Bargains during the credit crunch
- Friday 27 March 2009
When I was a wine merchant in Paris, I lived through two recessions. The first was in 1973-74, due to war in the Middle East and the first serious petrol crisis. It was catastrophic for top-end clarets, which had enjoyed an unprecedented speculative boom from the 1970 and 1971 vintages, but collapsed when international support vanished and the 1972 vintage showed how poor even these wines could be.
The second, from 1981 to 1984, coincided with the election of socialist President François Mitterand, which stifled the French economy and created a price stagnation until the cheerful 1985 vintage lifted everybody’s spirits. My clients did not stop drinking wine, but they switched from crus classés to crus bourgeois, from AC to vins de pays – and perfectly happy they were too.
The wine world is much broader now, vineyard management and winemaking have reached new levels, trade buyers are more skilled and, excepting the tiny percentage of wines used for speculative investment, sensible pricing at source and competition have kept prices stable. Little reason, therefore, for them to plummet alongside the housing and stock markets,but this recession will certainly throw up some great bargains.
The question is, how long will they last?
Those who hope that the economic downturn will force UK merchants to dump classed growth claret from recent good vintages may be disappointed. Still more so for domaine-bottled Burgundy and Rhône. When the credit crisis became severe towards the end of last year, it was true the investment market for blue-chip wines froze dropped, but this was due more to inaction than panic.
Those who didn’t have to sell, did not. The merchants and brokers dealing in blue-chip wines deal more on export markets and more among themselves than with the British consumer. According to Stephen Browett of Farr Vintners, the UK’s biggest trader in top Bordeaux, ‘Most merchants have sold any excess stock by now. At Farr our stocks are at an historic low and we are actively buying, though hopefully not in euros or dollars. The dumping is over and currencies will dominate the movement of fine wine this year.’
Sterling has dropped 20% against the euro, 25% against the dollar and over 30% against the yen. Asian currencies have held up well, so fine wine merchants who have an international clientele will sell there. That said, Farr’s prices reveal a marked drop at the top end for highrollers seeking to get their hands on the stellar 2005s (see box, p37).
New vintage releases, though, are a different story. The offers for 2007 Burgundy, where the whites are as good as 2006 but the reds less so, have come out at high Eurobased prices, so no bargains there. Neither are there bargains in the higher echelons of the superb southern Rhône 2007s, with Château de Beaucastel breaking the £50 barrier and Jaboulet Ainé creating a new price level for the northern 2006s.
The best Burgundies and Rhônes are onstrict allocation, so UK merchants won’t discount something that is hard to get. If they don’t take up their allocations, the wines will go to stronger currency countries. Now that the US, with its stronger dollar, has become passionate about German Riesling, prices are firm here, particularly after the very short crop in 2006.
There is talk that Bordeaux 2008s will not be offered en primeur until perhaps the autumn. This will depend on agreement between the first growths and the super seconds, while the crus bourgeois will have to sell for what they can get. But who needs 2008s bought at €1.10 to the pound, when the better 2004s bought at €1.40 are still available? It is here, in older vintages, that any bargains will be found.
An example of this is the Cuvelier family’s Château Le Crock Saint-Estèphe 2004 at £10.75 from Lay & Wheeler, or even its Château Moulin Riche Saint-Julien 2004 at £17.50. Charles Taylor Wines has third growth Margaux Château Desmirail 2005 at £25, half the cost of the over-priced second growth Lascombes. Buy while stocks last, for once merchants have solved cashflow problems, they will hold on to the good vintages.
If their top-end wines aren’t moving, merchants always have more everyday wines to sell, much more suitable for cash-strapped customers. This said, a good source of bargains should be the auction houses. Collectors who turn to Christie’s, Sotheby’s or Bonham’s may well see their wines sold at the low end of the estimate.
