Well! all that has now changed. Asia has now become the epicentre of the world’s fine wine market. It has not taken long. In February 2008 the Hong Kong Government in an attempt to stimulate growth and make southern China a fine wine hub, slashed their wine duty to zero. As a result the Hong Kong fine wine salerooms now handle more wine than is auctioned in any other part of the world. Many of our London based merchants now have offices in Hong Kong. Or soon perhaps the other way around.

The wines from this hub now find their way to other parts of Asia, principally the Chinese mainland but also to Indonesia, Singapore, Taiwan, South Korea and Macau. Unfortunately some of these countries have punitive ad valorem taxes. Entrepreneurs have developed businesses specifically to minimise these high duty rates when importing from Hong Kong. Chinese regulations permit the hand carrying of bottles into their country. Creative businesses are running teams of wine mules, comparable to the white vans that used to be prevalent when “personal allowances” were all the rage.

Shortly hundreds of fine wine traders will be making their way to the Hong Kong Vinexpo, the equivalent of the Bordeaux biennial wine fair. In the past the Bordelais have postponed the releases of their en-primeurs to coincide with the fair scheduled for the end of May. However this year they have wisely decided given the quality of the vintage and the anxiety of the fine wine trade to see the prices reduced from the haughty 2010 levels to release the en-primeurs wines before the Hong Kong Vinexpo.

According to estimates there are between 5000 and 10000 customers in China willing and able to buy first –growth Bordeaux’s costing thousands of pounds per dozen, far more than in economically challenged traditional markets. The Chinese media is now a creative medium for wine advertising and other symbols of sophistication alongside luxury labels. Chinese appear to have become more interested in the less expensive mid-range Bordeaux wines  between £300 to £500 as wine consumption continues to gather pace.

Hong Kong aside other Asian countries have long histories of fine wine interest. Japan which was the first country to show any real interest in importing the top wines is still very much a market despite the economic climate. The Singapore market is becoming more active.  Restaurants now have wine businesses selling directly to the public and with the opening of two super casinos. It is hoped that the punters will be wealthy enough to absorb the higher prices of the burgundy grand cru and the first growths.  Interestingly enough that given the sultry climate of Singapore many of the drinkers are moving to red Burgundy and Pinot Noir, along with Sauvignon Blanc and the refreshing Riesling.

Another Asian country that has a great growth potential for fine wine is Indonesia, with a climate similar to Singapore. Duties are exorbitantly high therefore creating challenges for the most inventive of wine importers.

Vietnam has close connections with France. In the 19^th century they introduced grape growing. However their market now consists of home grown grapes and bulk imports.

Thailand has worked hard to develop local vineyards and wine-making expertise, with tax breaks over imported wines they have fashioned an advantage over cheaper imports from Australia and the like.

India has her own indigenous wine industry, unfortunately duties are punitive and there are very distinctive drinking habits. Importers have found it hard to make inroads into this market whether wine accompanies food or not. The Indians have a tradition of drinking long and hard. Wine is associated with status. Guests will check the price of wines served at dinner along with scores and rate their importance accordingly. Wine and face are interconnected.

The Asian market presents many opportunities for the world’s wine exporters, not only at the top end.  It also encourages illegally the passing of off fakes, everything from Chateau Petroos to well priced counterfeits.

Currently the principal interest has been in claret however they understand that further growth will be gained in both the sweeter red and white wines. Additionally, they understand that markets will grow away from the major cities such as Beijing-Shanghai and Guangzhou to other smaller cities.

In the south of the country where the cuisine is lighter and seafood orientated then white wine consumption will grow more rapidly.

Jenny Li, Research Manager at Wine Intelligence  is reported as saying “It’s probably fair to say that we are reaching the end of the first stage of China’s wine market evolution. As we progress towards a more mature marketplace, we will see the consumer demand shift from the professional gifting occasion towards purchasing from home consumption.”

“Overall this is a positive move for the market, and will give Chinese consumers more reasons and occasions to shop the category. However it will also create complexity in the market, and will challenge the resources of the retailers, distributors and band owners alike.”

The estate's managing director and winemaker, Paul Pontallier, claimed that organic farming was the future direction for Margaux. ‘We are very close to organic farming. I think it’s a matter of a couple of years,’ he said at a London seminar.

Pontallier presented 16 wines at the event, including wines produced using alternative farming methods.

