any bets on 09 prices?

rjsussex · Post by **rjsussex** » Wed Apr 07, 2010 11:54 am

One UK merchant has just told me he's expecting the firsts to be between £6000-£8000 in bond because of Asian blank cheques, and something like Poyferre to be about £590 in bond, the latter being the 05 opening price with the much weaker UK pound factored in.

Thanks, no thanks.

He also says, as other UK merchants have already said, that there are some disastrously over-extracted left-bankers in 09 (including Cos - as Alex reported) and that quality is therefore less uniform than 05.

Richard

Comte Flaneur · Post by **Comte Flaneur** » Wed Apr 07, 2010 1:39 pm

The combination of weak currencies (for US dollar and sterling based buyers) and a super-hyped trophy vintage is deadly; add into the mix the rocket fuel of the unintended consequences of central bank money printing, which flooding the world - and particularly places like China - with liquidity, as China imports inappropriately loose monetary policy by fixing its currency at an artificially lower level...and I just ain't f**king interested...one thing we know for sure: it will be very silly and they can stick their prices and their 09s up where the sun don't shine.

Of more academic interest to me is whether the 09s will drag up the overall level of prices of investment grade bordeaux like the 05s did, where the 05 prices initially seemed anomalous and ridiculous.

JonB · Post by **JonB** » Wed Apr 07, 2010 3:29 pm

Here's a fairly balanced view: http://www.thewinedoctor.com/author/bor ... aste.shtml

The hype machine is running overtime this year. The early producer reports were it was a cross between '03 and '05. Then '89. Then '82. Then '47. Now there is no parallel to this greatest vintage ever.

I think it is very hard to predict what will come out....but it seems in all likelihood in general they'll try to keep '05 pricing or higher. It sounds like the type of vintage RP will extol; high alcohol, concentration, power, ripe fruit.

I'm more looking forward to the UGC tastings here for the '08 wines in bottle in a year, as I think this vintage will be overshadowed by the '09s, and the '08s will remain a relative bargain.

DavidG · Post by **DavidG** » Thu Apr 08, 2010 8:05 pm

My guess: $600/btl for first growths for the first tranche with very limited availability at that price,then up to $700/btl for the "first and a half" tranche as soon as that first tiny tranche is spoken for.

JonoB · Post by **JonoB** » Sat Apr 10, 2010 4:32 pm

Prices will undoubtedly be high... very high! Well it is the greatest vintage since sliced bread!!!!!!!!!!!!!!

DavidG · Post by **DavidG** » Sat Apr 10, 2010 8:16 pm

Heck, it's the greatest vintage since bread, period!

Comte Flaneur · Post by **Comte Flaneur** » Sat Apr 10, 2010 8:22 pm

Jono and I - hopefully - will be tasting a barrel sample of the 09 La Conseillante on Tuesday night (together with 15 other vintages of the estate with the classiest label on the planet)...we might even be tasting a few more 09s on Thursday night.

DavidG · Post by **DavidG** » Tue Apr 20, 2010 5:00 pm

Here's Parker's guess:

My two cents,and predictions....although Gil has it about right...the first growths will come out in mid-late May...tiny premier tranche(release)at 2005 opening prices...then the world market will panic(falsely) because they perceive wine shortages as the Bordelais masterfully manipulate the market....second tranche prices and subsequent ones will set all-time records(futures buyers of 2005 will look very astute,geezers like me with lots of 03 Medocs, 00s,98 right bankers,96 Medocs,90s,and 82s will need to dramatically increase our insurance as our net worth soars))....expect 2009 Lafite at 1,000 euros by September----regardless of what I say about it..these are luxury brands today...the Chinese have preordered 3X the total quantity of first growths produced...not kidding about this...forget the firsts unless you are a partner in Goldman Sachs....the real danger is the other top 200-250 chateaux in Bordeaux pegging their prices proportionately to what the firsts demand..and all the complaining on this BB or any other one won't make one difference in the world....limited production wines from top vintages...whether it be Burgundy or Bordeaux, have more and more admirers while the quantity is finite...and there is no reason to cry about it...so much great wine in the world from less prestigious regions with dramatically fewer chasers...if you don't take advantage of that....shame on you

