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Collectors’ news: December 2010 issue

The late summer and early autumn saw dramatic rises in the price of the second wines of Bordeaux’s first growths. Carruades de Lafite, Les Forts de Latour, Pavillon de Margaux and Le Petit Mouton easily outperformed a static market which continued to consolidate strong gains made in the first half of the year.

Carruades 2007 and Forts 2001 were up 14.6% and 13.4% respectively in August, according to figures from global online trading platform Liv-ex. In contrast, Lafite 2005 softened by 2.9%, causing it to dip to £9,900 a case. While vintages of Carruades and Forts lead the way, demand for Pavillon has also been hotting up.

In August, the 2003, 2004, 2006 2007 and 2008 vintages all hit record highs, with the 2008 reaching £750 a case. This is double the price it was trading at in March and just £100 shy of the stellar 2009.

This latest price spurt is in part a knock-on effect of very high 2009 en primeur prices. But the real driver is huge demand coming from the Far East. Jamie Graham, sales director at Fine & Rare, says: ‘The demand is primarily from the Chinese seeking physical wines for the autumn gift-giving season. Above all, it’s about brand association to the first growths.’

But it’s not just Asian buyers pushing up prices. ‘Investors are realising the popularity and potential of these second wines and are buying larger quantities because of their investment potential,’ says Phil Gearing of Cult Wines.
It is now impossible to find a Carruades vintage trading at less than £2,400 a case, while Forts has passed the £1,000 case threshold for recent vintages.

While the trend is good news for investors holding stocks, merchants are finding it harder to recommend the wines to consumers. ‘At these prices you’re buying into cachet, not quality,’ says Stephen Browett of Farr Vintners.

‘Pavillon is more expensive than any other Margaux except Palmer. In Pauillac, Carruades and Forts are more expensive than Léoville-Barton and the two Pichons. For drinkers, it doesn’t add up.’

The price curve is spreading to the remaining two first growths. In September, traders noticed Petit Mouton starting to follow suit. So far, though, the recently renamed Clarence de Haut Brion has yet to make its move in quite the same way.

See next month for an in-depth price analysis of Bordeaux second wines

Written by John Stimpfig

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