First Growths: back to 2011

Last month, the Liv-ex 1000 index reached a record high for the seventh consecutive month. The index previously reached a high in July 2011 at the peak of the China-led bull market before falling to a low in August 2014.

Other Liv-ex indices have not been making the same records. The Liv-ex 100 has been rising, but is yet to surpass its previous highs; the Liv-ex Fine Wine 50 – which tracks the daily price movements of the First Growths – remains 22.8% below its peak in 2011.

Still, several First Growths are now close to or above their 2011 Trade Prices. The chart below shows those that are within £500 of their highest prices during the bull market.

Mouton Rothschild and Haut Brion are both well represented, and a handful of Latour and Margaux vintages have climbed back to levels seen six years ago. As yet, no Lafite Rothschild vintages feature.

FG trade 2017 v 2011

Six of the wines shown above are currently commanding higher prices than during the bull market (2010-12). Mouton Rothschild 2003, for example, currently has a Trade Price of £4,500 per 12×75, marginally higher than levels reached in 2011.

mouton 03

Others are inches away from breaking through their previous highs. Mouton Rothschild 2002, for example, is just 0.6% off its peak Market Price.

As the fine wine market continues its momentum, it remains to be seen if trade prices will continue to rise.

Bull market prices are the highest price that the wine has traded at between the 1st January 2010 and 1st January 2013. The 2011 wines were released towards the end of this period, after the market peaked.


Spotlight on… Lafite Rothschild


Owner: Baron Eric de Rothschild

Classification: Premier Grand Cru (First Growth)

Vineyard area: 115 hectares

Colour: Red

Standard blend: Cabernet Sauvignon (80-95%), Merlot (5-20%), Cabernet Franc (0-5%), and Petit Verdot (0-5%).

Total annual production: 420,000 to 480,000 bottles


Records show that the first vines were planted at Lafite in the 1670s. Early customers included both British Prime Minister Robert Walpole and US President Thomas Jefferson.

In the years following the French Revolution, Lafite changed ownership numerous times until Baron James de Rothschild purchased Chateau Lafite in August 1868. Henceforth the estate became known as Chateau Lafite Rothschild.

The end of the 19th Century and the beginning of the 20th Century were turbulent decades for the Chateau. The vineyard was severely impacted by the phylloxera crisis and mildew, forcing the estate to declassify certain vintages between 1882 and 1915. Furthermore, during World War I the estate was severely impacted by supply restrictions and the financial crisis of the Great Depression led to a reduction in vineyard area.

During World War II, both Lafite Rothschild and Mouton Rothschild were confiscated and placed under public administration. A German military base was then stationed at the two Chateaux for the entire length of the occupation. By the end of 1945, the Barons de Rothschild recovered possession of Lafite and Baron Elie was responsible for re-establishing operations at the estate. A series of excellent vintages in 1945, 1947 and 1949 helped fuel efforts to re-establish Lafite Rothschild. The 1955 vintage was evidence of the wine’s rebirth. The emerging markets in the US in the 1960s, and Asia more recently have continued to help grow Lafite Rothschild into the brand it is today.

Market Performance

During the Asia-led boom for fine wine (2009-2011), Lafite became a ‘super brand’ in China and prices skyrocketed – even more than the other First Growths – as the chart below shows. Over a two-year period, the Lafite index gained over 140%.

The popularity of the brand during this period is perhaps exemplified by price movements for the 2008 vintage. In October 2010 it was announced that the bottle would carry the Chinese symbol of the figure eight, representing good fortune. The market quickly responded with trades 67% higher than in the previous month.

Lafite v FG indices - ten years

When the market started to roll over in mid-2011, prices for Lafite began to decline. In two years, the index dropped 37%.

Recovery period

At the beginning of 2016, Lafite began to show tentative signs of recovery. It is now the best-performing First Growth over one year, up 29.2%. It has outperformed the Fine Wine 50 which is up 25% over the same period.

