This website uses cookies so that we can provide you with the best user experience possible. Cookie information is stored in your browser and performs functions such as recognising you when you return to our website and helping our team to understand which sections of the website you find most interesting and useful.
News
Logistics and global economy top concerns of fine wine merchants
Logistics and supply-chain issues and the down-turn in the global economy are the top concerns among traders of fine wine, an annual survey of Liv-ex members has found – although many remained “cautiously optimistic” despite the challenges.
The survey, which took place in November, canvassed Liv-ex’s 625 members in 44 countries ranging from start-ups to very well established historic merchants.
It found that more than 54% of respondents believe the global economy will remain the market’s biggest challenge in 2023, with just under a third (30%) arguing that a global economic downturn and regional recessions was likely to impact the market and 20% concerned about currency volatility.
Logistic and supply chain issues are the second most cited macro-challenge, mentioned by 16% of respondents. Additional paperwork due to planned UK duty changes and labelling was mentioned by some, while others referenced the ongoing disruption to Chinese imports.
However, there was also some cautious optimism to be found – with merchants reporting increasing demand for Burgundy, Bordeaux, California, Piedmont, and Champagne.
Burgundy was the region cited as in most demand by 41.8% of respondents, not helped by its low yields and restrained releases, followed by Champagne (40%), which provided “substantial investment growth”, driven by high demand for vintage champagne and decreasing supply.
This was ahead of Bordeaux, which was indicated that it was the most in-demand region by 9% of those surveyed, ahead of Tuscany (3.6%), California (3.6%), and whisky (1.8%).
In terms of increased demand, 9% said Champagne had seen more sales, along with 5% citing Californian. Meanwhile customers appeared to be were spending more on average but merchants explained that this was due to greater focus on quality rather than greater volumes.
Looking forward, around 14% of respondents expect some sort of price correction on Burgundy wines, as the current prices are not sustainable in the long term. In terms of Bordeaux, the outlook is mixed, with 7% forecasting a resurgence and greater demand for the region, while an equal amounts of respondents argue that Bordeaux will and will not have a successful 2022 En Primeur campaign.
Meanwhile, 60% of those surveyed expected the Liv-ex Fine Wine 100 Index – the top 100 wines on the market – to rise in 2023, with some estimating a rise of around 45%, although the most pessimistic cohort predicted a drop of 28%.
CEO James Miles said the snapshot represented “the best possible barometer of market sentiment” and he was delighted that their outlook appears cautiously optimistic, despite the challenges faced by everyone.
Related news
UK Christmas lights could buy 14 million mulled wines