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News
February proves promising for fine wine investors
February was another month of strong price gains on the fine wine market and further growth is predicted for the year ahead.
It has been the eleventh month of price increases on the Liv-ex 100 and Claret Chip indices, despite fears of a slow down.
February was a slightly better month than January, with both indices recording rises of 3.0% and 3.6% respectively during the month up on 2.7% and 3.0%.
These results have meant returns of 20.9% for Liv-ex 100 and 25.4% for Claret Chip. Even taking into account a slight dip in March 2009 the returns still remain strong on 19.5% and 23.9%.
Auction results were higher than expectations during February, with Sotheby’s in London selling 97% of its lots and achieving high prices on larger bottles. Christie’s in New York sold 98% of its lots and had twice the expected number of bidders.
The 1996 and 2004 vintages of Château Latour were the best performers during February, with prices rising by 10%. Château Lafite also saw the price of most of its vintages rise by 6-8%.
Mouton-Rothschild, Cheval-Blanc and Pétrus saw lower levels of price appreciation, however.
As a result of the positive market indicators The Wine Investment Fund has revised its forecast for 2010.
They are now predicting a 20% price growth for the year instead of the original 18%.
Asian demand remains strong and there has been no let-up since the Chinese New Year as was predicted and March, so far, looks set to be another good month.
Europe and North America’s economic outlook is mixed and perhaps an indication that these traditional markets for fine wine are lacking in confidence.
Andrew della Casa, director of TWIF said: “The amount of stock being sold appears to have fallen noticeably. This has pushed up prices and spreads have tightened to around 11% (bid-offer), compared to a typical 13-14%, in the second half of 2009.”
Rupert Millar, 11.03.10