The organic and biodynamic examples rated more highly than those conventionally farmed among trade members.

Margaux also unveiled its experiments with alternative wine closures on the estate's second wine, Pavillon Rouge.

‘We’ve all been disappointed and frustrated by corked bottles. Another closure would be welcome if it is better,' he said.

While trials on synthetic corks were ‘absolutely catastrophic,' screwcaps fared better.

A 2003 red wine sealed with an impermeable screwcap closure was preferred to the same wine sealed with a cork or a permeable screwcap at yesterday’s event. Pontallier revealed that this was consistent with tests at the estate.

'If we have consistent proof that it works better, I don’t see how we could resist,' said Pontallier on moving to screwcaps.

The same test on a 2004 white wine from the property drew a less conclusive result from both the audience and Pontallier, who preferred natural cork.

‘It’s very difficult to draw conclusions and every time we do these experiments, we don’t agree. Or if we agree it’s on things we don’t expect to agree on,’ he added.

Article reproduced from Decanter Wine Magazine

The report blamed much of the recent price drops on the ‘trauma’ inflicted by the high prices of last year's Bordeaux en primeur campaign, which in some cases were 40% higher than already-expensive wines of 2009.

Respondents unanimously demanded a price drop for the 2011 vintage. Europeans suggested a reduction of ‘at least’ 20%, while Asian respondents suggested 10%.

One wine merchant in Malaysia said, ‘If (the Bordeaux vintage) is overpriced again this year, I don’t think there will be any gains (in Asia).’

Overall, 70% of respondents expressed doubt over the value offered by en primeur as a purchasing method, and 50% felt the 2010 campaign damaged consumer sentiment towards Bordeaux.

Despite these doubts, Wine Yield publisher Jackson Taylor told Decanter.com, Bordeaux is still the first choice for investors and collectors.

‘For all the controversy - which many in the trade agree has damaged Bordeaux - it still turns up in question after question as the strongest pick for the collectible wine market.’

He added, ‘but sectors of support are wavering, and Bordeaux 2011 needs to be handled carefully.’

The Fine Wine Market Outlook 2012 is a joint report, issued in English and Chinese, by analysts Wealthmonitor and online magazine Wine Yields.

Progressive producers are endorsing the latest technologies of both viticulture and vinifaction to produce outstanding wines.

I recently read an article by Andrew Jefford in December’s Decanter where he extols the virtues of Chateau Unangs’ proprietor  James King, an Englishman who now orchestrates one of the best Rhone Valley wines from the unfashionable appellations called Cotes de Ventoux. I contacted James and asked if he would be kind enough to let me have some samples. The whites are not ready until the Spring of 2012 he explained. However he obliged with several samples. Yes I really do this for a living. The Chateau La Croix 2009, Mr Jefford tasted the 2006 in magnums was frankly one of the greatest wines I have ever tasted. I am serious when I say that. Full of fruit, powerful and yet with a remarkable natural sweetness.  I am told that this comes as a result of low yields, rigorous berry selection, long fermentation of up to 3 weeks which gives far more structure to support the fruit.

When you consider the prices being charged in the more famous appellations of the Rhone, Bordeaux and Burgundy then James King’s Chateau Unang is a revelation to behold.

Please click here to see the extensive tasting notes.

Yes I cannot deny that wines I previously enjoyed I am less able to do so. Wines such as Leoville Barton, Duhart Milon, Grand Puy Lacoste, Lynch Bages etc unfortunately have become prohibitively expensive for my ever thinning pocket. However the choice and quality of wines under £20 is quite superb. The quality has enjoyed a significant uplift at the same time as their more expensive cousins have increased their prices.

You only have to see what is being produced in the less well know appellations of St Estephe, Moulis and  the satellites of St Emilion and Pomerol to realise what great strides are being made.  Rather than being lazy searching out new wines is one of the great pleasures and finding a gem is so very rewarding.

For example Chateau Greysac 2009 is a stunning wine packed but of cassis and raspberries. Ok it is not from a fashionable appellation but it represents terrific value for money.

Whilst I am on the subject of Bordeaux can I encourage that the chateaux  pitch their Bordeaux 2011 en-primeur prices at the drinkers rather than the investors. What with fine wine prices having fallen by as much as 45%, the bubble has been well and truly pricked for the time being. Lafite has been one of the primary casualties. From what I understand 2011 will not be a great vintage and therefore I suspect there will be little appetite if the prices are not corrected.

