In June, the Liv-ex Fine Wine indices exhibited varied performance, reflecting broader trends and specific market movements within the fine wine sector.
The Liv-ex Fine Wine 100, the benchmark for the industry, fell by 0.4%, mirroring its 0.6% decline in May.
This consistent decline indicates a cautious market, possibly influenced by global economic uncertainties or shifts in collector behavior.
Liv-ex Fine Wine 1000 Index: A Broader Market View
The Liv-ex Fine Wine 1000, which encompasses 1,000 wines from across the globe, saw a more significant decline of 1.2%, closing at 388.28. This level was last observed in August 2021, highlighting a notable dip in the market's broader segments. The index's decline suggests that the global fine wine market is experiencing pressures that are impacting a wide array of wines, not just the top-tier selections.
Among the Liv-ex Fine Wine 1000's sub-indices, the Bordeaux Legends 40 emerged as the best performer, recording a 0.3% increase. This rise contrasts with the sharper declines seen in the Burgundy 150 and Champagne 50, which fell by 2.4% and 2.6%, respectively, a significant increase in their downward trajectory compared to May's 0.5% and 0.2% drops.
Liv-ex Fine Wine 50: The First Growths' Performance
The Liv-ex Fine Wine 50, tracking the daily movements of the Bordeaux First Growths, fell by 1.5% in June, a sharper decline than the previous month. This index's performance underscores the volatility even among the most prestigious wines, influenced by factors such as market liquidity, investor sentiment, and external economic conditions.
Market Activity and Trends
June also witnessed a reduction in the number of brands (LWIN7s) and individual wines (LWIN11s) traded on the secondary market compared to May. Both traded value and volume saw slight decreases. Despite this monthly dip, the first half of 2024 shows an overall increase in trade volume and the number of transactions compared to the first half of 2023, indicating a generally positive trend in fine wine trading activity over the longer term.
Liv-ex Fine Wine 100: Detailed Insights
The Liv-ex Fine Wine 100 has experienced a consistent decline over the past three months, with a year-to-date drop of 3.4%. However, the index remains up by 12.6% over a five-year period, reflecting its long-term value appreciation. Within this index, Promontory 2018 stood out with a 15.9% increase, suggesting strong demand for this cult classic. Conversely, Harlan 2018 was the worst performer, falling by 9.8%. Interestingly, Promontory 2018 last traded at £8,280 per 12×75, 17.9% below its original release price, indicating that collectors are capitalizing on current market prices.
Bordeaux Legends 40: A Closer Look
The Bordeaux Legends 40, which tracks the performance of 40 Bordeaux wines from exceptional older vintages (from 1989), recorded a 0.3% rise in June, its first positive movement in a year. Among the 40 wines in this index, 14 saw price increases, 23 saw declines, and 3 remained flat. Petrus, Pomerol, 2000 was the top performer, up by 14.7%, trading at GBP 38,160 (EUR 45,079) per 12×75. Other notable performers from the 2000 vintage included Château Angelus, Château Mouton Rothschild, Château Cheval Blanc, Le Pin, and Château Latour, all showing significant gains.
Understanding Liv-ex Indices
The Liv-ex Fine Wine 100 Index is the leading benchmark in the industry, representing the price movements of 100 highly sought-after fine wines from key wine-producing regions such as France, Italy, the USA, Australia, and Spain. This index, with a history spanning over 20 years, is widely quoted on Bloomberg and Reuters.
The Liv-ex Fine Wine 1000 Index offers the broadest measure of the market, tracking 1,000 fine wines and comprising seven sub-indices: the Bordeaux 500, Bordeaux Legends 40, Burgundy 150, Champagne 50, Rhône 100, Italy 100, and Rest of the World 60. This extensive coverage provides a comprehensive view of the global fine wine market.
Conclusion
June's performance in the Liv-ex Fine Wine indices highlights the dynamic and complex nature of the fine wine market. While certain segments such as the Bordeaux Legends 40 showed resilience, broader indices like the Liv-ex Fine Wine 1000 experienced more significant declines. Understanding these movements and the factors driving them is crucial for collectors and investors aiming to navigate the fine wine market effectively.