Auctions are also a source for mature vintages, which merchants seldom offer. For the committed collector, the first growths have seen prices from market leader Farr Vintners drop by between 15 and 40% from their peak in 2008. But then oil has dropped from $150 a barrel to $40 and the world needs to consume oil, while it doesn’t need to consume first
Two bargains, however, stand out:
La Mission Haut Brion 2005 (£3,600IB from £6,000 at Farr), as good as Haut
Brion (£6,000IB from £8,000) in this vintage, and Mouton-Rothschild 1986
(£2,895IB from £4,187 on Liv-ex), a great wine, equal to the classic Lafite 1986 (£7,800IB from £9,200).
At the top end, global economic problems should ensure such discounts continue throughout the year and the weak pound makes the wines even better value for buyers in every overseas country except New Zealand. Questioning some merchants about
where we should look for bargains in 2009, the universal response was the determination to offer value for money.
The Wine Society is concentrating on Chile, the lesser-known regions of Spain and the south of France, with its mixed case of 12 Côtes du Rhône- Villages 2007 at £64IB a steal. Lea & Sandeman is seeing 2007 Burgundies selling only half as well as 2006s, at much lower margins to stay reasonable, but is surprised by the success of the 2007 Rhônes and
determined to hold its prices for the 2004 Brunellos and other top 2004 Tuscans.
Waitrose is putting a lot of effort into South Africa, while The Vine King (runner-up in Decanter’s Small Retailer of the Year Award) is majoring on wallet-friendly Argentina.
In my view, wine drinkers are living in a golden age for choice and quality, and with the UK’s merchants to choose wines for us at prices we can afford, it may even get a little more golden.
Many merchants are offering attractive current deals on wine. Here are some recommendations from sources I use regularly (original price in brackets):
With five MWs doing the buying, Waitrose has pretty much all bases covered, but these few stand out:
■ Guigal, Côtes du Rhône 2007 £6.99
(down from £8.99) High percentages of
Clairette and Viognier make this a more
floral Côtes du Rhône white, but it retains
a certain weight.
■ Guigal, Côtes du Rhône 2006 £6.99
(£8.99) Fleshy fruit from Grenache and
structure from Syrah and Mourvèdre aged
in oak. Marcel Guigal makes almost four
million bottles yet sells to a waiting list.
■ Clos de los Siete, Mendoza 2007 £8.99
(£11.29) Michel Rolland’s Malbec-Cabernet
blend, a knock-out wine at twice the price.
Known for its deals on Champagne,
Majestic’s ongoongoing discounting policy
offers boutique wines at bargain prices.
■ Pol Roger Reserve NV £23.99 (£39.99)
My house Champagne, which I cellar for
another 18 months.
■ Bollinger Special Cuvée NV £26.99
(£44.99) More robust and winey than Pol
Roger, but no less elegant.
■ Matetic, EQ Sauvignon Blanc, San
Antonio Valley 2008 £8.99 (£10.99) The
cool climate has a bracing effect on the
newly released Sauvignon.
■ Quinta de Azevedo, Vinho Verde 2008
£4.99 (£6.24) One of the freshest, crispest
and lightest whites imaginable.
■ Muga, Rioja Blanco 2008 £6.74 (£8.99)
This family-owned bodega never puts a
■ Château Guiot, Costières de Nîmes 2007£4.99 (£6.49)
One of my house reds, fleshy
Rhône style with charm and elegance.
■ Château Larrivet Haut-Brion, Pessac-
Léognan 2004 £19.99 (£23.50 at Waitrose)
Admired by Michael Broadbent, who uses
it on the Christie’s Wine Course.
■ Château Prieuré-Lichine, Margaux 2004
£25 (£37.50 at Waitrose) A beautifully
stylish Margaux from a very good vintage.
■ Rustenberg, John X Merriman,
Stellenbosch 2006 £9.99 (£12.49) The 1999
of this wine is in my cellar and its warm
Cabernet fruit is sensational.
■ CVNE, Rioja Reserva 2004 £9.74 (£12.99)
CVNE is one of the oldest Rioja bodegas,
still family owned. Quality is impeccable.
