Bordeaux bubble bursting?

Story & photos By Dr. Michael Lim The Travelling GourmetTM

Dr. Michael Lim the irrepressible Travelling Gourmet and International Wine Judge reveals the shocking news…

MOST of Bordeaux’s most prestigious luxury wines, considered by many to be investment grade wines on par with gold…found no buyers at a hotly anticipated Sotheby’s fine wine Auction on 14 and 15th January 2012! According to Robert Sleigh, head of Sotheby’s Wine, Asia, attributed the disappointing sale to a tailing-off in demand for younger Bordeaux vintages.

Meanwhile, Jack Hibberd, Head of Data & Research at the London based Liv-Ex, which tracks and analyses fine wine markets worldwide, explained, “The Liv-Ex Fine Wine 100 Index fell by 22% since its peak at the end of June 2011. For the full year the fall was 15%.”

One stark exemplar is the price of Chateau Lafite. In January 2111, it cost 1305 Euros…in December 2011, it cost only 988 Euros!

The Chinese, freed from the chains of communism and yearning for all the capitalist, bourgeoisie trappings of “la dolce vita”, turned to “branded” premium wines in 2009. In Asia, the cultural concept of “face” or prestige and reputation in occidental terms is all important. Being able to buy and drink top-end very expensive wines like being able to drive a limited edition Ferrari means one has a lot of “face” and one does not “lose face” to one’s peers. Demand rocketed for wines beloved of ‘label drinkers’ like Lafite, Latour, Mouton Rothschild, Margaux and Haut Brion. These are the First Growths in Napoleon’s 1885 Classification, the ‘creme de la creme’ of Bordeaux wines. Chateaux, negociants and Chinese speculators pushed the price to sky-high levels, according to highly reliable sources in the wine trade.

Simon Staples, sales Director of Berry Brothers and Rudd, a famous London wine merchant, put it this way, “We explained the risks, but their passion is wine. They wanted to be part of it. Now our mainland (China) customers say they feel cheated by the 2010 futures. Some Chinese customers have even commited the ultimate Bordeaux “taboo”. They have cancelled their 2010 futures (en primeur) orders.

Vin Expo 2012 Hong Kong

At the Grand Hyatt during the Gala Dinner of the Commanderie du Bontemps de Médoc, des Graves, de Sauternes et de Barsac, an association of some of the top chateaux in Bordeaux that promotes its wines around the world, an eminent Wine merchant who prefers to remain anonymous commented wryly, “The 2011 en primeur campaign has been a complete disaster…” Emmanuel Cruse, the Comanderie’s President, mentioned “crisis” during his speech several times. He noted how difficult the economy was and hinted at how sales of 2011 Bordeaux ‘en primeur’ (futures) have gone badly for many negociants & chateaux.

In April 2012, famed Château Latour warned traders it is to move out of the en primeur or futures market, a key part of the region’s commercial strategy. Many fear the estate will sell directly to customers rather than through négociants or traders.

Meanwhile, pursuing a different strategy, Château Lafite signalled strong support for the en primeur system by steeply cutting prices for the 2011 vintage, which is still in barrels, in order to boost sales in a market that somemany perceive as overpriced.

Lafite released its wine en primeur for €350 (US$460) per bottle ex-cellar, a 50 percent drop from the average price of the 2010 vintage, brokers confirmed. The price for consumers should be €420–450 (US$551–591) per bottle. Négociant Lilian Barton-Sartorius of Les Vins Fins Anthony Barton commented, “It’s great, they came out early, which was essential this year and the price shows they are making an effort,”

11 May 2012

Latest!

Whether you love him or detest him, Robert Parker the lawyer turned wine critic, in May 2012, has forecast a complete lack of demand for 2011 Bordeaux en primeur unless prices drop “dramatically”.

The old saying goes: Play with fire and you may get burnt. This is proving to be true for those speculating in ‘en primeur’ wines from Bordeaux. To the question, “Has the bubble burst?” The answer is Yes.

On a positive note it is good news for consumers and the Travel Retail and Duty Free Wine sales and industry.

The true gourmet and connoisseur believes in buying wine for tasting and appreciation of the flavours and bouquet…and not for investing. {:-)

Zum Wohl! (German toast)

11 May 2012

Latest!

Robert Parker has forecast a complete lack of demand for 2011 Bordeaux en primeur unless prices drop “dramatically”.

Robert Parker

Writing on erobertparker.com about the vintage, he notes, “If prices do not drop dramatically for the 2011 Bordeaux, I do not think there will be any fine ‘futures’ wine market in the civilized world that will buy these wines for delivery in 2014.”

Continuing, he describes the vintage as “surprisingly successful” and compares 2011 in quality to the “underrated 2001 and 2008”, but schools producers to “price low and sell as quickly as possible”.

He also suggests the wines should be released at “reasonable price points” – something he recalls the market hasn’t enjoyed “since the 2008s”.

Indeed, he sums up, that without a significant decrease in release prices for the vintage, “2011s are largely going to bomb as ‘wine futures’”.

Parker’s views echo those of UK wine merchants speaking to the drinks business before the 2011 campaign begun in April.

Indeed, Corney & Barrow MD Adam Brett-Smith told the drinks business back in December 2011, “Unless they [the Bordelais] do something of unbelievable drama there is going to be no interest at all.” Parker says in general, “Pomerol stands out as the most consistent appellation” while the “least consistent” was Graves/Pessac Leognan.

Advertisements

About thetravellinggourmet

As a renowned Travel, Food & Wine Writer he has travelled the world in a keen & indomitable pursuit of exotic delicacies & fine wines. His articles have been published in over 20 prestigious publications, both local & international. Dr. Lim has toured and trained in Wine Evaluation & Oenology in most of the world's top wine producing areas from France to Australia. The Travelling Gourmet says, "Gastronomy has no frontier. These are the gastronomic voyages of The Travelling Gourmet. My unending mission. To explore strange new cusines, to seek out new wines and new culinary experiences, to boldly go where no gourmet has gone before...." All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording, or any other information storage & retrieval system, without permission from Dr. Michael Lim The Travelling Gourmet and/or MSN. Material may be works of fiction. Names, characters, places and incidents may be true but may also be products of the author's imagination or are used fictitiously. Any resemblance whatsoever to actual person or persons, either dead or living, events, or locales may be entirely and purely coincidental and unintentional. No part of this website may be used to villify others or for criminal purposes. Interests: Travel, Food, Wines, Cooking, Wine Appreciation, Parachuting, Languages, Music, Reading, Swimming, Hunting, Ballet, Fencing, Archery, Anthropology and more... The Travelling Gourmet is a copyrighted trademark. All rights and photos reserved. No part may be reproduced without permission.
This entry was posted in Wine Appreciation. Bookmark the permalink.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

w

Connecting to %s