Why fine wine investors are still losing money in 2025

Bottles of European red wines from Spain's Rioja region, Italy's Tuscany, and France's Bordeaux and sparkling wine originated and produced in the Champagne wine region of France pictured in a cellar. (Courtesy: Reuters photo)

For investors who once treated fine wine as a reliable alternative asset, the past three years have been sobering. Prices across the high-end wine market are on course to fall for a third consecutive year, erasing much of the pandemic-era boom and leaving portfolios nursing losses that few anticipated when bottles were trading at record highs in 2022, the Financial Times reported.

According to Liv-ex, the London-based wine exchange, its Fine Wine 100 index is down 2.8 per cent so far this year. The declines are broad-based. Bordeaux prices have fallen 6.6 per cent, Burgundies are down 4.4 per cent, and vintage Champagnes have slipped 4.3 per cent. By late November, prices had effectively returned to where they stood at the end of 2020.

A market with no hiding place

In previous downturns, some regions or styles offered shelter. This time, investors have struggled to find any bright spots. Market participants describe the sell-off as unusually comprehensive, with even traditionally resilient labels caught in the slide.

The reversal has wiped out much of the speculative fervour that took hold during the pandemic, when lockdowns, cheap borrowing and surplus cash pushed fine wine prices sharply higher. As global markets reopened, enthusiasm shifted elsewhere. Technology stocks and gold surged, drawing capital away from collectibles that no longer looked like easy winners.

Tariffs and the missing American buyer

One of the biggest drags on the market has been the United States. President Donald Trump’s 15 per cent tariffs on EU imports have discouraged American buyers, who had been among the most important drivers of demand during the boom years. Liv-ex estimates that the value of fine wine purchases by US buyers is down roughly 44 per cent this year.

That pullback has been particularly painful for Bordeaux, where producers are already grappling with excess supply. The region’s en primeur system, which allows wines to be sold while still in barrel, has struggled as recent releases were priced too aggressively. Many of those wines later traded lower on the secondary market, leaving buyers wary and merchants sitting on unsold stock.

When prestige doesn’t protect prices

Some of the sharpest falls have come in well-known names. Bordeaux’s 2021 vintage, seen by critics as solid but unremarkable, has performed poorly. Château Mouton Rothschild’s 2021 has slipped more than 5 per cent this year, while Château Haut-Brion has fallen over 11 per cent. Château Ausone’s 2021 has fared worse still, down more than 30 per cent.

For investors, these declines have challenged the idea that top labels are immune to market cycles. Prestige alone has not been enough to support prices when demand has weakened and confidence has ebbed.

Signs of life in Asia

Despite the gloom, there are early hints that the market’s long winter may not last forever. Prices edged higher in the three months to the end of November, and merchants in Asia report tentative improvements in demand.

In Hong Kong and Singapore, dealers say some buyers are taking advantage of depressed prices, helped in part by a rebound in local stock markets that has restored a measure of discretionary spending. Demand has been strongest for top Burgundies and vintage Champagne, categories where scarcity still resonates with collectors.

There are also signs of renewed interest from mainland China, where the wine scene is described by merchants as smaller but more sophisticated than in previous cycles. Appetite for Burgundy in particular is said to be growing, even as overall volumes remain below past peaks.

Opportunity amid disappointment

For some investors, the downturn is beginning to look less like a warning and more like an opening. After three difficult years, valuations have reset, and selective buyers argue that high-quality wines can now be picked up at prices that would have seemed unthinkable during the boom.

Attention is already turning to future vintages, especially in Burgundy, where supply constraints could support prices down the line. The poor, low-yielding 2024 harvest has raised expectations that scarcity may again play in investors’ favour.

Waiting for confidence to return

For now, fine wine remains out of step with the broader investment landscape. While equities and gold have delivered strong returns, wine has lagged, testing the patience of those who bought near the top of the market.

Whether the worst is over will depend on a mix of factors: easing trade barriers, more realistic pricing from producers, and a sustained recovery in global demand. Until then, investors may have to accept that fine wine, like any asset, can suffer extended periods out of favour — and that even the most celebrated bottles are not immune to a prolonged hangover.