Around the world, prices on Bordeaux 2005s are being reduced – and buyers are trading down - in response to the fiscal crisis.
But merchants are advising owners to hang onto their stock as prices are not going to fall any further.
'There has definitely been a pause with the 2005 first growths [in September and October],' said Chris Adams, executive vice president of Manhattan merchant Sherry-Lehmann.
'For these months we saw bottle sales far more than case sales.'
Michael Davis, vice chairman of Chicago retailer and auction house Hart Davis Hart said he has seen 'active demand' for second through fifth Growths, and the best non-classified reds.
'Prices have not yet had time to adjust to the market conditions,' he said. 'And we anticipate prices will go down.'
In Bordeaux itself, prices on the 2005 vintage of all classified growths have slid by up to 20%. First growth Château Latour 2005 and fifth growth Château Batailley 2005, for example, have both seen recent reductions of 12%. Older vintages however - particularly the 2000s – are still robust and even increasing.
This means bargains for buyers, as merchants avoid holding onto inventory.
'Everyone in the wine industry is trying to get rid of stock,' a négociant who did not wish to be named told decanter.com.
'Prices are coming down because things are being bought to order, and people are finding the best price - whether in Bordeaux or the rest of the world. They are being far more choosy, because it's a buyer's market.'
In London, the Liv-ex 100 Fine Wine Index plummeted 12.4% in October, with 2005 first growths badly affected. Château Lafite-Rothschild 2005 fell 24% during the month. However figures for November indicate the index is stabilising.
Simon Staples, sales director at Berry Bros & Rudd, said 2005 first growth prices fell 20-25% in October, with négociants cashing in on the surge in their value since their release.
'But the only reason why the 2005s are taking a pounding is that it's the only vintage with any stock,' he said.
Staples further advised that prices appear to be stabilising.
'We are seeing people buying back in at the 20-25% reduced prices already,' he said.
London merchant John Armit fine wine buyer James Snoxell corroborated that prices are still up slightly from where they were at the beginning of the year.
'There's a bit less trading going on and people just seem to be a little bit less worried,' he said.
'I think we've got to the point where prices won't drop much more. I'm certainly not recommending anybody to sell their 2005s. Sit on it and wait for the price to come back round again.'
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What is your point? You surely cannot suggest any long-term depression in classed growth pricing based on a one-month, or short-term, trend in the middle of a world-wide economic slowdown or worse. Sensationalism? So, Latour and Batailley are down. Lafite down 25%? I do not think Eric de Rothschild is overly concerned with a one month, not least one year market snapshot. The essentials have not changed: terroir + scarcity = long-term price increases, retailer whining notwithstanding. The housing market is also depressed. I suggest now is the time to look to the future and buy the over-sized home with temp-controlled wine room, then stock it. Buyers market, period. Nothing more to be read into the matter.
T Brill, Chicago, USA
Merchants in wine try to keep the price level up by talking in order to keep inventory at a certain value. Just like bankers, real estate brokers and art dealers did. Art is now just starting trading down. The others we know the result. A lot of wine is in cellars as investment when they come out of the cellar for cash, forced or not, there will be to much offer.
Philip Cnockaert, Belgium
"Sit on it. " Excellent advice. Certainly a better idea than drinking it.
Dan Friedman, NYC, USA
It is high time for those looking for a good deal to buy and wait for the best moment to sell back.
Ram Pareatumbee
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