After falling for most of the first half of 2019, fine-wine prices rallied in June (fig.1). The Bordeaux first growths that make up the Liv-ex 50 closely mirrored the wider Liv-ex 100 benchmark index over the period. The more eclectic Liv-ex 1000—comprising wines beyond Bordeaux and lower down the ranks— fell more steeply in the first quarter of the year, losing 3 percent, but then picked up sooner, rising three months in a row from March.
The two main drivers of the sharper drop seen by the broader fine-wine market in the first quarter were older Bordeaux and Burgundy, losing around 6 percent apiece to March (fig.2). While the former then rallied over the following three months, Burgundy was flat over the second quarter, its downward plunge stalled but no reversal of the trend yet apparent.
Italy was the most stable region over the first six months of 2019, and with just a 2 percent rise it saw the greatest gains of any category in what has been a slow start to the year for fine-wine prices. The Rhône and Champagne followed, remaining in positive territory—just— for the first six months of the year. The broader-based Bordeaux 500 index was essentially flat (fig.2).
When it comes to trade share on the Liv-ex platform, Bordeaux’s freefall since 2010—losing 4 percent share on average each year—was stemmed in the first half of 2019, when the region dropped just 1 percent share. It now accounts for 58 percent of trade on the platform, down from 96 percent in 2010 (fig.3). As previously pointed out in these pages, this phenomenon is undoubtedly at least partly due to the Liv-ex platform broadening its range and may therefore exaggerate what is nonetheless an incontrovertible wider market shift.
Conversely to the downward movement of Burgundy’s prices, the region continues to gain market share, adding 3 percent on 2018, bringing it to 18 percent so far in 2019 (compared to only 1 percent in 2010). Champagne, Italy, and the Rhône all maintained their 2018 market shares: 9, 8, and 3 percent Respectively.
For the full article, please see WFW 65 2019 Q3