JonB · Post by **JonB** » Tue Apr 20, 2010 8:08 pm

Here is an excerpt from the e-letter he sent out about 2 weeks ago:

1. 2009 is an incredibly exciting vintage of opulence, power, and richness, yet the better wines have a precision and delicacy that is unprecedented. There will be worldwide demand - that is assured. Many people have said, "Well, the Asians don't buy Bordeaux wine futures," but of course, the Americans didn't either 30 years ago, and when I was in Bordeaux recently, the place was overrun by Asian wine buyers giving out lists of preferred wines to all the leading négociants. In short, they are going to buy in 2009. In fact, they already started buying in 2008, so we have a new factor, and a major one at that. The questions that will be answered in May and June are (1) Will the Asians buy more than the first growths? and (2) How much wine in total will they purchase? Luckily, the American dollar has increased rather dramatically in value against the euro, and if that continues, we could have the scenario that unfolded both in 1991, when Americans could purchase 1990s with a strong dollar, and in 1983, when Americans first jumped big-time into buying Bordeaux wine futures to buy the 1982s with a strong dollar.

However, finding value in 2009 will be the challenge. Forget the first growths or the super seconds. The prices for these wines, I fear, are going to return to the 2005 levels, which were absurd. But this is the new reality. Like Lamborginis, Porsches, haute couture houses such as Chanel, or top-level watch companies like Berguet, International Watch Company, or Roger Dubuis, today's top 24 Bordeaux châteaux are exquisite brands of status and prestige. That, unfortunately, is not going to change, even with a global economy struggling to rebound. There is just not much of these wines made. The 15,000-20,000 case production may sound like a lot of wine for one market or two, but spread it around the world to every civilized city, luxury restaurant, and hotel, and the supply quickly evaporates. However, there are hundreds of Bordeaux châteaux today releasing beautiful wines, and this was not the case 20 or 30 years ago. These are the value wines, and although many include some of the lesser known classified growths, the others emerge from backwater appellations lacking the prestige to fetch high prices. This is where wine drinkers should be focusing their energy.

2. The vintage that was underpriced by the Bordelais, after foolishly overpricing the far inferior vintage of 2007, are the 2008s. This is a classic vintage, with some very strong wines, particularly from the top properties in the Médoc and on the Right Bank of Pomerol and St.-Emilion. There actually may be some Pomerols and St.Emilions that eclipse what those châteaux did in 2009. This is still a reasonably priced vintage, but the problem is that it is a very tiny crop, much smaller than either 2009 or 2007 (which, of course, accounts for the impressive concentration the best wines have), but they still represent a bargain. And given what will be the enormous hype machine buttressing the 2009 campaign, 2008 is a vintage that smart money will seek out.

Houndsong · Post by **Houndsong** » Tue Apr 20, 2010 9:19 pm

So a world economy in tatters makes not a dent in Bdx pricing. Whatever happened to the Bdx bubble? It is impregnable, an iron clad leviathon that just cruises higher, and higher, and higher ...

Blanquito · Post by **Blanquito** » Tue Apr 20, 2010 9:39 pm

Suddenly those of us who went long on 2005 Bordeaux (or in my case, silly long) are looking "very astute"? When these wines are frequently still available at or near release price (excluding the handful of outliers, like the 97-pointer Malescot St. Exupery)?

DavidG · Post by **DavidG** » Tue Apr 20, 2010 9:46 pm

There is a lot to suggest a bubble economy in Bdx in Parker's analysis. Ben Giliberti, the Baltimore Sun wine writer, believes this to be the case, and feels it is absolute foolishness to buy into the fantasy that the '09 Bdx will be worth the astronomical prices some are predicting.

I just got my first e-mail offer from Calvert-Woodley for '09 futures, on Ch. Clarke (Listrac) @ $255/case, Cote Montpezat (Cotes de Castillon) @ $186/case, d'Aurilhac (Haut-Medoc) @ $180/case, Lanessan (Haut-Medoc) @ $204/case, and Lilian Ladouys (St Estephe) @ $231/case. No idea how these compare to the initial prices for '05s-'08s, or even if knowing that would be in any way predictive of what the bigger boys and first growths will come out at.

