Investors are coming back to Bordeaux.
It’s early days. Very early days. But looking at the investment wine market, it’s easy to see, in the graphs and figures, that investors are coming back to Bordeaux.
We may, and I repeat may, have seen the bottom of this market.
I better give you some figures to back it up…
In December, Bordeaux’s first growth share in the Liv-ex 50 grew from 26-32%, with the 2005 vintage coming back into favour (comprising almost 20% of Bordeaux trade).
This represents a small ripple of change following the tumbling prices in 2014, and I would put it partly down to a positive re-review of Parker 2005 scores (2005 has taken over the 2009 and 2010 Bordeaux vintages as the current champion in trades.)
Demand for Bordeaux, and the 2005s in particular, is notably up in Asia, and there have been comments from analysts of greater stability following what has been three years of falling prices. It must also not be forgotten that despite Bordeaux’s recent slump, while other regions, like Australia, have prospered, it still represents the bulk of the wine investment market.
This trend is further highlighted by a recent Sotheby’s auction in Hong Kong – ‘Chateau Mouton Rothschild: Direct from the Property’ – a record-breaking Mouton sale, which saw lots sold 93% above their ‘high’ estimate, and a total value of US$4.1m.
The auction included a world record Mouton vertical (66 bottles) across 68 vintages from 1945-2012, selling for US$376,900.
But the records didn’t stop there, with a bottle from the 1870 vintage, plus lots from 1945, the great 1961 and 1982 all breaking records.
It must also be noted that the auction was also a commemoration of the Baroness Philippine de Rothschild (bless her soul), with a hefty dose of the sales going towards the Baroness Philippine de Rothschild Foundation for the Arts. This would have bolstered prices further.
Another really good sign for the wine investment market is that it’s not just good news for Bordeaux. There is no sign that buyers are shifting to Bordeaux at the expense of other regions, and both Italy and Burgundy have increased their shares on the Liv-ex, and all Liv-ex indices are up in January over December.
The Liv-ex 100 showed the biggest gain, with a 1.9% increase on December – its largest monthly rise in two years. The Liv-ex 50 wasn’t very far behind though at 1.8% month on month.
However, as I said at the beginning, it is still very early days, and until we get a good few month’s more data, call it a year, you can’t really call this a trend at present.
The proof of the pudding will be at the end of 2015, with a full year’s worth of trading figures to go on.