Talking Trade: 29th January – 4th February

Liv-ex 50

The Liv-ex Fine Wine 50 continued to rise this week and was up 0.2% at 270.37, its highest level since July 2015. There was a good volume of trade in Bordeaux across the whole of January helping to push the Bordeaux 500 index to its highest level since April 2014 at 241.46.

Regional trade

However, Bordeaux’s market share slipped this week with Burgundy and Champagne both filling the gap with 9.6% and 9.4% of trade share respectively.

Mouton Rothschild and Haut Brion saw good activity taking 24% and 21% of First Growth market share. Lafite’s share of First Growth trade was slightly lower this week at 37%. Haut Brion 2005 (RP 100) and Mouton Rothschild 2006 (RP 96) took the third and fourth spot of overall trade by value across the exchange.

Trade by value

It was a good week for Champagne, with Bollinger Rd 2002 (AG 91) taking the top spot in terms of trade by value. Trade in Champagne was stimulated this week by the release of Krug 2002 at £950 per 6×75. It last traded at £1,100.

Lafite 2012 (RP 91) remains well represented at second place in terms of trade by value with buyers looking to purchase the cheapest physical vintage of the brand available in the market.

Trade by volume

Trade by volume saw Bordeaux’s Cote Baleau 2009 (RP 87) and Carmes Haut Brion 2009 (RP 92) take first and third place respectively, while Italy’s San Guido Guidalberto 2012 (AG 89) – the second wine of Sassicaia – took the second spot, helping to boost Italy’s share of trade by value to 5.4% this week.

Cellar Watch February 2016 Market Report released

The Cellar Watch February Market Report has been released. Containing all the latest Liv-ex research and analysis, this month’s issue includes:Fine wine market report - January 2016

  • High January – a positive start to 2016
  • Bordeaux leads indices up
  • Chart of the month: DRC:First Growths price ratio
  • Antonio Galloni on Bordeaux 2012
  • Final Thought: The price of First Growths

Please log in to the Cellar Watch website and find the full report in Market Reports under the Cellar Tools tab. Those who have not yet subscribed to Cellar Watch can view the first page of the report here.

Liv-ex 1000 Index gains 1.1% in January

Livex_1000_indices

Following gains made by the Liv-ex 100 and Liv-ex Fine Wine 50, the Liv-ex 1000 index – the broadest measure of the market- moved up 1.1% in January to close on 247.8. The Bordeaux 500 Index also edged up, moving 1.4%. Both of these indices are now at their highest levels since April 2014.

After four and a half years of decline for the region, the Bordeaux indices* led the way in January, with the most positive news coming with the performance of the Bordeaux Legends 50 Index. Composed of a selection of 50 Bordeaux wines from exceptional older vintages (from 1982), it gained 1.5%. This makes it the top-performing sub-index last month.

The Italy 100 gained 1.2% while the Rhone 100, which has been sluggish over the past two years, closed the month up 0.9%. The Champagne 50 is now the weakest sub-index over twelve months: after dipping 0.1% in January it is down 2.6% over one year.

Levels_livex1000

*Bordeaux 500 Index, Liv-ex Fine Wine 50, Bordeaux Legends 50.

Liv-ex 100 Index gains 1.1% in January

Liv-ex_100_index

The Liv-ex 100 gained 1.1% in January to close on 240.87. The Liv-ex Fine Wine 50 index also moved up, increasing by 1.7% over the month to close on 269.17. The Liv-ex 100 has a history of moving up in the first quarter only to end the year down, as was the case in 2011, 2012 and 2013. 2014 saw a reversal of this pattern while 2015 looked altogether more confused. It is therefore too early to call whether this positive movement will be sustained.

The top movers within the index are all Left Bank Bordeaux names. Pape Clement 2010, amongst the cheapest 100-point Bordeaux wines, was the top riser. Two Haut Brion vintages also feature. Three of the five steepest fallers hail from Champagne. Last year, Champagne overtook Burgundy to become the third most traded region, and the Champagne 50 index reached a new high.

impacts

Talking Trade: 22nd – 28th January

Liv-ex 50_four weeks

The Liv-ex Fine Wine 50 index rose up 0.3% this week to close at 269.7. The index continues to hold steady at the level it was at the beginning of October before it dipped 3% and hit a five-year low at the end of November last year. It currently sits just shy of its year high of 269.85.

