The premium wine market shrunk significantly in 2024 as falling Chinese demand and investor caution squeezed prices.
According to the Liv-ex Burgundy 150 index, the price of Burgundies fell by 14.4% and vintage champagnes by 9.8%.
Bordeaux wines fell 11.3%, while the market’s general index, the Fine Wine 100, fell 9.2%. Meanwhile, global stock indices rose by 20%, which provides an even sharper contrast to the situation of the wine market, reported the Financial Times.
The fall of the market was caused by several factors:
- higher interest rates reduced the attractiveness of non-yielding investments such as wine,
- while the demand for high-end wines dropped significantly due to the Chinese economic slowdown.
- Asian collectors, who have been in extraordinary demand in recent years, have now become more sellers, which further pushes prices down.
- Many of the wine merchants and investors also mention market overvaluation as the main reason for the current situation.
However, some investors see an opportunity in falling prices. Lower prices allow you to buy premium quality wines and champagnes at a more affordable price. For example, Cru Wine head Gregory Swartberg recommends high-end Champagnes such as Krug 1996 and Dom Pérignon 1996, as well as Bordeaux and Burgundian specialties for investment, which are now available at a fraction of their previous prices.
However, the future of the market remains uncertain, but the demand for premium wines is expected to stabilize in the long term, especially if the global economy and Chinese consumption pick up again.
The cover image is an illustration. Cover image source: Getty Images
Source: www.portfolio.hu
