My Latest for Wine Industry News:
California Gains Ground on the London International Vintners Exchange
by L.M. Archer
Is the ‘king’ of fine wine set to lose its crown? According to Liv-ex’s 2022 year-end report, Bordeaux faces leadership threats on the secondary market. Napa ranks among its contenders. What’s driving Napa’s rise in the world of fine wine?
Liv-ex
First, a glimpse at the market. Liv-ex (The London International Vintners Exchange) offers fine wine traders worldwide a transparent, B2B trading platform to buy and sell wine in the secondary market, similar to the New York or London stock exchanges.
Liv-ex considers “that the secondary market defines what a fine wine is, which is one that has resale value, the ability to improve over time, and has brand recognition due to heritage, critical acclaim, or some combination thereof.”
Founded in 2000 with just ten members, today Liv-ex counts 620-plus traders worldwide. These include retailers, wholesalers, importers, merchants, negotiants, investment vehicles, and a few royal warrant holders.
Trading
All transactions take place real-time, in Great British Pound (GBP). Each wine traded receives an LWIN (Liv-ex Wine Identification Number), a unique, seven-digit numerical code. “It’s like the ISBN (International Standard Book Number),” says Nick Palmer, Head of Product at Liv-ex. “It’s an identifier that can then be used universally, to make sure that there is no doubt as to what that product is.”
Interestingly, Liv-ex itself does not determine wines traded. “Liv-ex doesn’t choose what’s traded,” says Robbie Stevens, Liv-ex’s territory manager for the Americas. “In terms of brands, we act as the marketplace, in order to facilitate that trade. But it’s up to our members to decide what’s being bought and sold, and the prices they transact at. “
Currently, membership skews approximately 35% EU, 30% UK, 15-20% Asia, and 10% US. EU and UK typically lead as sellers, while US and Asia predominate as buyers. “Despite only being 10% of our of our membership in total,” says Stevens, “the US buying power was about 30% of our total purchasing in 2022.” READ MORE HERE.