London International Vintners Exchange

Last updated

Liv-ex (London International Vintners Exchange) is a global marketplace for wine trading. [1] It has over 620 members from start-ups to established merchants. Liv-ex supplies them with data, trading, and logistics services.

Contents

The platform publishes the actual prices at which wines are transacted and contains around £100m of firm buying and selling opportunities in over 16,000 wines. All are available to trade in real time. Liv-ex additionally conceived the Standard-In-Bond (SIB) contract to assure stock condition, delivery, faster payments, and provide transport and storage.

The company was founded in 2000 by two stockbrokers, James Miles, and Justin Gibbs. It started with a group of 10 founding members in London.

Trading

Liv-ex's global network enables members to trade with other merchants worldwide. Trading on Liv-ex is reserved for professional buyers and sellers of fine wine and is standardized and anonymous. As of 2018, the total value of bids and offers on Liv-ex surpasses £100million. [2]

Data

Liv-ex data is based on the activity of over 620 fine wine merchants based in 47 countries worldwide. [3] Their activity accounts for an estimated 95% of fine wine turnover globally. Trades, price updates, bids, and offers are standardized, verified, and published as tens of millions of historic lines, with thousands of daily data updates.

The data is based on real merchant transactions, rather than advertised prices which can be inaccurate and out of date. Liv-ex data is regularly quoted by media outlets including Reuters and Bloomberg.[ citation needed ]

Logistics

With operations across the UK, Europe, and Asia, Liv-ex provides its members with settlement and transport services. All services are charged at a flat per-unit rate (with no minimum quantity). All wine traded on the market passes through the Liv-ex warehouse in London. [ citation needed ] Wine stored in the warehouse can be traded on Liv-ex, without the need to be moved or checked again. Transfer of ownership can be instant.

Liv-ex Products

LWIN

LWIN (Liv-ex Wine Identification Number) is the universal wine identifier. [4] Liv-ex created it in 2011 to provide a standardized numbering system that is designed to avoid errors in communication, transfer and referencing. It removes the need to rely on written descriptions and provides the key to establishing which item in one database corresponds to which item in another database, which is helpful in transactions between organizations.

The unique seven-digit numerical code is designed to quickly and accurately identify an individual fine wine product. It enables messaging between systems and over the internet, allowing the trade to share information more easily.

Each LWIN refers to the wine itself i.e. the producer, brand or vineyard. The first six numbers of the code represent each wine's unique identifier, while the seventh number is a “check digit” that minimizes input errors. Additional information including the vintage, pack and bottle size can be appended to the LWIN in a standard format.

The LWIN standards for including additional data are:

For Liv-ex, LWINs are a foundation for the fine wine Exchange, from managing and sharing price data to maintaining the efficiency of their settlement and distribution services.

Wine Matcher

Wine Matcher is a web-based, artificial intelligence tool that allows merchants to take lists and transform them into a standardized set of wine names and formats with unique IDs (LWINs). [5] These IDs can easily be shared with other systems or entered into a database for comparison in a matter of minutes. It can also return the clean list with wine price data – such as Market Price or last trade – from Liv-ex.

In 2017, Wine Matcher was awarded "Supply Chain Initiative of the Year" by The Drinks Business . [6] The judges called it a “very clever innovation” that “has far-reaching and practical implications for the fine wine trade”.

Automation

Liv-ex Automation allows members to automate their interactions with Liv-ex.

The technology that makes this work is known collectively as APIs (Application Programming Interface). APIs allow Liv-ex's platform to communicate with merchants' system or website, without any need for human intervention. [7]

Liv-ex provides its members with market analysis, including in-depth reports and market updates. [8] They cover new releases in their News and Insights section, as well as weekly trade, and interviews with important figures in the wine industry.

Liv-ex also publishes annual coverage on the Bordeaux En Primeur campaign, as well as Power 100 – their list of the most powerful brands in the fine wine market in conjunction with The Drinks Business.

Liv-ex Indices

Liv-ex produces a number of fine wine indices that track prices for given groups of wines. [9]

Liv-ex Fine Wine 50 Index

The Liv-ex Fine Wine 50 Index tracks the daily price movement of the most heavily traded commodities in the fine wine market – the Bordeaux First Growths. It includes only the ten most recent vintages (excluding En Primeur), with no other qualifying criteria applied.

Liv-ex Fine Wine 100 Index

The Liv-ex Fine Wine 100 Index, which is available on Bloomberg and Thomson Reuters, is considered the industry benchmark.[ citation needed ] It represents the price movement of 100 of the most sought-after fine wines on the secondary market.

Liv-ex Bordeaux 500 Index

The Liv-ex Bordeaux 500 is Liv-ex's most comprehensive index for Bordeaux wines. It represents the price movement of 500 leading wines from the region and is calculated monthly using the Liv-ex Mid Price. It has been backdated to December 2003.

