Strategic Sips

The highly anticipated annual trade-only event, culminating in Saturday’s live auction, experienced an unusual downturn this year. Average bottle prices sold for lower than normal and the auction itself, Premiere Napa Valley, raised 10% less than last year.

Undoubtedly, this decline reflects the current headwinds facing the wine industry and the prevailing sentiments within the trade community. Some prominent bidders opted to sit out, possibly due to concerns about managing their inventory levels, presenting their customers with too high a bottle price in this economy, and waiting for next year’s auction (2023 vintage), which is building up to be the ‘vintage of a lifetime’, per Napa Vintners.

The tenuous nature of wine sales have prompted trade buyers to adjust to consumer demand, seeking to limit their wine stock while also expanding their bev alc options as their own buyers look outside the wine category. Next year will be an interesting barometer to gauge whether the Premiere Napa Valley auction rebounds or if this year’s decline is indicative of future trends.

Here are a few of my takeaways:

• This year’s total fundraising of $3 million marks a decrease from the $3.4 million raised in 2023, yet it still represents an improvement from the $2.7 million in 2022.
• It’s worth noting that only one auction lot exceeded $1,000 per bottle, a rarity compared to previous auctions where multiple lots reached that price point.
• The average bottle price was recorded at $184, though I have to note there might be discrepancies in my reported averages. Others have reported higher.
• Lots with larger quantities, such as 10 or 20 cases, did not perform as well as those with fewer cases, likely due to concerns about inventory management. Only a select few lots surpassed $300 per bottle.
• For bidders, there were opportunities for deals, with notable underperformers including Silver Oak, typically one of the top-selling lots, Rombauer, which sold for just over $100 per bottle, among others.