Lafite underperforms at HK auction

A collection of Lafite spanning 1981 to 2005 sold for HK$4.2 million (£336,000) at a Christie's auction in Hong Kong on Saturday. Despite setting a new world record - the most expensive wine lot ever sold at auction - the collection failed to match its pre-sale high estimate of HK$4.5 million. 

Overall, the two-day sale was a success, raising £4.7 million against a pre-sale estimate of £3.7 million. More than 570 lots went under the hammer, including those featuring the top names from Bordeaux, Burgundy and Champagne. Bidders' enthusiasm for Lafite, however, was somewhat tepid. This is particularly interesting in light of the First Growth's recent descent. (Read more here.)

Lafite's relatively lacklustre performance can be seen from the table below, which compares the Liv-ex Mid Price to Lafite hammer prices. Please note that the Liv-ex Mid Price is a trade-to-trade price and does not include merchant margins. It represents the price merchants could expect to achieve when selling wine on the secondary market. (End-consumers could expect to pay 10 to 25 per cent more.) Because we are approaching the auction results from a seller's perspective, and the buyer's premium does not go to the vendor, we have used hammer prices for our analysis.

As you can see from the table below, all of the vintages sold at a discount to the Liv-ex Mid Price.

 
Prices for 12x75cl cases. Hammer prices based on a buyer's premium of 20 per cent (though this can be higher).

Comments

[Liv-ex]

Hi Scott

Sorry you feel that this data has been misrepresented. If we compare the highest prices that recent vintages of Lafite fetched at auction in Hong Kong in Sept 2010 with those seen in Hong Kong this month (for the same vintages of course), last year's prices were an average of ten per cent higher. According to Liv-ex trading prices, vintages 1999-2008 have actually increased in value by seven per cent year on year. This further underscores Lafite's poor performance in Hong Kong.

Nonetheless, this blog post was actually comparing hammer prices (excluding buyer’s premium) to current secondary market trading prices - in other words, the prices merchants could achieve by selling Lafite at auction in Hong Kong compared to those they could achieve in business-to-business transactions. As you can see, this month’s auction prices were significantly lower.

[Scott]

LiveEX as the "supposedly" preeminent authority on price structures in the wine industry you have a duty to explain you numbers. I am blown away at how poorly you have written this article and how the information is improperly represented. You offer a "scarey" headline for your newsletter list. Why did you not mention that the high estimates for these wines were raised by 10% year over year by the auction houses. Lafite did not under preform..when you look at the information in a number to number comparison. Lafite preformed better than last year.

For christ's sake...your luck that most people who read your blog are pickled and can't do basic research and math