The case studies below compare and chart wine prices over time for 4 Bordeaux wines from different vintages. (Source: Liv-ex.com)
2000 Château Gruaud-Larose
2000 Gruaud-Larose as the first of the major Bordeaux châteaux to release the 2000 vintage of their wine. The BBR opening price in April 2001 was £250.00 per case in bond.
The chart below shows the liv-ex average list price of this wine over the past ten years. Relatively unaffected by the ups and downs of traditional markets, this has proved to be a very sound buy for those that bought en-primeur.
2005 Château Lafite Rothschild
2005 Château Lafite Rothschild was released in June 2006. The BBR opening price was £3,960 per case in bond. The market price for this wine moved little until the spring of 2007 then moved at some pace, just touching £10,000 per case in May 2008. A real “credit-crunch” wine, the price fell at the end of 2008, then recovered in 2009 before peaking again in the Spring of 2011.
Global economic malaise hit again and in February 2012 the wine could once again be bought for less than £10,000 per case in bond. This is a perfect example of a wine whose price has been strongly influenced by speculation, though early buyers will still be sitting on an asset whose value has increased significantly since its release.
2005 Château Pontet-Canet
2005 Château Pontet-Canet was released in June 2006. The BBR opening price was £498 per case in bond. Whilst this was the most expensive release of Pontet-Canet ever (the 2004 was released at £240 per case) this château has a growing reputation as a superstar, with the price doubling since its release.
2008 Château Lafite-Rotschild
The worst example of the global economic crisis hitting the Fine Wine market. Released at a giveaway £1,950 per case in bond (though the wine was offered on allocation), 2008 Lafite found its way very quickly to more than £4,000 per case within months. Heavy speculation followed, particularly on potential demand from the Far East, and the price exceeded £15,000 per case in December 2010. The price fell throughout 2011 following the global economic issues and Robert Parker’s re-appraisal of the vintage from bottle.
What affects wine prices
Wine prices can fluctuate for many reasons. Some key examples are:
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Robert Parker, the acclaimed US ‘Wine Critic’, has astounding power. His power is such that the Bordelais will rarely release their latest vintage until Mr Parker has ‘scored’ the wines. A re-rating of any wine (ie a change in score, either upward or downward) can affect the price of a wine almost immediately, with an upgrade provoking a spike in price as buyers chase the wine, or a downward movement as sellers (either private or trade) seek to sell a wine that has been downgraded.
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Stock Availability. Wine is an expensive stock to hold, and the stock position of any merchant can affect the price of a wine. Anyone holding a significant amount of any given wine can affect the price: if a merchant with 200 cases of Château ‘X’ decides to discount that wine in order to clear their stocks, this will depress the price for that wine until the stock has sold. Likewise, if stocks of Château ‘X’ are plentiful throughout the trade, it is unlikely that buyers will be keen to buy.
Much as there is little close correlation between the wine market and the financial markets, the wine market can be affected by the wider economic situation as we saw in late 2008. Moreover, with more investment money in wine than before, there is an argument that we may see more price fluctuation than before.
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