Lafite v FG indices

Market Prices

The chart below compares Lafite Market Prices to their Wine Advocate scores. Lafite partly follows the traditional pricing pattern for fine wine, where prices rise as the wine ages and supplies diminish. However critical acclaim also appears to have some influence, with high-scoring vintages such as 2008, 2009 and 2010 commanding premiums.

Buyers willing to wait might consider the 2014 and 2015. The wines have similar scores to older vintages, but their prices are still waiting to catch up. For example, the 2014 vintage is currently trading at a discount of 30.7% to the similarly-scored 2006.

Price v Score bar

Vintage performance

The recently physical 2014 vintage has been the top performer over the past twelve months, up 40.1%. This time last year the wine was the cheapest vintage available on the market. The similarly priced 2013 vintage followed behind with a 32.5% increase. The 2009 and 2011 have been the slowest movers of the Lafite vintages, up 23.7% and 20.3% respectively.

Vintage performance


Talking Trade: Bordeaux and Burgundy focus

Trade by both value and volume dipped this week. The market turned its focus to Bordeaux and Burgundy which collectively accounted for nearly 95% of trade by value. Activity for all other regions was reduced. The Fine Wine 50 index edged higher – up 0.6%. It is currently less than 1% below its 5-year high in March 2012.


Blue chip traders

The Bordeaux First Growths took an increased 31.4% of trade by value this week. While Lafite was the most traded of the Premier Cru overall, two Mouton Rothschild vintages feature in the ‘top by value’ table.


Latour release – “Mixed reaction”

Absent from the table was Latour 2005. On Tuesday, 3,000 cases of the wine were released from the Chateau at £7,800, a 14.7% premium to Market Price. Previously, ex-Chateau releases from Bordeaux have triggered activity for lower-priced cases in the secondary market. This week, Liv-ex saw Latour 2005 trade at £7,000 per 12×75. This follows a handful of trades the previous week at £6,700.

The Drinks Business reported a “mixed reaction” to the Latour release, suggesting that sales were “apparently very strong in places and merely reasonable in others.”

Bordeaux 2014 – coming soon

Neal Martin’s report on Bordeaux 2014 in bottle is expected at the end of this month. This week, a handful of wines from the vintage traded including Pavillon Rouge, which was the most active by volume, and Montrose which has seen a flurry of trades recently.


Also in the news

Also in the headlines this week was Laurent Ponsot’s decision to leave the family’s estate in Burgundy to establish his own winery in the region. Liv-ex published a short article looking back at the performances of Ponsot Clos Roche Vv vintages over the past year. The Liv-ex Blog also published an update on the Super Tuscan indices, highlighting a recent drop for Tignanello.

Super Tuscans: Tignanello off peak


The Tignanello index – which tracks prices for the ten most recent physical vintages – increased by 27.1% in 2016. Over a one year period, it remains the strongest of the Super Tuscan indices. However, so far this year the Tignanello index has slumped while its peers have continued to make gains.

Tignanello generally offers attractively lower prices relative to other major Super Tuscans. Its highest priced recent vintages, the 2004 and 2006 – £1,094 and £1,518 per 12×75 respectively – are priced at around the same level as Sassicaia’s low and mid-priced vintages. However, it appears that buyers previously hunting Tignanello value may now be looking elsewhere.

Of the last ten physical vintages, the 2005 has fallen the most so far this year, down 15.5%. It is closely followed by Tignanello 2004, down 15.3% over the same period. The 2008 has bucked the trend by gaining 13.6%.

Italy’s share of trade by value dipped in 2016 (6.1%), but has bounced back this year and was at 6.5% in February. Sassicaia 2012 and 2013, and Altesino, Brunello Montalcino 2012 were the most active Italian wines last month.

A version of this report was originally sent to Liv-ex members in an email update last week.

Ponsot: Clos Roche performance


Last week in an interview for Wine Spectator, winemaker Laurent Ponsot announced plans to leave the family’s Burgundy Domaine and establish his own winery in the region. In light of this recent news, Liv-ex has looked at the performance of Ponsot Clos Roche Vv over the past twelve months.