The index comprises six sub-indices: the Fine Wine 50, the Right Bank 50, the Second Wine 50, the Sauternes 50, the Right Bank 100 and the Left Bank 200.

Liv-ex Fine Wine 1000 Index

The Liv-ex Fine Wine 1000 tracks 1,000 wines from across the world using the Liv-ex Mid Price. It is calculated monthly and was rebased at 100 in December 2003. It comprises seven sub-indices: the Bordeaux 500, the Bordeaux Legends 50, the Burgundy 150, the Champagne 50, the Rhone 100, the Italy 100 and the Rest of the World 50.

Liv-ex California 50 Index

Liv-ex recently launched the California 50 index, which tracks the performance of the last ten physical vintages of Screaming Eagle, Opus One, Dominoes, Harlan Estate and Ridge Monte Bello.

Liv-ex Port 50 Index

In 2018, Liv-ex also created the Port 50 index, which tracks the price movements of the last ten vintages of the five most actively traded Port wines: Dow, Fonseca, Graham, Taylor and Warre.

The Liv-ex Classification

TheLiv-ex Classification 2019 is a league table that ranks the wines of the world by their average trade prices on Liv-ex. Based on the transactional activity of the world's largest pool of fine wine merchants, it reflects the changing buying patterns of the trade today. [10]

Related Research Articles

<span class="mw-page-title-main">Robert Parker (wine critic)</span> American wine critic

Robert McDowell Parker Jr. is a retired American wine critic. His wine ratings on a 100-point scale and his newsletter The Wine Advocate are influential in American wine buying and are therefore a major factor in setting the prices for newly released Bordeaux wines. This made him the most widely known and influential wine critic in the world.

<span class="mw-page-title-main">Château Mouton Rothschild</span> French wine estate

Château Mouton Rothschild is a wine estate located in the village of Pauillac in the Médoc region, 50 km (30 mi) north-west of the city of Bordeaux, France. Originally known as Château Brane-Mouton, its red wine was renamed by Nathaniel de Rothschild in 1853 to Château Mouton Rothschild. In the 1920s it began the practice of bottling the harvest at the estate itself, rather than shipping the wine to merchants for bottling elsewhere.

<span class="mw-page-title-main">Château Lafite Rothschild</span> Vineyard and chateau of Bordeaux

Château Lafite Rothschild is a French wine estate of Bordeaux wine, located in Pauillac in France, owned by members of the Rothschild family since the 19th century, and rated as a First Growth under the 1855 Bordeaux Classification.

<span class="mw-page-title-main">Wine label</span>

Wine labels are important sources of information for consumers since they tell the type and origin of the wine. The label is often the only resource a buyer has for evaluating the wine before purchasing it. Certain information is ordinarily included in the wine label, such as the country of origin, quality, type of wine, alcoholic degree, producer, bottler, or importer. In addition to these national labeling requirements producers may include their web site address and a QR Code with vintage specific information.

DeLille Cellars is a winery in Woodinville, Washington, USA. Located in the Hollywood District of Woodinville at the former Redhook Brewery, DeLille's hospitality venues include The Tasting Room and The Restaurant at DeLille Cellars. DeLille Cellars specializes in wines using the Bordeaux grape varieties: Cabernet Sauvignon, Merlot, Cabernet Franc, and Petit Verdot. In 2000, DeLille won The New York TimesWine Today.com "Winery of the Year" award. It is one of Washington state's premier cult wines.

<span class="mw-page-title-main">Bordeaux wine</span> Wine produced in the Bordeaux region of France best vinyage year of last 100

Bordeaux wine is produced in the Bordeaux region of southwest France, around the city of Bordeaux, on the Garonne River. To the north of the city, the Dordogne River joins the Garonne forming the broad estuary called the Gironde; the Gironde department, with a total vineyard area of 110,800 hectares, is the second largest wine-growing area in France behind the Languedoc-Rousillon.

<span class="mw-page-title-main">Wine fraud</span> Fraudulent activity in the commerce of wine

Wine fraud relates to the commercial aspects of wine. The most prevalent type of fraud is one where wines are adulterated, usually with the addition of cheaper products and sometimes with harmful chemicals and sweeteners.

<span class="mw-page-title-main">Vega Sicilia</span>

Bodegas Vega Sicilia is a Spanish winery located in the Ribera del Duero Denominación de Origen in the Province of Valladolid, Castile and León. The winery was founded in 1864 by Don Eloy Lecanda y Chaves, who planted various grapes from the Bordeaux wine region of France, including Cabernet Sauvignon and Merlot, which are still being used in the wines today.

Château Ducru-Beaucaillou is a winery in the Saint-Julien appellation of the Bordeaux region of France. Château Ducru-Beaucaillou is also the name of the red wine produced by this property. The wine produced here was classified as one of fifteen Deuxièmes Crus in the original Bordeaux Wine Official Classification of 1855.

