Fine Wine Investment
Author: Berry Bros. & Rudd
That the best wines have proved to be sound investments over the past few years is undeniable: one only need to look at the numbers to see that the fine wine market has been exceptionally buoyant since 2005 (the year, not the vintage) and customers who own top end 1996 & 2000 clarets will have done very well indeed. Prices for the best 2005’s have also moved upward and we look forward to their physical arrival in the UK in the Spring, which should coincide with Robert Parker’s report of the wines in bottle.
The recent turmoil in the financial markets has had relatively little effect on the fine wine market. The lack of any significant crossover or correlation between the financial and fine wine markets has been well documented, and to me it’s quite simple: fine wine is a tangible asset, it is a luxury product that we aspire to own, consume and know more about. It’s much more useful than gold, and easier to enjoy than art.
Moreover, the supply of any particular vintage of, say, Margaux, is constantly diminishing and, in the case of younger vintages, is constantly improving. Is a case of 2005 Chateau Margaux worth it?
Yes, every penny and more.
Interest and demand for fine wine is growing. The price rises that we have seen for the very best, driven largely by the super-wealthy and the “new” markets of the Far East, etc, are the ones that have grabbed the headlines but it is important to note that these are not the only wines that are selling. I see no sign of this demand falling and the number of potential new wine lovers, drinkers, buyers and connoisseurs in this increasingly wealthy and sophisticated world is unbounded.
We will shortly be launching our own measure of the fine wine market – The BBR 100. This of course will be no measure of the quality, the class, the sheer beauty of the wines that will be included, but it will make for an unbiased and unemotional gauge of the market’s ups and downs.
Will the price rises that we have seen over the past two years continue?