Comments on: Wine investment in the news

By: Simon Staples

Simon Staples — Thu, 26 Nov 2009 09:45:19 +0000

The quality will gradually increase as good practice filters down through hierarchy of Chateaux but I fear that if these markets do get the taste it will effect the demand on most of the classified growth and probably in this order: five Firsts, 12 of 14 Second Growths, 12 of the 15 third Growths, all 10 Fourth, 14 of the Fifths, plus 15 Pessac and Graves properties and 30 Right bank. That’s about 100 with an average of 12,000 cases each plus half of their second wines, you can see that 1 to maybe 1.8 million cases could easily get sucked up with very little effort. Obviously there is no panic for us at this moment to be able to get good value great claret but even since 2006, and the release of the great and hugely expensive 2005, First Growths we have seen an enormous shift as to where these wines are being consumed…….and it’s not the UK, States or Europe. Of course the other train of thought is these markets might go crazy for Chile or New Zealand but I would recommend that wouldn’t be the safest bet. We are already seeing the Lafite effect beginning to affect Mouton and I can only see that going one way. If I had to predict which wines will move fastest/soonest I’d say it be in the vintages of Mouton and Latour (Particularly 2008/2006/2005/2004/2003/2001/2000/1996) then Margaux and possibly Haut Brion….Cheval…. Hope that helps. Do give me a buzz on 01256340264 if you want to chat it through.

Many thanks, Simon.

By: james

james — Wed, 25 Nov 2009 11:31:18 +0000

Simon,
That does answer my question thanks.
It also partly answers another one I was pondering. Which producers may be the favoured ones? You have mentioned 100 to 200 chateaux, whereas I would have expected a much lower number.
Does that mean there will be more wines of a higher quality on the market?
Will it affect the availability of wines for drinking in the shorter term rather than for investment?

By: Simon Staples

Simon Staples — Wed, 25 Nov 2009 10:34:45 +0000

Hi James,

I think I get your question. En Primeur prices will definitely be up for the 2009’s in May next year, as it looks excellent at this point. If China/Korea and a few other markets get the taste, and I must stress we haven’t come close to even touching the surface of this potentially enormous market yet, this really should make the release prices move up for the top 100/200 Chateaux. They can’t make more, and most are improving their quality so reducing their yields. The volume we are talking here is only 1.2 to 2 Million cases for those 100/200 chateaux. This is excluding India, who I am very confident will drop their current prohibitive import tax and would embrace Fine wine with gusto over the next few years. I hope that helps?

By: james

james — Wed, 25 Nov 2009 10:03:44 +0000

The article suggests that the Asian market will push up prices of fine wine so that those who have cellared some already might make good gains.
Does the Asian markets interest in these wines also mean that producers will put up prices for En-Primeur wines. In the expectancy that we will want more in order to make future profits?
Apologies if that was a badly asked question, but I think I know what I meant!
Regards
James