Bordeaux Index, the world’s largest fine-wine dealer, is toasting surging gross sales as buyers flock to uncommon vintages partially as a hedge towards rampant inflation.
Revenues on the advantageous wine service provider reached £80mn within the six months to June 30, up 37 per cent on the identical interval final 12 months. That places the London-headquartered firm on the right track to beat 2021’s file income of £126mn.
The service provider’s on-line wine buying and selling change, LiveTrade, was accountable for almost all of progress, reporting gross sales 53 per cent larger than the comparable interval final 12 months.
More than 600 vintages are traded on the platform, various in value from Tuscany’s Tignanello 2019, round £650 for a six-bottle case, to £13,000 for a dozen bottles of Champagne’s Salon Le Mesnil 2012 and as a lot as £54,000 for a 12-bottle case of Bordeaux-produced Château Pétrus 2018.
“Interest in wine and whisky as asset classes has never been higher,” stated Gary Boom, Bordeaux Index’s founder. People are scrambling for investments that can outpace inflation, which is nearing 10 per cent throughout western nations. Earlier this week, the Bank of England predicted the UK inflation fee would attain 13 per cent by the tip of the 12 months.
Matthew O’Connell, chief government of LiveTrade, added: “People still drink this stuff, but they are increasingly noticing the value of wine as a hard asset that has a proven track record of inflation resistance.”
Last 12 months, advantageous wines have been the top-performing “passion investment”, in accordance with the Knight Frank Luxury Investment Index, delivering a mean return of 16 per cent, larger than artwork and cash.
“The supply is finite, the wine keeps getting better over time and there are more luxury consumers than ever who are looking to buy,” stated O’Connell.
Bordeaux Index’s LiveTrade platform processes round 50,000 transactions a 12 months. Its consumer base elevated by round a 3rd final 12 months to the tens of 1000’s, the corporate stated, declining to offer a precise determine.
In May this 12 months, Société Jacques Bollinger, the family-owned French group behind Bollinger Champagne, elevated its minority stake in Bordeaux Index. City veteran and Conservative peer Michael Spencer, who Boom used to work for at broking big ICAP, holds a 20 per cent stake within the firm and serves as chair.
Greater curiosity from retail buyers and the resilience of luxurious items throughout client downturns put the uncommon wine market in “a healthy place” over the subsequent few years, added O’Connell, who confused that it was “not a bubble”.
However others within the trade are much less bullish concerning the outlook for the uncommon wine market. “There will be lots of high net worth individuals buying wine as a hedge against inflation, but there may be more people in the mid-wealth category who are less buoyant because of the cost of living crisis and are pulling back,” stated Miles Davis from Wine Owners, which runs a database monitoring the worth of advantageous wines.
Last month, a magnum of Champagne Avenue Foch 2017, together with a non-fungible token together with the mental property rights for the art work on its label, was offered to 2 Italian buyers for a file $2.5mn.
The FT revealed final month {that a} cask of uncommon Scotch whisky from the Ardbeg distillery was offered to non-public collector in Asia for £16mn, smashing the earlier world file of £1mn which was set just a few months earlier.
“The net effect may be that . . . the wine market is stable and unexciting for the next few years,” added Davis. “The wine market does need the feel-good factor. It’s only a happy place to invest when things are going well and for a lot of people things aren’t going well.”
