THE DEMAND FOR fine wine in Asia has sent the price of the best French vintages to new highs as buyers in Hong Kong take advantage of the territory's recent scrapping of high import tariffs.
One of the most popular wines in Hong Kong is Château Lafite Rothschild 2005, which is trading at £9,600 ($19,000) per case, up from £3,300 two years ago.
The Liv-ex 100, an online index of top wines traded out of London, hit a new high in March, the most recent month for which data is available, 34 per cent higher than a year earlier.
Simon Staples, sales director at London wine merchant Berry Bros & Rudd, said he had sold £4.6 million of wine in the first 36 hours after Hong Kong got rid of import duties of 40 per cent at the end of February.
Nearly half the sales went to Hong Kong and China. "City boys in Hong Kong are saying: 'We can get our wine in for nothing now'," Mr Staples said.
The remainder of the merchant's sales went to UK investors who are expected to hold the wine for six to 12 months before selling it on to Asia.
Bordeaux Index, a London-based wholesale wine trader, said its sales to Hong Kong had soared too after the tariffs were dropped. It expects to send £20 million of wine to the city this year, double its usual amount.
Merchants expect Macau to follow Hong Kong's lead in dropping wine import tariffs, and hope China may also reduce them.
Fine wine prices have soared over the past year as increasingly wealthy consumers in Asia and Russia start collecting wine.
Prices have also been driven up as new investors, such as hedge funds and investment banks, come into the wine market.
Andrew Davison, director of the Vintage Wine Fund, a Cayman-based fund that invests in fine wines, said: "We are seeing a bit more investment flow coming in, mainly from new investors."
Some London-based traders say the US is a good source of wines as the credit squeeze puts financial pressure on some collectors.
Stephen Williams, chief executive of Antique Wine, sold a collection of Domaine de la Romanée-Conti, mostly bought from a US client, to a Chinese investor for $500,000.
