First Growth 05s approach five year lows

As we reported in the November
Cellar Watch Market Report
, the last ten vintages of the First Growths have
fallen drastically in price since their peaks, with an average drop of 33.9%. Notably,
the data showed that the 2005 differed from other vintages in that prices for
the wines tended to peak in mid-2008 (as shown in the chart for Margaux, below)
rather than 2011, when the majority reached their highpoints.  

There was trade on Liv-ex today for Mouton Rothschild (LWIN 10135442005),
Lafite Rothschild (LWIN 10118722005) and Margaux 2005 (LWIN 10127812005) as buyers honed in on a vintage where prices
are reaching new lows. Margaux’s trajectory, below, shows how prices rocketed
in early 2008 as the trade awaited Parker’s in-bottle scores for what was
deemed an excellent vintage. When only two wines were awarded 100 points the
prices fell again, only to rise back up with the rest of the market in 2011.   


Since then, prices for the 2005 vintage have been steadily
falling. They are currently at the lowest they have been in five years for Haut
Brion, Margaux and Mouton Rothschild; the lowest in four years for Latour; and
the lowest in almost three years for Lafite Rothschild.



Moreover, many of the wines are nearing their London release
prices. Mouton 2005 traded on Liv-ex today for £3,600 per 12×75: just £100 more
than its price from 2006. The table above reflects the full spectrum. With
prices still falling, it remains to be seen whether the 2005 First Growths will
drop right back to their Ex-London prices, or stabilise before then.  

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