I don't really need any more Bdx at this point, and am highly likely to watch from the sidelines as an amused observer as the '09 prices roll out, as I did for '06-'08.

DavidG · Post by **DavidG** » Tue Apr 20, 2010 9:50 pm

Patrick, I agree that those who bought '05 futures are more or less treading water, at least on average. The way I read the "very astute" comment was that it was based on his prediction that high '09 prices will bring up the value of the '05s and all other prior great vintages. That's no guarantee. Time will tell.

JonoB · Post by **JonoB** » Wed Apr 21, 2010 1:04 am

For what it is worth, I think the prices of 09 will be inflated simply based on the hype of the growing season... yes, these are nice wines now (in the case of the big boys, and I have had a lot of variation and I don't believe that PArker will like some of his old favourite chateaus this time round), they always are and EP scores tend to be based on structure and not whether the wine is unforgettable... it is a bit like trying an utterly closed wine and giving it 100+ points. HOw will these wines age...we can guess but nobody thought that 98s and some 97s from the right bank would be great sleepers. Those are wines were value can be had. Even buying 89s look good value!

Anyway, prices will be high, and some people will buy. I don't believe the ASIA hype (those guys are merchants most ex-Brits in Hong Kong or Enoteca in Japan [i.e the old guard who'd buy anyway]) once the wines land, they will sell these wines by the bottle when infantile to people who know nothing about wine! (which is one of the reasons I do the job I do, to educate those who drink in Asia!). Which is why people are so amazed by 'SEMI'-mature wines I send them!

Most of the demand for these wines is from speculators speculating against each other on whether the Chinese will buy LAfite and what knock on affect that will have.

There is a lot of dross in 09, which there wasn't in 05. It is a vintage where you should try the wines (if possible) read critics 'notes and not their scores' and buy based on whether articulates into value for money.

For modern vintages to cellar for pleasurable and good value drinking? 01 Right Banks that have high Cabernet Franc; 02s from St. Julien; 04s from Pauillac; Left Bank 06s and some 06 Right Banks that have distinctive vineyard characteristics and 08s that released their allocations before PArker gave them their scores.

Best
Jono

JonB · Post by **JonB** » Wed Apr 21, 2010 6:12 pm

the Chinese have preordered 3X the total quantity of first growths produced...not kidding about this...forget the firsts unless you are a partner in Goldman Sachs....the real danger is the other top 200-250 chateaux in Bordeaux pegging their prices proportionately to what the firsts demand..and all the complaining on this BB or any other one won't make one difference in the world...

Maybe someone can help me with interpreting Parker's statements? What is a pre-order? If it is a firm commitment at any price? Is he saying there will be no first growths for sale other than in China? Do you think Parker verified this (e.g. did he look at the contracts), or it just hearsay? Or could he mean that the total Chinese pre-order quantity for all Bordeaux wines is 3 times the production quantity of first growths (e.g. 240,000 bottles)?

If he is the greatest wine authority in the world, I hope his tasting notes are more factual, informative, and clear?

JonoB · Post by **JonoB** » Wed Apr 21, 2010 6:44 pm

I think it is speculation... Jancis Robinson mentioned on Twitter that she was baffled by all the talk of Asian buyers, as she bumped into nobody.

smells of trying to douse the flames with water and failing.

The Chinese want wines in bottle... I think he means that they are willing to purchase three times more LAfite than is produced, but that won't necessarily translate across the board. I don't think they will have signed contracts any price...
merchants in ASIA are very savvy and will make higher profits than their more trad. US and UK equivalents.

...having said that I have had emails asking for stupid numbers of bottles of any vintage of LAfite from Chinese people.
2000-3000 is about average. Most are very dodgy. I think the majority of EP will be sold to the UK and USA who are hyping this, and through satellite offices in Hong Kong and through Enoteca.

In Japan people don't realise they can phone London and buy, they think they have to buy through Enoteca to get EP. Enoteca will have traditional allocations, and China will have little. I do think that once on the market, the Chinese will buy what is available when bottled.

DavidG · Post by **DavidG** » Thu Apr 22, 2010 1:05 am

I agree with Jono - probably speculation too. I doubt that RP has seen confirmed sales contracts. He's probably heard from sources he trusts that there are "pre-orders" for 3x the first growths. Whatever "pre-orders" means - quite possibly no more than an expressed desire to purchase x amount when it is available. It does sound like he's talking about all the firsts, not just Lafite, but who knows? This is all just rumor and speculation at this point anyway.