■ Henri et Gilles Buisson, Saint Romain
‘Sous Roche’ 2005 £12.99 (£14.99)
Briary fruit. To drink or keep.
■ ‘La Ciarliana’ Vino Nobile di
Montepulciano 2004 £12.99 (£15.99)
100% Sangiovese from an historic DOCG
in a great vintage.
Regaining its loyal following after a buyout,
Oddbins is again a chain to watch.
■ Albert Bichot, Chablis 2006 £8.74
(£12.49) Bichot is a substantial vineyard
owner in Chablis with a deserved
reputation. 2006 was a great vintage.
■ Château Couhins, Pessac-Léognan 2004
£14.69 (£20.99) Grand cru classé owned by
François Lurton, one of the best whites
from the northern Graves.
■ Suavia, Soave Classico 2006 £6.99
(£9.99) Top-of-the-line Chablis minerality.
from Soave’s famous cooperative Cantina.
■ Stella Bella, Semillon-Sauvignon,
Margaret River 2006 £6.99 (£9.99) Almost
in the same league as neighbour Vanya
Cullen, this is as good as its name.
■ Château Haut-Lagrange, Pessac-Léognan
2001 £9.79 (£13.99) Estate bordering on
the crus classés, a steal for this quality.
■ De Bortoli, Shiraz-Viognier, Yarra Valley
2005 £12.24 (£17.49) Famous for sweet
whites, De Bortoli succeeds well with this
classic Aussie Rhône blend.
■ Gaia, Estate Red 2003 £13.99 (£19.99)
Gaia’s owner/winemaker remains at the
forefront of Greek quality.
■ Domaine Marchand, Nuits Saint
Georges Les Argillats 2005 £18.19 (£25.99)
Great depth of 2005 fruit will keep this
going for a decade.
■ Château de Fesles, Bonnezeaux 2003
£10.84 (£15.49) half-bottle From a famous
Loire Valley vineyard, a lusciously sweet
wine from the heatwave 2003 vintage.
Lea & Sandeman
In my view, London’s best wine retailer. Classic, innovative terroirists.
■ Château des Graves, Graves 2006 £8.50
(£10.95) 2006 was the best year of the
decade for white Graves. This Sauvignon-
Semillon blend is perfect.
■ Mario Schiopetto, Venezia Giulia 2004
£13.50 (£18.95) Chardonnay-Tocai Friulano
blend from the father of Friulan oenology.
■ Thorn Clarke, Terra Barossa Pinot Gris
2006 £6.50 (£8.95) The Clarke family has
six generations of involvement in Barossa.
This is its first Pinot Gris release.
■ Clusel-Roch, Côte Rôtie 2002 £17 (£23.95)
The southern Rhône rains didn’t reach the
north and quality was good. Lovely now.
■ Sori Bricco Maiolica, Dolcetto di Diano
d’Alba 2006 £9.95 (£13.50) Less serious
than the award-winning Barbera, but still
one of the best in the region.
■ Luigi d’Alessandro, Cortona Syrah 2006
£8.50 (£11.95) Italy’s top producer of
northern Rhône-style wines, this compares
well to a good Saint Joseph.
■ Domaine Tempier, Bandol Cuvée
Migoua 2003 £17.95 (£24.95) Most historic
domaine in Bandol. This 60% Mourvèdre-
40% Cinsault blend is justly sought after.
Country wine merchants personified. Their contacts over the years with the top French estates hold them in good stead.
■ Etienne Sauzet, Puligny-Montrachet 1er
Cru Les Perrieres 2004 £33.60 (£42)
Puligny’s only rival to Domaine Leflaive from
a vintage that is now tasting brilliantly.
■ Rémi Rollin, Corton-Charlemagne 2004
£37 (£47) Taut, with explosive power. I
bought this en primeur at a far higher price.
■ Drouhin-Laroze, Bonnes-Mares 2004
£43 (£53.60) Silky texture with the power
of the grand cru.
Additional reserach by Victoria Daskal,
Erica Loi and Fionnuala Synnott