Covid-19 has only been officially declared a pandemic since March 11, but its effects on the economy are already dramatic. For some industries, such as the travel & leisure industry, the current crisis is likely to become the most severe since the Great Depression. In this article, we investigate the impact of Covid-19 on the fine wine market (the upper segment of the wine market). The market for fine wine is dominated by France, with Bordeaux and Burgundy accounting for close to 50% and 20% respectively of the trading activity in 2019 (Liv-ex.com, 2019). Other major players include Italy, Spain, Germany, the U.S. (for production and consumption) and China (mostly for consumption). Buyers typically include fine-dining venues – whose revenues are currently down to zero; as well as consumers, collectors and investors – whose purchasing power suffers from the economic and financial turmoil. Given the context, it appears obvious that the fine wine market will experience negative effects due to the pandemic.

But two questions remain open: how severe will these effects be? And how long will the market take to recovers?

There are two ways to answer these questions. One is based on an economic analysis of the fundamental determinants of fine wine prices. The other is based on a comparative analysis of the economic crises that have impacted the fine wine market in the past. A synthesis of these analyses is proposed before looking at a prospective conclusion on the long-term effects of this crisis.