I'm continuing to hear that '09 quality is very non-uniform. Really high highs, but also plenty of wines that aren't close to "vintage of the whatever." Unlike '05, where the rising tide lifted all boats. So for those who do want to purchase '09s, it will be important to be selective.

Houndsong · Post by **Houndsong** » Thu Apr 22, 2010 2:21 pm

I'm hoping financial reform includes strong measures on Bordeaux "pre-orders". We need transparency, open order books, and above all measures to prohibit speculation not linked to bona fide hedging activities.

JonB · Post by **JonB** » Thu Apr 22, 2010 2:56 pm

Hound - maybe RP's comments mean Goldman Sachs has taken a position in Bordeaux futures?

The meaning of the Asia issue is somewhat lost on me. Maybe it is to try to goose en primeur sales by creating an impression of excess demand compared to supply? Seems like a form of hucksterism.......like Christian Mouiex's comments to Tanzer that "95% of top wines will be sold to Asia."

JonoB · Post by **JonoB** » Thu Apr 22, 2010 3:35 pm

JonB wrote: Seems like a form of hucksterism.......like Christian Mouiex's comments to Tanzer that "95% of top wines will be sold to Asia."

More like 95% of LAfite will be sold to China through other channels after bottling!

DavidG · Post by **DavidG** » Thu Apr 22, 2010 7:03 pm

Ah, but how much of the Lafite sold to China will actually be real Lafite? Maybe some creative entrepreneurs will be able to satisfy that demand for 3x the total production of first growths.

Here's my litmus test question for any new financial regulations: If I mortgage the house to buy '09 first growths, then default on the loan, will the govt bail me out at taxpayer expense?

jal · Post by **jal** » Thu Apr 22, 2010 7:38 pm

DavidG wrote: Here's my litmus test question for any new financial regulations: If I mortgage the house to buy '09 first growths, then default on the loan, will the govt bail me out at taxpayer expense?

Free wine?????

DavidG · Post by **DavidG** » Fri Apr 23, 2010 3:08 pm

Jacques, was I that transparent? I guess I need to create a market for some derivatives first if I want this to fly. Maybe some CWOs and WDSs - collateralized wine obligations and wine default swaps. Something complicated enough that no one will pick up on the "free wine" aspect until the bottles are resting comfortably in my cellar. That sounds too complicated and like too much work, though, so forget about the "free" concept. Guess that's why, to borrow a phrase from Jim, "I'm just a simple country doctor" and not a Wall Street wizard...

And why I will likely sit out the 2009 futures campaign.

Houndsong · Post by **Houndsong** » Fri Apr 23, 2010 5:10 pm

Isn't there already a bordeaux index on some London exchange? With 3x bid to cover for Lafite just from China I do think it is time for some synthetic BDX cdos. You've got your firsts (super-senior), mezz tranche (mainly other classed gorwths plus some unclassed parker faves) and your subprime (cur bourgeois). After all the whole virtue of derivatives that are merely directional bets and not true hedges is the liquidity they provide to the markets.

DavidG · Post by **DavidG** » Fri Apr 23, 2010 9:32 pm

Would the "cur bourgeois" be the dogs in this hierarchy?

Houndsong · Post by **Houndsong** » Sat Apr 24, 2010 1:55 am

A freudian slip. I have a new coonhound flying in from Houston in the morning. We've gotten 18 inches of snow so far today. Springtime in the Rockies.

JonoB · Post by **JonoB** » Sat Apr 24, 2010 2:04 pm

Just tasted another 30 odd barrel samples of 09s...

La Conseillante is delightful; closely followed by Langoa Barton and Batailley from this set of thirty... no big boys!
some nice Pomerol, left bank far more consistent.

Sauternes, and Barsac... are just beautiful from top to bottom, but all in very different styles. Even the cheapies were tasty as hell!

