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A Busy Monday in Bordeaux: More 2010 Futures Prices

Châteaus Margaux, Cos-d’Estournel and L’Evangile release prices on their 2010s
Photo by: David Yellen

Posted: Jun 27, 2011 11:00am ET

Today was a busy day in Bordeaux, as several big-name châteaus finally released their 2010 futures prices, including Châteaus Margaux (96-99 points in my 2010 Bordeaux Barrel Tasting), Cos-d'Estournel (96-99) and L'Evangile (94-97).

It came as no surprise that Margaux increased its price over its 2009, to 600 euros from négociant up from 550 last year, and according to one négociant, demand has been very robust for both the château's grand vin and second wine, Pavillon Rouge, despite the increase in price.

On the flip side, Cos and L'Evangile raised some eyebrows when they released prices with a minor decrease and a flat level, respectively, vis-à-vis their 2009s.

Cos dropped its négoce price from 210 euros for the 2009 to 198 euros for the 2010; L'Evangile's price for the 2010 remained the same as for its 2009 at 180 euros. "I thought it was the correct price, despite the fact production was 20 percent less," said Christophe Salin, general director of Domaines Barons de Rothschild (Lafite), which owns L'Evangile. (Château Lafite Rothschild has yet to release its 2010 price.)

But despite the pricing moves of Cos and L'Evangile, the market has apparently reacted with a bit of a shrug.

One major négociant chose not to comment directly on the sales of Cos, saying only, "It's really scores, brand reputation and worldwide brand recognition [that move the wine]. Just dropping prices isn't a guarantee to move the wine. The châteaus that went from 80 to 200 euros in the last few vintages have really slowed down this en primeur campaign. The difference in '09 was the fact everyone was jumping back into the market after being away for a few years and so the buying was more widespread."

Don't you find it interesting that consumers are asking for prices to come down, yet the buying still seems to be linked more to label and prestige than actual value?

James Molesworth
Senior Editor, Wine Spectator —  June 27, 2011 12:10pm ET
And it looks like another big name has dropped its price as well: Château Ducru-Beaucaillou released its '10 and is currently ex-négoce at 150 euros, down from 180 for the '09.

The wine had a lot of buzz around it during the en primeur tastings (though the château declined to submit a sample to my blind tasting), so it will be interesting to see how it moves...
David A Zajac
Akron, OH —  June 27, 2011 2:45pm ET
Not that I am buying, gave up Bordeaux futures years ago, but do you really think if demand was as high as they all say, two of the premier second growths in Cos and Ducru would decrease their prices? Makes no sense to me, but then again neither do these prices.
Jamie Sherman
Sacramento —  June 27, 2011 5:24pm ET
For me, Bordeaux has become more of a curiosity then a reality. Skyrocketing prices over the last decade have left me deflated and even small decreases fail to peak my interest. In 2000, Ducru was 100 dollars, Pontet 55, and Margaux 400+. Margaux was a special treat worth buying still but now unreachable. Ducru is now in that special treat price range but it just doesn't seem as special splurging for a second growth.
Ivan Campos
Ottawa, Canada —  June 27, 2011 6:31pm ET
I think we all intuitively understand that a) if demand was even comparable to 2009, prices would have remained constant for these wineries, and b) that we are not likely to have a non-partisan view from within the industry: if one person indicates that demand is lackluster for the wines he represents, demand will plummet until prices go down, and he'll be out of a job.

We all want to have a few fancy bottles of wine in the cellar, but I rather have them accompany a good story, rather than just knowing that the extra cost is going to pay for upgrades to the castle that the proprietor inherited. As more wine savvy consumers look to impress through their knowledge of specific regions and up-and-coming wineries, I expect to see more pressure on bordeaux chateau to develop distinct brands.

Finally, it would certainly be interesting to see what would happen if the major publications decided to recuse themselves from the Bordeaux circus for a couple of years, and stop giving these wineries so much free publicity....
James Molesworth
Senior Editor, Wine Spectator —  June 28, 2011 7:25am ET
Château Palmer holds the line, Vieux Château Certan takes a %15 increase. Château Mouton Rothschild matches Margaux at 600 euros, while taking a hefty increase on its second wine, Petit Mouton (108 euros, up 60 percent on the '09)...

Interesting that some chateaus are taking their biggest increases on the second wines - which for many now make up 30 percent or more of the crop.
Jeffrey Ghi
New York —  June 28, 2011 10:44am ET
That's amusing. 100$ for some leftover juice the chateaus couldn't be bothered with?

But this is certainly not supply and demand and I think people misunderstand that about the heavy hitters in bordeaux.

There about 120k ultra high net worth individuals world wide (people with over $50mm in investible assets).

What is the total case production across all of the first and second growths? Half a million a year? that's basically 120k of these people drinking 5 bottles of wine a year (if they only get the very best).

But you might ask, not everyone drinks wine. True, but most ultra high networth individuals don't buy a bottle at a time, they buy them cases at a time so i'd say it averages out.

Now add in the rest of us that can afford to buy and occasionally the good stuff. There are over 10 mm of us world wide with total assets over 1mm$ but under 5$mm.

Sounds like the well known chateaus have all the demand, and not enough supply.

Which is why i don't think you'd ever see Lafite come back down from the stratosphere.
David A Zajac
Akron, OH —  June 28, 2011 11:22am ET
Jeffrey, not that I am justifying what the prices are, as I think it is ridiculous, but the first growts are all making much less of the top wine compared with 10-20 years ago because they are trying for the home run every year, so where Lafite's case production used to be 20,000 cases/year, today its maybe 12,000 with the balance of the juice flowing into the second wines. This would have been bottled under the first label a few years back, but not today. Does that justify $200/bottle for the second wine of Latour, Lafite or Margaux, not in my book, but the reasoning is sound, if not the economics.
Jeffrey Ghi
New York —  June 28, 2011 11:55am ET
I didn't think about that David and I must admit my limited experience from first growths wines pre 2000 and even in my limited buying, I'd say the prices are abhorring! But more power to them, can't fault them for being capitalistic eh? I'm more of a port guy anyway, and thankfully I can buy a "premier growth" port if i saved up a month of salary =)

Add to that, that the chateaus can literally store this stuff indefinitely on some cheap land/warehouse anywhere they want to means they can hold back as much supply as they want too.
Christopher Fox
Rochester, NY —  June 28, 2011 2:07pm ET
Funny that the fine vintages of the 90's and 80's are still less on the auction market than prices for current vintages. Mouton '89,'95 & '96 are all well under $600. So are the 100-pt '89 and '95 Margaux. Lafite, of course, is on a whole other price curve, but aside from that, '05, '09, and '10 first-growth prices (and second growths) are much more than current prices for past great vintages. I'd be curious what others think - do the comparatively lower prices of the wines from 89/90/95/96 vintages represent a buying opportunity? Or are they indicative of the financial risk someone is taking in buying current-release first growths at current prices?
David A Zajac
Akron, OH —  June 28, 2011 3:02pm ET
To my mind, the 89 - 96 wines are basically priced fairly, I wouldn't call it a buying opportunity but I wouldn't say they are over priced either, at least in comparison to what other wines are being sold for these days. The current prices are the issue, can they continue - who knows and doesn't it make you wonder when the likes of Cos and Ducru are dropping prices on "the greatest vintage ever"? I honestly believe the wines for the uber rich don't belong in this category as money is just not an issue, and this has become their trademark, so to speak. Its no longer a product to consume with friends, its a status symbol of their wealth - I can't relate unfortunately, but neither will I be drinking Lafite any time soon.

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