Regional trade

It was a good week for Bordeaux with the region taking 83.9% of overall market share by value, up from the previous week and well above the average for 2015. The increase in the ‘others’ category was helped by brisk trade in Taylor 2003 (NM 95) that saw good trade at £528 per case.

Share of trade_value

Overall, trade by value was up 7.5% this week. Interestingly Bordeaux’s increased market share was not dominated by the First Growths but instead by good trade across the lower classified growths. Leoville Poyferre 2003 (Robert Parker 96), Lafite Rothschild 2012 (91) and Pichon Baron 2009 (98) took the top three spots.

Lafite 2012 has seen a good level of trade throughout the month with buyers looking to purchase the cheapest physical vintage available in the market in front of the Chinese New Year. Amongst the First Growths, it represented 47% of trade by value this week with Margaux the nearest of its peers with just 17% of First Growth trade by value.

Share of trade_volume

Lafite Rothschild, 2012: moving on up – but will it hold?

Lafite Rothschild 2012

In December, Liv-ex highlighted the demand for Lafite Rothschild, 2012. Since becoming physical, the wine has seen high levels of trading activity on the market. In spite of this, at the time of our last report prices for the wine were running almost completely flat – barely moving from a trade price of £3,000 per 12×75. With the 2012 the cheapest physical Lafite Rothschild on the market, it seemed that buyers were looking for the lowest entry point to the label.

Demand ran high through January, with the approach of Chinese New Year pushing prices up. The wine last traded for £3,200, a 7% increase on December 2015.

Whether this is a temporary Chinese New Year effect or something bigger is too early to tell. With the price of the 2012 now reaching the same level as the 2011, and the 2013 – very recently physical – hitting the market at £2,950 per 12×75, will price-driven buyers begin to turn their heads towards this younger, cheaper vintage instead?

You can view historic market data for Lafite Rothschild vintages by clicking here.


Petit Mouton – what’s moving?

second_wines_indices

As Liv-ex recently highlighted, the second wines have been outperforming the First Growths, thanks in part to their ability to offer access to these big brands at lower price points. Petit Mouton in particular showed a strong performance: in 2015 it was the biggest riser of the Bordeaux 500 index, gaining 8.3%, no doubt benefitting from ‘brand Mouton Rothschild’ – number one in the Power 100 – of which it forms a part.

The table below shows the price movements of the ten most recent physical Petit Mouton vintages. Only one of the ten declined last year, with half gaining more than 8%. There appears to be little correlation between scores and performance: the 86-point 2003, “Lacking a bit of backbone but decent enough” (Neal Martin) gained 20.6% while the 90-point (Robert Parker) 2012 ran flat. Instead buyers are seeking wines with bottle age, and prices are being driven up by scarcity: older vintages are increasing in value as the wine is being drunk.

With this pattern evident, the lower priced recent vintages might present opportunities for those looking to hold onto the wines for several years. The 2003 is priced 61% above the 2012. A sign of what is to come?

Petit_mouton_vintages

You can view more historic price data for Petit Mouton vintages on Cellar Watch by clicking here.


Bordeaux 2013: Ready to fly?

Bordeaux 2013 has begun to arrive in cellars and warehouses. The market has recently shown an appetite for strong Bordeaux brands at relatively low price points, regardless of quality: Liv-ex reported that Lafite Rothschild 2012 (RP 91) – the cheapest physical Lafite on the market – has been seeing demand, while the second wines of the First Growths have also been back in focus. If prices for 2013 are compelling compared to vintages already in the market, it will offer further opportunities for buyers looking for accessible entry points to their favourite brands.

In the table below, the current market prices of a selection of 2013 wines are compared to their respective 2011 and 2012s. The highlighted prices denote the cheapest of the three vintages.

2013 Bordeaux prices compared

Of the fourteen wines above, 2013 is the cheapest in ten instances. Haut Brion 2013 offers the greatest discount on its next cheapest recent physical vintage, available at 20.8% below the 2011. Fellow First Growths Lafite Rothschild and Mouton Rothschild 2013 also fare well, priced 17.5% and 12.1% below their next cheapest vintages.

Buyers seeking relative value in wines with some bottle age might look towards labels such as Pontet Canet 2011 and Cos d’Estournel 2011. These have already been lying in cellars for close to two years and are available at discounts to both the 2012 and 2013s.