Year-on-year, the Ponsot Clos Roche Vv index – which tracks the performance of the ten most recent physical vintages – is up 25.4%. Its parent index, the Burgundy 150, is up a similar 25.9%.

As shown in the table below, the 2008 vintage has been the top price performer over the past year: it is up 71.4%. Despite this significant increase, it remains one of the cheapest vintages available on the market. The 2010 follows behind with gains of 36.4%. In November 2016, the wine traded at an all-time high of £4,958 per 12×75.

However, performance is not positive across the board: recent vintages 2011 and 2013 have dropped 10.1% and 13.5% respectively.

None of these come close to the heights of the acclaimed 2005 which has edged above £10,000 per 12×75 – a ‘wow’, wine, according to Allen Meadows (Burghound), with a price tag to match.


Latour 2005 and Forts Latour 2011 released ex-Chateau

Latour 2005

Today, Latour 2005 and Forts Latour 2011 have been released ex-Chateau. 3,000 cases of Latour 2005 are being offered at €670 per bottle ex-negociant, and at around £7,800 per 12×75 by merchants. As the chart above shows, this represents a premium of 14.7% on cases of the wine available in the secondary market.

This price also positions the release above the ‘fair value’ trend line, shown below, and places it above the 100-point Latour 2003.

Unlike many other First Growths, prices for Latour 2005 have stagnated over the past 12 months. It has increased by 4.2% compared to gains of 25% for the Fine Wine 50 index.

Still, anecdotal evidence suggests that merchants are confident the wines will sell through, despite the premium.

Latour 2005 release

Forts Latour 2011 has been released at €140 per bottle ex-negociant, and is being offered by merchants at around £1,650 per 12×75. This represents a premium of 17.9% on the wine’s Market Price of £1,400.

Like many of the second wines, prices for Forts Latour 2011 have risen rapidly over the last year. It is up 29.6% since March 2016.

Forts Latour 2011

Last March, Latour 2000 and Forts Latour 2009 were released at premiums of 12.5% and 20.9% to their Market Prices respectively. In September, 3,000 cases of Latour 2007 were released at Market Price. Merchants reported strong demand for the release of the 2000, and some interest in – though lower sales for – the 2007.


Talking Trade: Bordeaux steady, Lynch Bages takes charge


Activity for Bordeaux was steady at 66.8% this week, but its share of the market by value continues to be low in historical terms. This week Latour announced that it would release its 2005 grand vin later this month. As always, there is market speculation surrounding its ex-chateau release price.

In general, the First Growths have continued to see prices rise. The Fine Wine 50 closed Thursday higher at 341.39 (+0.5%), edging closer to its five-year high of 347.08.


It was another busy week for Italy and Champagne. The two Montalcino 2012s (Altesino and Argiano) featured again. Poggio San Polo Brunello Montalcino 2010 was also active. The most traded Italian vintages were the 2014, 2012 and 2010s.

Trade for Burgundy was much lower this week and dipped below its average of 7.9% for 2016. The region has seen a strong start to 2017, registering 18.4% and 14.2% of trade by value in January and February respectively. DRC Tache 2012 and DRC Echezeaux 2013 both featured in the top wines from Burgundy this week, alongside Prieure Roch Nuits Saint Georges Clos Corvees 2013.


The top wines traded by value were from Bordeaux and Champagne. Angelus 2011 was top and traded at an all-time high of £2,285 per 12×75. According to Robert Parker, the wine is “supple and sexy with lots of blueberry and black raspberry fruit intermixed with liquorice, barbecue smoke and camphor.” He awarded it 94 points.

Latour 1996 was also active. It is a wine that has divided critics at The Wine Advocate. Parker awarded it 99 points calling it a “spectacular Latour.” It “continues to perplex” Neal Martin who awarded it 95 points.

Lynch Bages 2008

93-point Lynch Bages 2008 hit an all-time high of £1,013 this week. It is up 23.4% year-on-year, and 9.8% on its previous trade price of £923.


Looking for weekend reading? This week, Liv-ex published two blogs on the forthcoming Latour 2005 releaseLatour 2005: ‘Fair Value’ among the back vintages and Latour 2005: a chequered past. Liv-ex also published the merchant prediction results from its survey Fine wine merchants bullish in 2017 – survey results.



