Mature Bordeaux keeps market buoyant

Despite a “mixed” approach to 2014 Bordeaux pricing, the fine wine market is said to be in a “broadly positive” mood, although the greatest trading activity is linked to more mature vintages.

Cheval Blanc, one château attracting particular interest from buyers at the moment

A new report from The Wine Investment Fund, which does not trade in en primeur, predicted that uneven pricing strategies from châteaux for their 2014 vintage would result in an overall “neutral” impact for this year’s campaign.

While merchants have reacted favourably to releases from the likes of Mouton Rothschild and Rauzan-Ségla, other big names such as Pontet-Canet have provoked a rather less enthusiastic response.

Taking a more general look at the fine wine market, TWIF pointed to a 0.4% rise in the Liv-ex 100 during the last month as it noted “price movements were broadly consistent across wines and vintages.”

However, among top flight château, the fund highlighted Latour and Cheval Blanc as being “fractionally ahead”, while in vintage terms 1996 showed the strongest trade. Explaining this performance from a buyer’s perspective, TWIF suggested, “top vintages with maturity represent the best combination of potential returns with limited risk.”

Further evidence for the appeal of such wines was seen in recent auction results, where TWIF noted “a steady improvement in underlying conditions, with the sell-through rate increasing and solid prices achieved.”

Among the highlights in this sector, the fund picked out a case of Montrose 1990, which sold in London for £5,640 compared to its market price of £4,800. Meanwhile a case of Ducru Beaucaillou from the top-rated 2010 vintage raised £1,704 against a market price of £1,400.

Casting its gaze more internationally, TWIF recalled figures from the Conseil Interprofessionnel du Vin de Bordeaux that the region’s exports to China fell by 9% in volume and 17% in value last year in the ongoing wake of the government’s anti-corruption drive.

Nevertheless, the report balanced this observation with anecdotal evidence that “conditions have now stabilised with genuine collectors and drinkers replacing other less reliable sources of demand.”

Meanwhile TWIF also pointed to a recent Rabobank report suggesting a “significant renewed interest in wine” from Japan, with signs that this mature fine wine market is “growing most strongly at premium price points”.

In short, concluded TWIF, “We believe that May and June will see continued steady growth in prices prior to the traditional summer lull. The longer term outlook remains good, at least for carefully chosen, more mature wines.”