell about 44% this year. With demand weakening in the United States, one of the largest consumer markets, pressure increased across the global market.
Weakness in Bordeaux's "en primeur" market, where wine is bought before bottling, also deepened the slide. Producers set prices for new releases excessively high, leading to inventory buildup, and prices then repeatedly fell on the secondary market. As buyers recognized that wholesalers and retailers still hold substantial inventories, they delayed purchases, and transactions shrank.
Bordeaux's 2021 vintage in particular posted weak results. The 2021 vintage of the well-known fine wine Château Mouton Rothschild fell 5.2% this year, and Château Haut-Brion dropped 11.4%. The 2021 vintage of Château Ausone in Saint-Émilion plunged 34%. Critics called the vintage solid but not outstanding.
Still, signs of a rebound have emerged recently. Through the end of November, fine wine prices edged up over the past three months. Traders in Hong Kong and Singapore said Asian demand, subdued by China's economic slowdown, is gradually returning. Paulo Pong, founder of Hong Kong's Altaya Wines, said more clients are looking to take advantage of undervalued prices.
Singapore-based Vinum Wines, a leading Asian fine wine distribution and investment firm, said, "Demand for Burgundy white wines and vintage Champagne is increasing." There were also assessments that interest from Chinese clients is rising again. Gregory Swartberg of wine investment firm Cru Wine said, "Although the market has been weak recently, it has also been a chance to buy quality wines cheaply." He noted, "Because of the small 2024 vintage, a shortage of white wines is expected," adding, "We focused on buying 2023 Burgundy."