The wines have plenty of fruit, fresh, fine aromas, supple tannins, energy and extract. I would advise caution as it does not have the consistency of the 2009. You need to know your grower. The less able produced wines with unripe tannins, excess acidity and lacking in concentration. It is a vintage whereby the good wine-makers earned their money.

Click here to visit our Burgundy 2010 page. 

During the last 12 months the fine wine market as a whole is down just over 20% while some wines have dropped 45%. The First Growths have suffered most falling 26%. Clearly nothing can continue to go up continuously. The market is purging itself and soon will it be a time to buy?

Will wine prices continue to fall? Considering the demand has arisen from Hong Kong with import duty down to 0% previously 80% a huge amount of wine has been imported, you only have to evidence the fine wine auctioneers setting up camp in HK. Wine is now becoming more fashionable in the Chinese mainland with it appearing in restaurants and board-rooms. I feel confident that the appetite will continue to grow.

Should I now consider drinking my wines? Yes why not, perhaps we should consider some of our wines no longer investment vehicles but something to be enjoyed.

Wine like all asset markets are hugely volatile at present. Whenever we took on a new investor I made it quite clear that this was not a get rich quick policy although between September 2010 and May 2011 substantial profits were earned. This was not the norm.

The market at present is re-aligning itself however I am confident that growth will be restored once the Euroland issues are resolved. Demand will increase and that will then feed back into the Far East. 

The nights close in. We plonk ourselves in front of the telly or perhaps read a good book. I know port has fallen out of fashion but I still love a good glass after a meal. I recently tasted Dow’s single estate Quinta do Bomfim 1992. This was delicious. full bodied ripe, peppery cassis with a hint of cherry.

 Click here for the detailed tasting notes.

The guide is called Investing in Fine Wines subtitled “Don’t be a Victim of Fraud” It aims to help wine buyers ensure that they do not become victims of fraud by making the right checks before they pay the merchant.

Spokesman Gaving Partington said “‘Recent years have seen a growth in fine wine purchase but the potentially attractive returns have also sadly attracted some fraudsters, particularly in relation to en primeur - wines available for purchase prior to bottling and release onto the market.”

The idea is to provide potential investors with the right questions before they buy their wine.

The advice includes selecting a reputable wine merchant, checking their trading history, track record and address, comparing prices, checking provenance, condition of storage, packing and delivery.

Allister Andrew M.D of We Love Fine Wines said: “Carrying out checks is essential for any wine investor and the WSTA’s guide is essential to ensure that we comply with the highest standards towards our customers.”

Apparently Mr Balestreri showed Mr Panetta his oldest bottle and went onto to say that he would open it when Osama bin Laden is caught. At the time Mr Panetta was head of the CIA and he accepted the bet.

Ted Balestreri has owned the bottle for 30 years. He will open it at a party on New Years Eve. The bottle is worth approximately $10000. According to Mr Robert Parker the doyen of wine commentator’s who exudes the highest of compliments for the wine: “The color is a healthy dark garnet, and the huge nose of freshly sliced celery, mint, cedar, and cassis unfolded quickly, but held in the glass during the 30-40 minutes it remained there before it became just a mere component of my bodily fluids. The wine exhibited sweet fruit, surprising glycerin and opulence for a Lafite, and a sweet, jammy, powerful finish. It is an extraordinary wine!” 

Wow truly impressive and he scores in 96 points out of 100. Mr Panetta’s friends are in for a real treat.

One of the partner in Vintex which does 15% of its business in China, sid that the Chinese are now showing an interest in 5 growths such as Croizet Bage, Pedesclaux in Pauillac and Cantermerle in the Medoc.

Accoding the the Bordelais the recent Sotheby’s sale in Hong Kong at which certain lost of Lafite failed to sell was simply a market correction. “Not at all. We have gone through a period of constant growth. Prices cannot go on increasing forever-this correction was need said Mathieu Chadronier M.D. of CVBG

He went onto to say “It may be tempting to say there is no more demand for the super top wines and perhaps the Chinese are turning their attention to the cheaper wines, but it is not as clear and dramatic as that.”

Apprently at the Sotheby’s sale nine vintages of Lafite failed to sell, including 1961, 1995, 2000 and 2005. In addition wines for Latour, Mouton Rothschild and Margaux did not find buyers.

