Bordeaux to cash in on good times

Raising a toast

London, May 9: The price of a bottle of the very finest Bordeaux is about to soar higher than ever, driven up by a second successive exceptional vintage — and by China’s insatiable thirst for an investment.

“The chateaux are saying to themselves: ‘We’d like to ask just a little bit more than last year,’” Miguel Coumau, a Bordeaux-based wine broker, said. “They reckon people are prepared to break open their piggy banks to buy their wines.”

That means a bonanza for the top 130 chateaux in Bordeaux, the Rolls-Royces of the wine trade far removed from the struggles affecting the rest of the industry in France. Wholesale prices for the widely praised 2009 vintage themselves set records, with Chateau Latour and Chateau Mouton Rothschild charging 550 euros (£480) a bottle and Chateau Cheval Blanc 700 euros a bottle.

Retail prices are higher still: a case of six bottles of 2009 Chateau Lafite Rothschild, for example — the favourite wine of China’s millionaires — is on sale on the Internet at 8,700 euros.

Dismissing critics who accuse them of provoking a speculative bubble, the wealthiest vineyards are preparing an increase of between 5 and 15 per cent this year for the 2010 vintage, according to Coumau.

The 2010 vintage will not be delivered until 2013 and connoisseurs will avoid consuming it for many years after that. But the judgement of Robert Parker, the hugely influential American wine critic, has convinced purchasers that last summer’s grapes were almost as sumptuous as the previous year’s, hailed as one of the greatest vintages ever. Parker has said the top chateaux are on course to produce wines of perfection, capable of obtaining scores of 100 out of 100 when they are bottled.

“Parker’s scores make us think that we are again looking at a great vintage, perhaps just a tiny bit less good than last year’s,” Coumau said.

Yet, however good the wine may be, most of the buyers will never actually taste it. Their intention is to sell on at a healthy profit in a few years’ time.

The investment is generally worthwhile. The Live-Ex Claret Chip Index, which charts the price of Bordeaux's top first-growth wines, is up 31.93 per cent over the past year. Moreover, analysts say there is little sign of an end to the trend so long as China's newly wealthy urban elite keeps buying the best that Bordeaux can offer.

Up to 80 per cent of Chateau Lafite Rothschild is now estimated to end up in the Far East, mainly China. Other chateaux, such as Latour, are also in high demand.

According to Gary Boom, managing director of the London-based Bordeaux Index, of 500 cases of Chateau Lafite Rothschild that he purchased recently, “400 went to the Far East and I’m keeping 100 back for people thinking of selling it to the Far East later”.

China now represents Bordeaux’s biggest export market, importing wine worth 415 million euros last year out of a global total of 3.36 billion euros.