Sunday, April 27, 2008

ASC Retail Wine Price List

Here's a price list I recently came across. I suppose it'd be a good place to start learning about the wine prices!

ASC Retail Wine Price List (March 7, 2008)


(Price in RMB / Yuan)

Saturday, April 26, 2008

Rationale Behind Wine Economics

“The value of wine is as much about the bottle as what is inside.”

I don’t remember where I heard that expression before, but there’s an ounce of truth to it.

Over the past 17 months, Hong Kong duties on wine has gone from a city with one of the highest wine duties in the world to duty-free - from 80% in early 2007, to 40% by March 2007 and to zero by late February of this year. Within 48 hours of the announcement by the local government, unspecified sources claimed that ~10 containers of rare wines were already headed for the HKSAR. Reservations for wine spaces at a local wine cellar sky-rocketed, which even prompted the owner to start planning transfer of wine to a new facility.

Think it’s time to join the bandwagon? I’ve been drinking wine since I was 13, but I could never quite tell the difference between country of origin and grape varieties, let alone the producer, appellation and year! If there’s anything I needed to be convinced to start studying wine, it’d be the current environment, as Hong Kong is already one of the world’s major hub for wine trading and it’s only going to get bigger. Why you ask? Well, it’s situated right next to China, where over 500 million of the middle class is only beginning to understand wine (think: ice in wine?!).

So what are the economics behind wine? Is wine really a good investment? For one thing, wine is so subjective. What RP rates as a 99 may not be the case for a lot of people, which is why there’s been so much debate over rating classifications. What about wine transporting? Often times, temperature inside reefers may not be adjusted correctly, which may cause wine to either freeze or expand due to extreme heat.

Yet, despite all of these risks, wine funds keep popping up. But don’t be fooled, the list you see on the right are the funds being offered right now. What you don’t see are funds, such as AWM Fine Wine Fund, Amphora Fine Wine Fund and Heritage Fine Wine Fund, that went bust!

The correlation between the price of a bottle of wine and its taste is weak. Unless you really enjoy wine, investing in such a commodity may be a risky proposition. Afterall, if the wine doesn’t meet your speculated return, then enjoy it yourself!

I'm know very little about the world of wine. I hope this blog will discipline myself to keep up with my anticipated learning curve. If you're a wine expert, please drop a line and leave some advice. If you want to learn about wine, I invite you to join me on this journey in search for your own rating system!