Is the Fine Wine Bubble Bursting?

The fine wine market faces an uncertain outlook for 2025, marked by imbalances between supply and demand. According to data from Liv-ex, the wine trading platform, key indices show difficulties, reflected in the falling ratio of bids to offers, a key indicator of industry trends. Historically, a decrease in this ratio has signaled a downward trend, while an increase suggests a possible recovery. In the first months of 2024, the ratio reached lows, although it showed a slight recovery by year-end. However, it remains below the 0.5 threshold, considered the price stability point.

Since December, the Fine Wine 50, 100 and 1000 indices, as well as the Bordeaux 500, have seen a decrease in their bids-to-offers ratios. Most sub-indices have also been affected. However, the Italy 100 has shown resilience, with an increase in its ratio to 0.65, the highest level in the past year. The Burgundy 150 had a slight increase but remains at 0.18, while the rest of the indices remain below 0.50.

Within the Italy 100, Masseto leads with the highest bids-to-offers ratio, rising from 1.05 in August to 1.71 currently. Seven of its ten vintages have increased in price in the past year, while only 20 wines within this index have registered increases, of which six belong to Masseto. Ornellaia has also shown positive evolution, with a ratio that went from 0.45 in November to 0.83 in December, and which remains stable at 0.79. If demand remains strong, its prices could consolidate.

The Sauternes 50 presents the lowest ratio, at 0.05, reflecting lower demand for sweet wines. Even Château d'Yquem, the most recognized of the category, has a ratio of just 0.10. The Rest of the World 60 index is also at low levels, with 0.16, despite some wines within this category maintaining stable demand. In this group, Vega Sicilia Único and Opus One register ratios of 0.59 and 0.47, respectively, while Screaming Eagle Oakville Cabernet Sauvignon, Seña and Dominus show very low levels, at 0.04, 0.05 and 0.06. Penfolds Grange remains slightly above, at 0.10.

The Fine Wine 50, Second Wine 50 and Bordeaux Legends 40 indices have experienced significant declines in the past year, with decreases greater than 0.43 points in their ratios. This suggests that even the best vintages of Bordeaux are struggling with supply and demand issues. With more than 20,000 cases produced annually and stock owners reluctant to sell below cost, offer prices have not fallen enough to incentivize greater demand.