The circus has left town. The dust has settled after one of the most discussed, most fretted over and certainly the priciest Bordeaux futures campaign ever. There were many question marks when the campaign kicked off in late June, but one loomed largest: Would anyone buy the wines at these prices? Three months later, the answer is yes—but the picture is complicated.
“I was very skeptical,” said Nikos Antonakeas, managing director of Morrell & Co. in New York. “I bought accordingly, which was about 50 percent of what I bought in ’05, and was selling right at those levels.” But, he added, “[My customers] all mumbled, ‘You’d better not call another year like this one for awhile.’”
Among a sampling of 23 top wines representative of the vintage, prices at major U.S. retail outlets exceeded those of the 2005 vintage by 86 percent. (See chart of retail prices for leading properties below.) Some stateside sellers worried that with a twitchy economy and Asian markets potentially poised to pick up American slack, the campaign would scuttle itself on U.S. shores. But Jeff Zacharia, president of Zachys in Scarsdale, N.Y., sees the same old story in these concerns. “For the past 30 years we have had customers unhappy with the new prices," he said. "But most continue to buy, and for those who do not, there always seems to be someone to take their place.”
Leading Bordeaux négociants tell Wine Spectator that sales to the U.S. were down compared to past big vintages like 2005. Sales to European markets, especially London, and Asian markets, such as Singapore, Tokyo, Seoul and Hong Kong, easily made up for the difference. Mainland China, a young market for futures, also showed growth. “2008 was the first year we experienced any real interest amongst the mainland Chinese consumers for en primeur,” said Don St. Pierre, Jr., CEO of the distributor ASC Greater China. “2009 marked a significant increase in that level of interest among wealthy Chinese clients. This was the year when we saw people really try to understand what this whole futures thing is about.”
Because many top U.S. retailers expected a diminished campaign, they ordered cautiously and expressed pleasant surprise when the wines sold, if at a slower pace and more modest levels than in the 2005 campaign. “The U.S. market was much stronger than I expected,” said Zacharia. Certain wines—top scorers who kept their release prices close to $100—sold through much more aggressively than others. Retailers cite Léoville-Barton, Lynch-Bages, Léoville Poyferré and Pontet-Canet, among others.
Pontet-Canet’s owner, Alfred Tesseron, priced his wines with an eye toward the long term. “[Pontet-Canet] was sold at roughly one-tenth of a first-growth price, giving the consumer quality recognized on a similar level or even considered better than certain first-growths," he said. "Our price was fair and it reinforced Pontet-Canet's friendships throughout the world, which gives us confidence for the future.”
Despite overall success, some U.S. retailers saw longtime supporters of Bordeaux forced to the sidelines. “Everybody’s interested in them when they hear about what a great vintage it is,” said Mark Wessels, managing director of Macarthur Beverages in Washington, D.C., “[But] they say, ‘Geez Mark, I really wanted to buy a case of Cos-d’Estournel, but now I’m either not going to buy any, or I’m only going to buy three, four, five bottles instead.’ The traditional fan base, even if they can afford the wine, remember when it was a $40 or $50 bottle of wine and have a moral problem with paying $300 for a bottle of it.”
Plenty of other customers didn't, however. And Antonakeas believes that some exorbitant prices ironically muscled out those who might have bought the wines to resell them. “At $300 for Ducru-Beaucaillou, what am I going to do with it? I’m going to drink it,” he said.
“If you bought them to try to make money on them, I think you made an unwise investment,” said Wessels. The retailer consensus is that while top wines should hold their prices, few, if any, will appreciate in the near future.
And the high 2009 prices give some retailers pause about Bordeaux’s prospects in the coming years. “The pricing? OK, they got away with this one,” said Antonakeas. But “an unfortunate image [of Bordeaux] that has now been many years in the making is: ‘my father’s kind of wine.’ Unless they get serious about giving Bordeaux a little bit of a luster of youth, something to put on your table without feeling that everybody had better be older than 65, they’re going to have a problem sooner or later.”
Inaccessible prices could prevent “30-year-olds who are just coming up making their money in the next 10 or 15 years from being excited and feeling positive about Bordeaux,” said Antonakeas.
Note: Prices are average retail futures prices from leading U.S. retailers.