Bordeaux 2010 futures: yawningly expensive (updated)
June 15, 2011
Well, finally. Finally, Bordeaux 2010 futures prices are out and they are expensive. The vintage was very fine, and if you are new to the game or are sufficiently loaded, then buy away: you will be rewarded with some great wines. HERE MY COMPREHENSIVE NOTES and VIDEOS. But for the rest of us, the Bordeaux 2010 futures campaign is a yawner.
I am in Bordeaux now for about 10 days for Vinexpo, and as of this writing – past midnight on 16 June – I have heard from a negociant that even the negoce is scratching its collective head: why are the prices so much higher than last year? Headlines from decanter.com give us one example, HERE. But many more abound. For many of these wines, you can find in-bottle versions for just as much if not less, so what is the point? According to this negociant, who cares not to be named, the chateaux may be taking a big gamble. They are not selling as much of their wine, he says, as they did last year, because the negoce does not want to bother. So what will happen with these expensive price tags in the long run?
For now, some merchants in the US have already told me – in quotes that I did not use in THIS ARTICLE – that the very top wines will sell, no matter what the price, but other wines from other regions that offer just as much quality for less will threaten many Bordeaux in 2010. Yes, Bordeaux remains unique, but at some price points, many customers are no longer going to pay for that. Furthermore, you have merchants like Calvert Woodley, which have been in the futures business for many years, explain to their clients in a polite way that the prices they see for Bordeaux EP 2010 are nutty: HERE. And Mark Wessels at MacArthurs, also in Washington D.C., has told me how difficult the prices are, too.
From Smith Haut Lafitte to Calon Segur, from Montrose to Pichon Baron, prices are higher, sometimes much higher, than they were for the 2009 futures campaign, and I happen to think that 2009 is just as good a vintage and even friendlier… less evidently tannic and structured but just as long lasting. So, again, what’s the point? Heck, you could buy a Pichon Baron 2000 for less money that the Pichon Baron 2010 future.
The late campaign had been frustrating merchants who said that summer vacation will interrupt purchasing (an argument I cannot understand because anyone with an I-Phone or remote internet access could order from the beach). In the US, the dollar-euro exchange rate is worse than it was last year, so higher prices are compounded by that sorry state. By last week, some merchants I know had only purchased three wines of all those released thus far. Another yawn.
Point being: many comparable wines are available in bottle and for comparable and sometimes lower prices. So why tie your hard-earned cash down for 2+ years, when you have little or no guarantee that the already high prices will not increase by the time your wines reach the shelves? The greater likelihood is that the prices will stay the same and perhaps even decrease… And provenance is no longer an issue, because if you know a good retailer/importer, you can be assured that the bottles will arrive in temperature controlled shipping when they are ready. The only reason to buy futures now is for smaller estates and in difficult-to-find formats, such as magnums.
FURTHER FOOD FOR THOUGHT…
http://www.sokolin.com/Blog.aspx?articleid=317§ionid=4
Or, if you are an economically minded Bordeaux lover, check out the cru bourgeois level wines which have not increased in price but have done so in quality. As I wrote in Wine Business International recently, cru bourgeois make their mark, cru bourgeois level wines are increasingly appealing in the US market for mere mortals. Take a wine like Sociando Mallet, which in magnum 09 or 10 EP costs less than Sociando Mallet magnum 2005 or 2000. Generally speaking. Some retailers are discounting 2005 bottles to a comparable 2010 or 2009 EP price, but mags? Nope.
Finally, those who justify the very high EP prices in 2010 are talking about Brazil and China and markets that have more recently shown interest in Bordeaux. For them such high prices are normal, it is said. But if you talk to merchants, they will tell you that they honestly do not know if the very expensive bottles are being bought to drink or for speculation. They have a feeling it is the latter. Take for example the words of John Visser, French wine buyer for Gary’s Wine Marketplace in New Jersey, into account. He told me that most people who spend $1,000 for a bottle of fermented grape juice will not likely drink it. They seek to re-sell later at a profit. Now that was happening when the release prices were lower. The bar is now so high, that the bull market could turn bearish… If you are looking for investments, perhaps better to follow the advice of Francois Mauss of the Grand Jury Europeen and invest in an apartment in Berlin. Or something else. Of course like gold the prices can head further north. But for every Lafite Rothschild, there are scores of wines whose prices will not be much different once they are to be found on shelves. Indeed, they may be discounted later.
COMING SOON
Please stay tuned for my notes from VINEXPO, the bi-annual wine fair next week, during which I will dine at some of the greatest Bordeaux estates and will taste back vintages you may have of great wines, from Cheval Blanc and Haut Brion to Domaine de Chevalier and Brane Cantenac. No matter what the prices for Bordeaux 2010 futures, I remain a Bordeaux wine lover!