The bottle sales have been phenomenal with 130,000 being sold in Scandanavia already. The rockin’ Shiraz hails from Australia. Their wine has an aroma of vanilla, blackberries, plums, eucalyptus and liquorice. Full bodied with soft rounded tannins and packs a real punch.

The wine can be enjoyed with grilled lamb chops with garlic and rosemary. However it also marries well with other lamb dishes or beef dishes, as well as past and cheeses. Ideally served between 16-18℃

She goes onto mention that overall she was very impressed with the showing of the vintage. Anthony Barton the owner of Leoville Barton mentioned that he had not yet started to serve either 1995 nor 1996’s at this table. Apparently other vintages such as 1998, 1999, 2000 and 2001 are ready to drink now whilst the 1996’s could deliver much more of what the traditional Bordeaux drinker wants. By that it is meant old style British with plenty of meat on the bones. They have greater ageing potential which is good news considering the heft release price we were asked to pay.

Liv-ex calculates using 23 of the principal Bordeaux cru classes wines that the average price is lower than that for the younger examples from 2005, 2009 and 2010. An example of the recent madness of Bordeaux pricing.

Jancis’ summarises that she felt the 1996’s outclassed the 1995’s with a high level of fragrance particularly from Margaux. The Pauillac’s were more austere than the St Juliens with “less sweetness of fruit and more greenness.”

All the Medoc’s drank beautifully in particular La Mission Haut Brion and Haut Brion. Charles Chevalier from Chateau Lafite claims “I have an extraordinary memory of the 1996. It was a vintage that was exceptionally easy to vinify – perfect for people who did not want to make any effort. So easy. Without any hard work, you had perfect extractions. When you tasted them, the tannins looked great.”

These are big wine and require decanting at least 2 hours before serving, in order to expose them to air, relax and remove the sediment.

However Paul Pontallier from Chateau Margaux expressed his pleasure in the quality of their grapes.

However several pundits claim that the vintage is not up to the standard of 2009 and 2010. For example David Pernet form Sovivins comments “the gap between first and second wines is likely to be significant but the best wines this year will be somewhere between 1996 and 2006.”

One  chateau owner was adamant in insisting that Bordeaux did not want another vintage. “ we would prefer an ordinary vintage. I do not think the market will stand another great year” he said.  “hopefully the top wine chateaux will reduce their prices, perhaps by 20% or more”

Pernet who counts Chateau Pape Clement amongst his list of clients said in his report that having experienced such variable weather “there will be a range of styles across the region. Certain sectors have been affected by hail, others by the springtime drought, or the heatwave at the end of June. More recently, humidity in September has increased the risk of grey rot”

Undoubtedly quality will be maintained by rigorous grape selection in both the vineyard and then later in the chai. Pernet goes onto say “many chateaux will run off the excess juice to increase the concentration”

Eric Boissenot told Decanter.com “This has been a labour intensive year, and the best wines will have undergone vigorous sorting.”

It is anticipated that yields will be lower than the Bordeaux vintage of 2010. Perhaps 10% expects Pontallier as a result of the hail in early June and then very high temperatures towards the end of the month.

Fears of a Greek default roiling the world's markets and stubbornly high U.S. unemployment rates affected the auctions.

Unlike last season, none of the houses sold 100 per cent of their lots.

Despite the economic woes, Christie's set a record this month when it sold 300 bottles of Château Lafite-Rothschild for $539,280 to a Chinese bidder, but the price was below the auction house's high estimate of $580,000.

Total sales for the Hong Kong auction were $7.6 million.

"These results confirm the passion of Asian clients for fine and rare wines, and indicate that interest in wine transcends fluctuations in the world economy," said Christie's head of wine for Asia, Charles Curtis.

His counterpart in London, Chris Munro, sold $1.6 million of wine late last week.

Sotheby's in New York on Saturday sold six magnums of 1985 La Tâche, Domaine de la Romanée-Conti for $60,500, or $20,000 more than its presale high estimate. A case of 12 bottles of 1985 Richebourg DRC fetched $20,570, also above its presale high estimate of $20,000.

Also in New York on Saturday, Acker Merrall Condit sold a threebottle lot of 2003 Romanée-Conti, DRC for $29,280 and a 12-bottle case of 1999 Richebourg DRC for the same price.

"Burgundy was on fire this weekend," Acker Merrall & Condit chief executive John Kapon said.

