Wine investment: The fine wine market in 2024
The successful sale of two 19th century wines at auction can't conceal the struggles of the fine wine secondary market in 2024.
Rare 19th-century Château Latour and Burgundy have lit up the auction scene in Hong Kong in recent weeks, with Château La Mission Haut-Brion starring in London.
A Christie’s auction of wines sourced from estates owned by Artémis Domaines – controlled by French billionaire François Pinault – saw a bottle of Château Latour 1865 sell for HK$812,500 (£80,500), including buyer’s premium. That outpaced a pre-sale high estimate of HK$220,000.
From Burgundy, a bottle of Chambertin 1865 from Bouchard Père & Fils sold for HK$625,000 (high estimate: HK$300,000), and a bottle of the domaine’s Montrachet 1864 fetched HK$437,500 (high estimate: HK$150,000). Another major ex-cellar auction, hosted by Sotheby’s in London and featuring La Mission Haut-Brion wines, saw large-format bottles from famous 1980s vintages take centre stage.
A five-litre jeroboam of La Mission Haut-Brion 1989 sold for £13,750, including buyer’s premium (high e: £8,500), while a jeroboam of the 1982 vintage realised £12,500 (high e: £6,500).
Held to mark 40 years since Domaine Clarence Dillon acquired the estate, the 7 November sale also featured a number of older wines. A bottle of La Mission Haut-Brion 1929, one of the wines featured in the Decanter Wine Legend series, sold for £6,875 (high e: £3,200).
Duty cuts could boost Hong Kong’s trading hub status
A Hong Kong government decision to significantly cut duty tax on premium spirits (from 100% to 10% on spirits [above 30% abv] with an import price of more than HK$200 per litre) could benefit the territory’s position as a trading hub for fine whiskies.
Adam Bilbey, global head of wine and spirits at auction house Christie’s, said: ‘I feel this will encourage Hong Kong- based collectors to purchase more globally and help Hong Kong become one of the global destinations for fine spirits.’
At Sotheby’s, global head of wine and spirits Nick Pegna said: ‘The reduction in spirits duty will certainly provide some benefits to buyers of rare spirits in Hong Kong, but is probably not the seismic shift in the global market that the zeroing of wine duty [in Hong Kong] was in 2008.’
Fine wine market review for 2024
Muted trading and a downward drift in prices have been key themes on the fine wine market in 2024, although there are exceptions, particularly among older vintages.
There has been relatively low selling and buying activity in fine wine in 2024, according to Matthew O’Connell, CEO of the LiveTrade online trading platform at international merchant Bordeaux Index.
Bordeaux Index fine wine indices for Bordeaux, Burgundy, Champagne and Tuscany show that prices have drifted lower during the 10 months to 30 October (see chart).
Some wines have bucked the trend. The top five price risers in 2024 year-to-date, according to Bordeaux Index data, were: Cos d’Estournel 2000 (+12%), Cheval Blanc 1990 (+11%), Solaia 2015 (+10%), Solaia 2013 (+7%) and Léoville Las Cases 1990 (+7%).
Nick Pegna, the global head of wine and spirits at auction house Sotheby’s, said: ‘The fine wine market in 2024 has been a buyer’s market, but one where if wines have met three key criteria, they sold well. These criteria are: impeccable provenance, rarity and maturity. Thus, immature wines in plentiful supply struggled.’
He added: ‘From a buyer’s perspective, there have been some great bargains, as well as some record prices.’
Liv-ex, a global marketplace for the trade, said in November: ‘While the market is undoubtedly bearish, prices are, in some cases, falling to levels that are low enough to attract buyers.’
It reported several Bordeaux wines trading in higher volumes, but that were also last traded below their ‘ex-London’ en primeur release prices. These included Châteaux Figeac, Léoville Las Cases, Pichon Baron, Palmer and Troplong Mondot from the highly rated 2019 vintage.
O’Connell said fine wine prices had ‘probably drifted about as much as they’re going to’, but added: ‘I don’t think it’s a case of prices needing to be cheaper for people to partake.’
He said a fundamental issue was the present relative lack of enthusiasm for buying fine wine, and luxury goods in general. He linked this to certain macroeconomic factors – including elevated interest rates – that have affected discretionary spending.
However, O’Connell observed that some categories are generating more interest. Rare Burgundy, as well as semi-mature Bordeaux and Champagne, may offer opportunities at current prices for any buyers wishing to get involved, he said.
The Bordeaux Index view
As we come to the end of 2024, the fine wine market continues to see very muted enthusiasm from buyers, something which appears to us to be not specific to the wine market but rather luxury goods and discretionary spending more generally.
Prices have drifted across the year but not at all dramatically, something which supports our view that the dynamic with market activity is one of demand rather than price sensitivity.
The outlook appears to be improving and there is increasing trading in rarer wines such as top Burgundies, where price declines look overdone. The timing of a full resumption of activity is less clear though, potentially linked to various macro factors.
Fine wine & spirits specialist Bordeaux Index kindly sponsors this section of Decanter, and provides its view on the market here every issue. It can be found at bordeauxindex.com.
Disclaimer: Decanter’s Marketwatch pages are published for informational purposes only and do not constitute investment advice. Wine prices may vary and they can go down as well as up. Seek independent advice where necessary and be aware that wine investment is unregulated in several markets, including the UK.
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