Unfortunately, how will they age? will they get too much oak? The prices are going to be high... La Conseillante at North of £1000 before taxes? Most probably, but not for me at that price! Batailley @ over £400... based on the quality... just about but its a lot for Batailley!

rjsussex · Post by **rjsussex** » Sat Apr 24, 2010 8:13 pm

Prices are already lunatic in UK and the campaign has hardly started: Haut Marbuzet £330 in bond! Certain words of John McEnroe come to mind.

Richard

JimHow · Post by **JimHow** » Sat Apr 24, 2010 8:20 pm

Lol, Richard.
Crazy.

JonoB · Post by **JonoB** » Tue Apr 27, 2010 2:27 pm

rjsussex wrote:Prices are already lunatic in UK and the campaign has hardly started: Haut Marbuzet £330 in bond! Certain words of John McEnroe come to mind.

Richard

The big boys who really define the market haven't released. Its the lower wines on the whole that won't get scored by bob and if they do they will be low who have released at higher prices than last year, other than one noted difference.

It looks like it is going to be a long drawn out campaign this year, with a lot of speculation and twiddling of fingures.

Tim Atkins MW has just posted a very good rreport of the vintage on his website, which I recommend quite highly.

rjsussex · Post by **rjsussex** » Fri Apr 30, 2010 10:46 am

Haut Condissas £295 in bond any one??? With its rival in overoaked nastiness Haut Marbuzet at £330 in bond, how can any self-respecting but junior classed-growth come out at less than £350?

Richard

JonoB · Post by **JonoB** » Sat May 01, 2010 6:46 am

Richard,
Any Chateau that still wants to be respected by their regular drinking community!
Still I have my doubts, still the most expensive price I have found for Doisy-Daene which I thought was fantastically good is 310 STG, so hopefully I can source it cheaper for my own drinking, which was refreshing, especially having got such a good score from a critic who I respect and have discussed great wines with in the past!

I am probably breaking the rules, but I've just posted more notes of 09s that I have tasted on my blog, although I will happily receive a slapped wrist if posting this sentance is against the rules. Feel free to edit as is necessary @JimHow and Co.

Best
Jono

JimHow · Post by **JimHow** » Sat May 01, 2010 10:46 am

No problem, Jono, I'm not uptight about such things. We appreciate your lively input here, I enjoy reading your comments.

JonoB · Post by **JonoB** » Sat May 01, 2010 12:01 pm

That's a relief!
I certainly like to push the boat out a bit!

DavidG · Post by **DavidG** » Thu Jun 17, 2010 5:18 pm

First sniff of First Growth pricing here (http://www.decanter.com/specials/297597.html) with Lafite at 450 Euro (~$550), below my prediction of $600-700. But this is "ex-Chateau." By the time it gets to the consumer that number is going to be a good bit higher.

DavidG · Post by **DavidG** » Fri Jun 18, 2010 12:07 pm

Lafite after the negociants take their cut is at 550 Euro, or ~$680/bottle. Oh well, someone will buy it.

JimHow · Post by **JimHow** » Fri Jun 18, 2010 12:59 pm

I'll be curious to see the extent to which 2008 Lafite is available stateside, and what the price will be. 2008 Mouton looks like it is going to be available at or under $250. I might buy a bottle at that price.

DavidG · Post by **DavidG** » Fri Jun 18, 2010 2:15 pm

'08 Lafite looks like $580-700/btl. '08 Mouton $250-400/btl

JonB · Post by **JonB** » Fri Jun 18, 2010 3:21 pm

After this first initial rush of sales, my guess it will be a long 2 years with few sales until RP's next review, assuming he adheres to the 2 year review cycle implemented post-2005 vintage (as both Suckling and Tanzer did also). While 2009 en primeur pricing was higher dramatically over 2005's, 2005s continued to go up in price with RP's next review, and then again with his final review, and only falling with the economic crisis. It is very unlikely 2009s while have the same trajectory.

I bought '09 Pavie Macquin

, perhaps should have waited on this purchase for 2 or 3 years......but am not planning to buy anything more now.

DavidG · Post by **DavidG** » Fri Jun 18, 2010 4:51 pm

Lafite now at 760 Euro ($940) to retailers after importers and distributors take their cut. Can't wait to see what they'll be asking us li'l ole consumers to pony up. Wine Searcher shows one place in SF offering it at $1400.

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