'Brexit boom' as fine wine buyers seek lesser vintages

The fine wine market has enjoyed a ‘Brexit boom’ in the weeks following the UK vote to leave the European Union – and the so-called ‘lesser’ vintages are leading the charge.

In brief

Liv-ex 50 up 19% in first eight months of 2016
Lesser Bordeaux vintages lead growth
Liv-ex and BI report ‘Brexit boom‘ for fine wine trading
US and HK buyers dominate

Full story

Liv-ex’s Fine Wine 50 Index is up 19.3% so far in 2016.

It tracks the price movements of the 10 most recent physical vintages of the five first growth Bordeaux châteaux.

The index recorded its ninth highest monthly rise – 6.8% – following the UK’s Brexit vote.

As prevously reported on Decanter.com, a drop in the value of sterling created a flurry of interest from dollar buyers in Asia and the US.

The numbers

Analysis by Liv-ex shows that interest is strongest in the ‘off’ vintages within the Liv-ex 50.

Bordeaux 2013 up 32.7% | 2006 up 26% | 2004 up 25.5% | 2007 up 25.4% | 2008 up 24% | 2011 up 23.1% | 2012 up 23%

The three most lauded recent vintages – 2005, 2009 and 2010 – have registered smaller increases, up 10.4%, 13.7% and 17.4% respectively.

Of the 50 wines on the index, 49 have increased in value during 2016.

Latour 2005 is down 1.5%. Lafite Rothschild 2013 registered the biggest increase, up 44.3% to £3,680 per case.

Liv-ex pointed out that, if a tracker fund had invested in one case of each wine in the Fine Wine 50 at the end of December, and sold it at the end of August, it would have made a profit of £38,538.

Geraint Carter, of BI, told Decanter.com that the fine wine market was experiencing a broader recovery.

‘The encouraging thing about the current situation is that demand is not restricted to the usual suspects – not just Lafite, not just first growths – but covers a much broader set of wines,’ he said.

‘That said, Hong Kong and the other US dollar-denominated markets are certainly leading the way and their relative preference for the younger and cheaper vintages is clear.

‘We’re not talking a repeat of [the boom of] 2010/11, but they are definitely the current favourites.’