The Wine Cellar Blog» economic crisis

Chateau Lafite-Rothschild is a Mountain of Gold

admin — Tue, 29 Sep 2009 04:56:52 +0000

I don't know if they still do, but at one time the Chinese called America Gum Shan, the mountain of gold, a symbol of opportunity and the chance to get rich. Today, the Chinese have found another symbol of opportunity whose very name beckons the ambitious. In French Lafite means small hill, in Chinese it is very similar to the word lai-fat or "come get rich." It is this association with wealth and opportunity that has made Chateau Lafite-Rothschild and it's second wine Carruades de Lafite the currency of choice for negotiating Chinese business deals. Which bottle you get depends on who you are and what is "requested". In China, anything with Lafite in the name sells be it Bordeaux or Burgundy. As such, both wines are becoming literal mountains of gold for owners of bordeaux futures. Chateau Lafite and its second wine, Carruades de Lafite, continue to defy the fine wine market, with prices of both continuing to rise week on week. Lafite 2008 is currently trading at around $6,000 per case, rising in price by around $140 per week, even though it is not due to be bottled until next year. Margaux 2008, in contrast, is trading at just over $3200. Carruades 2008 is still at around $1600, but it is predicted to keep climbing closer to the other first growths once in bottle. Gary Boom, managing director of the Bordeaux Index, told decanter.com, 'Today a case of Carruades 2004 would set you back $2900, which is considerably more than the $2600 you would pay for a case of Mouton 2004. The September Liv-ex report also looks at the phenomenon of the "seemingly unstoppable Brand Lafite", reporting that Carraudes has bucked the trend of price drops during the financial crisis, and that on average, recent vintages are now 22% more expensive than they were at the peak of the market in June last year. "Asia has made up its mind on this brand," said Boom, "and completely ignores either vintage effect, or Parker scores."

This is a post from: The Wine Cellar Blog

Wine 2008: Black Blue and Green All Over

admin — Tue, 19 May 2009 03:26:21 +0000

The wine industry was battered and bruised in 2008, the astronomical prices for top-level wines plunged, and as if in an act of repentance more winemakers went green. For example, Boisset, the second-largest producer of Beaujolais Nouveau, bottled its entire 2008 harvest in lightweight plastic bottles. Biodynamic and organic wines increased. Yet many still doubt the wine industry's sincerity when it comes to carbon neutrality because they still ship wine in wooden crates as opposed to the much lighter corrugated cardboard. The Liv-Ex 100 Fine Wine Index, the wine world's Dow Jones Index, has fallen more than 20 percent from its all-time high. Among the hardest hit was Domaine Romanee Conti 1990, which commanded more than $20,000 a bottle in November 2007, but sold last fall for $6,500 - a 67.5 percent drop. The global credit crisis has threatened Bordeaux's en primeur sales. And as wine buyers search for bargain-priced bottles, Bacchus seems to be favoring Chile and Argentina.

This is a post from: The Wine Cellar Blog

Winemaking Facility Offers Wine Buyers “Bailout”

admin — Tue, 19 May 2009 03:18:17 +0000

A San Francisco cooperative is selling futures in a new wine called "Bailout," inspired by the economic crisis. Crushpad, a custom crush facility, will sell the Napa Valley Cabernet Sauvignon at $39 per bottle. But there's a twist, for every 100-point drop in the Dow Jones from the date of purchase to the projected bottling date of 14 August 2009, the final price will be discounted $2 per bottle. If the Dow is higher on the bottling date, the price is still $39 a bottle, making Bailout futures a minor hedge on the economy. Only 500 cases will be produced. Crushpad is doing this for fun and exposure, but it may be instructive for high-end Bordeaux winemakers who refuse to lower their exorbitant 2008 futures prices given the current environment. According to those in the wine trade, Bordeaux must lower it's prices by 50% or the 2008 en primeur campaign could be a disaster. Crushpad is an urban winemaking facility that enables budding entrepreneurs to make their own wine with the expert help of the staff.

This is a post from: The Wine Cellar Blog