Bordeaux 2013 prices


Cellar Watch users can follow the prices of these wines as they become physical: search for prices, or add wines that interest you to a second cellar. Not on Cellar Watch? Subscribe here.

Spotlight on … Sylvain Cathiard

Malconsorts

History

The history of Sylvain Cathiard began in the 1930s when Cathiard’s grandfather moved to Burgundy from the Savoie area of France and found work with Domaine de la Romanée Conti and Lamarche. He later purchased a small number of vineyards which were subsequently managed by his son André, who was the first of the family to bottle his own wine.

Sylvain began working for his father before taking on his own small domaine. He eventually took over the family vineyards following his father’s retirement in 1995. His own son Sebastien has since joined him, and is now making the wines.

Although based in Vosne-Romanée, Cathiard’s 5.5ha of vines also span Nuits-St-George and Chambolle-Musigny. The family’s additional small parcels include plots in Clos Vougeot and Romanée-St-Vivant.

2014 Vintage

Speaking to Allen Meadows (Burghound), Sebastian Cathiard described the 2014 campaign as “much less complicated than either 2012 or 2013 but it wasn’t without some challenges.” Yields were back to levels seen in 2009 and before, potential alcohols were good (11.8-12.8%) and skins were thick. No chemicals were used in the vineyard in 2014, and the amount of new wood and toasting of the barrels were both reduced.

Vosne-Romanée, Les Malconsorts, 2014

“In a word, brilliant”, said Allen Meadows, who awarded it 93-95 points. Neal Martin describes its “cerebral bouquet, beautifully defined”, adding that “the fruit here is very enmeshed with the oak”. He concludes: “Its persistence is awe-inspiring” and scores it 95-97.

Sylvain Cathiard, Romanée Saint Vivant, 2014

Allen Meadows describes this as “a wine of harmony and finesse that is beautifully balanced” (93-96 points), while Neal Martin observes its “dizzying, seductive intensity” and asks “One of the wines of the vintage? Most certainly. Bravo Sebastien.” (96-98 points).

Market Trends

Sylvain Cathiard’s recent secondary market performance is characterised by rapid price increases: in the 2015 Power 100, it climbed to 4th place when ranked by price performance, the highest position for a Burgundy brand.

Price history for Vosne-Romanée, Les Malconsorts, 2004 exemplifies this: it has been available in the market for just under ten years and its market price has jumped from £550 per 12×75 to £2,400: an increase of 336%. Romanée Saint Vivant, 2004 increased from £1,590 to £8,402 – up 428% – over the same period. To put this into context, the Burgundy 150 index is up 168% over ten years; the Liv-ex 100 has gained 107%.

Malconsorts_2004

The Les Malconsorts and Saint Vivant labels are the most active on the secondary market, collectively accounting for over 80% of Sylvain Cathiard trade historically. When comparing scores* against market prices, closer correlation is shown by the lower priced Les Malconsorts. As shown in the first chart, vintages with higher scores tend to demand slightly higher prices, though the 2006 and 2004 vintages do look to offer relative value.

Malconsorts

Less correlation is shown by Saint Vivant, where overall vintage quality appears to have greater impact on prices than its scores: the 2005, 2009 and 2010 vintages command significant premiums on other years.

Romanee

*Where only barrel ranges are available, the mid-point of the score is used.
Sources: www.burghound.com; www.erobertparker.com


Talking Trade 15th – 21st January

Liv-ex fine wine 50 January2016

While global markets whipsawed, the Liv-ex Fine Wine 50 held steady this week (+0.1%) and remains up 1.8% year to date. Both value and volume traded on the Exchange increased, and Bordeaux’s trade share crept up towards 80% after dipping last week.

Regional share of trade by value

100-point (Robert Parker) Montrose 2009 was the most traded wine by value, with activity stimulated by an ex-Chateau release of the wine mid-week. It was offered by negociants at €240 per bottle but last traded on the Exchange for £1,830 per 12×75. This is equivalent to €201 per bottle, a 16.3% discount. This follows the ex-Chateau release of Pontet Canet 2006 in early January which similarly resulted in increased activity for the wine.

Top 5 wines traded by value this week

Italy saw another strong week, boosted by trade for Ornellaia 2010 (97 points, Antonio Galloni) and San Guido, Guidalberto 2012 (89 points). Popular brand Domaine Chevalier was also amongst high volume traders, seeing activity for its 93-point (Parker) 2008 vintage.

Top 5 wines traded by volume this week