Wine Market Investment Report February 2020
by CloMlr
2020-03-17
We live in extraordinary times and what we thought was the perfect storm for the wine market just became a lot more perfect! Since I last wrote, major asset classes have tumbled in value as fear and uncertainty grips the globe. Wine prices look like they have barely moved in comparison to equity indices and the like but the reality of achieved selling prices would tell a different story. This is the nature of illiquid markets.
We have all lived through market crashes before and experience tells us that the aftermath makes for a very good buying opportunity. Admittedly we haven’t had an economic downturn brought about by a pandemic before. We don’t know how long the pandemic will last and how deep the economic hit will be.
We haven’t seen panic in the wine markets, not yet at least, and it’s fair to say that it feels like Hong Kong is waking up a little, in an almost post hibernation sort of way. Comment from friends in Hong Kong gives the impression of calm and that the worst is over. Although social distancing is still in full force people are getting on with the rest of their lives. Given how inactive, wine-wise, that area has been since last July, it’s possible that inventory needs restocking. Political unrest has also been dampened by the virus, so maybe there’s some cause for some springtime optimism in the orient.
Sadly, events in Europe and the west are only likely to deteriorate before they improve. The UGC finally called off Bordeaux en primeur tastings last week. My personal view is that this is a fantastic opportunity to reorganise tastings later in the calendar, giving the infantile wines a chance to develop and settle. The volatility of the major markets should have settled by then as well, inspiring better judged pricing.
Keep well, don’t panic and for those with cash, there will be some lovely opportunities. The Warren Buffets of the wine world will be rubbing their hands in glee!
| Index | Value | MTD | YTD | 1 Year | 5 Year | 10 Year |
| WO Burgundy 80 Index | 747.18 | 1.42% | 2.26% | 6.44% | 142.30% | 238.96% |
| WO Bordeaux 750 Index | 355.72 | -2.99% | -2.55% | 5.97% | 68.01% | 99.65% |
| WO Piedmont 60 Index | 305.5 | -8.39% | -8.13% | -5.73% | 64.89% | 96.22% |
| WO Tuscany 80 Index | 332.03 | 1.75% | 3.42% | 12.73% | 71.79% | 91.86% |
| WO First Growth 75 Index | 252.65 | -6.02% | -6.87% | -7.45% | 36.40% | 46.43% |
| WO California 85 index | 676.29 | -4.38% | -1.36% | 2.15% | 94.66% | 286.76% |
| WO Champagne 60 Index | 478.07 | -0.04% | -0.50% | 3.85% | 60.56% | 146.20% |
| WO 150 Index | 300.54 | -3.60% | -3.45% | -2.42% | 54.98% | 79.82% |
Miles Davis, Wine Owners March 2020
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Tags:
fine wine, wine investment, wine market,
Value, track and trade fine wine
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