<span class="mw-page-title-main">Penfolds</span> Winery in South Australia

Penfolds is an Australian wine producer that was founded in Adelaide in 1844 by Christopher Rawson Penfold, an English physician who emigrated to Australia, and his wife Mary Penfold. It is one of Australia's oldest wineries, and is currently part of Treasury Wine Estates.

<span class="mw-page-title-main">Château Durfort-Vivens</span> Winery in the Margaux appellation of the Bordeaux region of France

Château Durfort-Vivens is a winery in the Margaux appellation of the Bordeaux region of France. It is also the name of the red wine produced by this property. The wine produced here was classified as one of fifteen Deuxièmes Crus in the original Bordeaux Wine Official Classification of 1855.

Château Desmirail is a winery in the Margaux appellation of the Bordeaux wine region of France. It was classified as one of fourteen Troisièmes Crus in the historic Bordeaux Wine Official Classification of 1855.

<span class="mw-page-title-main">Abreu Vineyards</span> Winery in Napa Valley, California

Abreu Vineyards is a winery in Napa Valley, California founded by the viticulturist David Abreu.

<span class="mw-page-title-main">History of Bordeaux wine</span>

Bordeaux wine spans almost 2000 years to Roman times when the first vineyards were planted. In the Middle Ages, the marriage of Henry Plantagenet and Eleanor of Aquitaine opened the Bordeaux region to the English market and eventually to the world's stage. The Gironde estuary and its tributaries, the Garonne and the Dordogne rivers play a pivotal role in the history and success of this region.

<i>En primeur</i> While purchasing method

En primeur or "wine futures", is a method of purchasing wines early while the wine is still in the barrel. This offers the customer the opportunity to invest before the wine is bottled. Payment is made at an early stage, a year or 18 months prior to the official release of a vintage. A possible advantage of buying wines en primeur is that the wines may be considerably cheaper during the en primeur period than they will be once bottled and released to the market. However, that is not guaranteed and some wines may lose value over time. Wine experts, like Tom Stevenson, recommend buying en primeur for wines with very limited quantities and will most likely not be available when they are released. The wines most commonly offered en primeur are from Bordeaux, Burgundy, the Rhône Valley and Port, although other regions are adopting the practice.

<span class="mw-page-title-main">Screaming Eagle Winery and Vineyards</span> Californian vineyard

Screaming Eagle Winery and Vineyards is a California wine estate producing limited amounts of varietal wine; due to the small quantities produced and high prices commanded, their wines are considered cult wines. The winery is located in Oakville, California, north of the town of Napa in the Napa Valley.

Clarendon Hills is an Australian winery founded in 1990 by Roman Bratasiuk.

Harlan Estate is a California wine estate producing Bordeaux-style blends. The estate is located in the western hills of Oakville, California within the Oakville AVA, in the Napa Valley AVA zone. Harlan Estate is a "cult winery," commanding high prices due to scarcity. Its flagship wine is the eponymous Harlan Estate. They also produce a second wine called The Maiden.

The Liv-ex Classification is a classification of the wines of the world by the London International Vintners Exchange (Liv-ex), based on their average trade prices on Liv-ex.

<span class="mw-page-title-main">Pomerol AOC</span> "Right bank" Bordeaux wine

Pomerol is a French wine-growing commune and Appellation d'origine contrôlée (AOC) within the Libournais in Bordeaux. The wine produced here is predominately from Merlot with Cabernet Franc playing a supporting role. Unlike most other Bordeaux communes, there is no real village of Pomerol, although there is a church. The houses are set among the vineyards.

References

  1. "Liv-ex - The global marketplace for the wine trade. Price, source & sell wine". Liv-ex. Retrieved 2019-07-31.
  2. "New record high: Exposure reaches £50million - Liv-ex". Liv-ex. 2018-10-23. Retrieved 2018-11-25.
  3. "Data - Liv-ex". Liv-ex. Retrieved 2018-11-25.
  4. "LWIN". Liv-ex. Retrieved 2020-02-14.
  5. "Wine Matcher". Liv-ex. Retrieved 2018-11-25.
  6. "Liv-ex wins supply chain initiative award - Liv-ex". Liv-ex. 2016-05-05. Retrieved 2018-11-25.
  7. Liv-ex (2019-07-29). "Automated trading offers "huge advantage" to Liv-ex members – Independent study". Liv-ex. Retrieved 2019-07-31.
  8. "News and Insights - Liv-ex". Liv-ex. Retrieved 2018-11-25.
  9. "Indices - Liv-ex". Liv-ex. Retrieved 2018-11-25.
  10. Liv-ex (2019-07-31). "The Liv-ex Classification 2019". Liv-ex. Retrieved 2019-07-31.