Latour 2005: ‘Fair Value’ among the back vintages


With ex-chateau releases of Latour 2005 expected later this month, yesterday’s blog looked at the ‘chequered’ past of Latour 2005. To continue the Latour 2005 theme, today’s Liv-ex blog examines ‘fair value’ among the chateau’s recent back vintages.

The chart above plots prices for the last ten physical releases of Latour (2002 – 2011). The trend line shows that not all Parker points are equal – lower scoring vintages tend to trade at similar prices, while Parker points become increasingly valuable for higher scoring vintages.

The trend line might be helpful in determining a wine’s ‘fair value’ with vintages below the line potentially offering greater value for money than those above the line, based on the score from Robert Parker.*

The chart highlights that Latour 2005 is only 0.2% above the price suggested by the trend line and may not be considered significantly overvalued at its current Market Price of £6,660 per 12×75. In contrast, the 100-point 2009 and 2010 are both above the suggested price, by 7.3% and 16.8% respectively.

The other high-scoring 100-point 2003 appears to be the most mispriced vintage, falling 24.1% below the trend line. It is also currently offered just above the 98-point 2005 at a Market Price of £7,140. In his 2014 tasting note, Robert Parker said the 2003 is “undeniably the most sumptuous, opulent wine made [at the chateau] since the 1982 or 1961.”

The release price of Latour 2005 will undoubtedly be a major factor in determining its success or failure. The last ex-chateau release was Latour 2007, released at the same level as the Market Price. With the 2005 currently available in the secondary market close to ‘fair value’, a release at this level would likely generate interest from buyers.


* Liv-ex recognises there are other factors that influence the price of fine wine such as brand, vintage and age. However, the chart and trend line offer a useful starting point in the identification of wines that might be mispriced.


Latour 2005: a chequered past


This week Latour announced that its first ex-chateau release of 2017 will be its 2005 grand vin, 2011 second wine (Forts Latour), and 2012 third wine (Pauillac de Chateau Latour).

As can be seen in the chart above, 98-point Latour 2005 has not seen significant price growth since the Bordeaux market started to recover at the end of 2015. It is up only 2.4% since December 2015. Over the same period, 95-point Lafite Rothschild 2005 is up 36%, while 100-point Haut Brion 2005 has increased 22.8%.

Latour 2005 has something of a chequered past. It was originally seen as a potential ‘perfect’ wine. Robert Parker first awarded it 98-100 points in barrel and its price increased rapidly in the two years before physical release, rising 126.7% between April 2006 and April 2008.

When finally released in bottle, Parker awarded it a reduced 96 points and its price subsequently fell. Even during the dizzy heights of the China-led boom the wine failed to match the price level achieved during its pre-bottle phase. Although Parker did finally upgrade the wine to 98 points in his ten-year retrospective of Bordeaux 2005, this did not appear to do much to revive interest in the wine.

Liv-ex will follow this blog tomorrow with a more detailed analysis of the Latour release using its ‘fair value’ methodology.



Fine wine merchants bullish in 2017 – survey results

Liv-ex 100 in 2017: merchant predictions

Liv-ex members are expecting the fine wine market to rise further in 2017, according to the results of a survey conducted in February.

On average, respondents expect the industry benchmark Liv-ex 100 index to increase by 7.8% this year to close on 320.6. This would represent a second year of strong gains for the market.

So far, the index is has edged up by 1.7% after posting gains in both January and February.

The vast majority of respondents expect the index to move upwards. 89% of those surveyed predicted that the index will rise; just 9% think it will fall. A small handful expect it to run completely flat.

The most optimistic respondent expects gains of 31%; the most pessimistic predicts a drop of 15.9%.

In 2016, members underestimated price rises for the year. Their average prediction was for gains of 5.4%. The reality was an increase of 24.8%.

Liv-ex members represent the largest pool of professional fine wine traders in the world. Its 440-strong member base is estimated to account for 95% of fine wine turnover globally.