Cases of 1982 Lafite Rothschild, a wine that frequently trades at auction, saw its prices rise as much as 40 per cent in four months of the year. But it "has now found its range," Kapon said.

He sold a six-bottle lot of '82 Lafite for $24,400, while Sotheby's sold a 12-bottle case of the same wine for $54,450. A week earlier in Hong Kong, Christie's sold a 12-bottle case of 82 Lafite for $58,550.

Source: www.montrealgazette.com

Perhaps the trade became exhausted from the lengthy En Primeur campaign? Many buyers were frightened away by the high prices. Realising that the old adage of paying for your wines 2 years in advance would offer them a discount was no longer viable!  The chateaux were taking the profit and not the market, they forgot about customer loyalty by over stretching their prices. There is plenty of En Primeur stock left and with little enthusiasm I suspect that the Chateaux will be slow to release the wines attempting to maximise their revenues. What a cynical world we inhabit?

Falling demand means that vendors will have to be more realistic about the prices they wish to achieve. Is this a period where prices fall?  My gut feel is that there will be a period of re-trenchment and values will fall. However I still feel that there are opportunities. First growths under £5000?  Mouton over Lafite anyone?  More comments to follow!

As China's nascent winemaking industry makes strides and more wineries establish themselves as leading producers, will growing numbers of Chinese buyers begin to look to local stars, rather than to those of Bordeaux, to satisfy demand?

Well Bernie Ecclestone proved to be a very generous host when the wedding party were served Chateau Petrus. Apparently his son in law James Stunt is a collector of the wine having every bottle since 1945. According to calculations that assuming each bottle would cost around £4000. At half a bottle per head his drinks bill alone for the Petrus and that is without corkage would cost a cool £500,000. The vintage Petrus vintage was unconfirmed.

The bride Petra and the groom were toasted in Louis Roederer Cristal. Very nice indeed!

Mount Langi Ghiran’s chief winemaker Dan Buckle was upbeat about 2011’s prospects of their wines given the conditions that prevailed over the harvest. The stated that drastic grape selection was essential ot ensure that the preimium wineries did not get tarred with the same brush as the glug wine producers.

It has been a long hard struggle to get the message across from the top wine-makers and the challenge was to get the consumer to trade up by spending more on better quality.

China had immense potential and was still relatively untapped by the Australians.

They are Cos D'Estournel, Pontet Canet, Pichon Lalande, Leoville Poyferre, Leoville Las Cases, Palmer, Malescot St Exupery, Pape Clement, Haut Bailly, Angelus, Trotanoy, La Conseillante, Pichon Baron, Lynch Bages, Smith Haut Lafite, La Fleur Petrus, Clos Fourtet, Rauzan Segla, Brane Cantenac and Le Gay.

It was a classic left banker, wine speak for the Medoc. The right bank is St. Emilion and Pomerol. A challenging summer put plenty of stress on the robust cabernet sauvignon, I am told reliably that this grape loves the pressure.

The wines are now well formed and we can begin to see a more settled view of their lives. My view is that the top wines although rather hard and aggressive have begun to soften and mellow. There is plenty of life left in the top right bank wines with Lafite lasting for another possibly 40 years. Undoubtably the best wines were produced from the top end of the Medoc and the best chateaux. I was fortunate to attend a tasting of the best of the 1996 wines a shortwhile ago. Here are my notes.

Chateau Lafite Rotshchild 1996 “ marvellous bouquet of currant, berries and liqourice. Full bodied with silky tannins with a long gentle finish”  Please click here for tasting notes.

Chateau Cheval Blanc St Emilion 1996 “colour of ruby with a purple edge. Bouquet of fresh herbs and plums following on with a cigar box and cedar aroma. Full bodied with soft silky tannins. Terrifically long aftertaste with a hint of chocolate”

Chateau Mouton Rothschild 1996 "Incredible nose of ultraripe fruit, it's yet subtle and complex. Full-bodied, with very ripe, almost sweet fruit and a long, long caressing finish. Superb” Please click here for tasting notes.

Chateau Latour 1996 “Class in a glass. Very racy and fine. But closed and not giving much at the moment. Delicate aromas of minerals, berries and flowers follow though to a full-bodied palate with powerful tannins. Long, silky finish.”

Chateau Margaux 1996 “Sleek and racy Margaux. Inky black in colour, with intense aromas of wood-tinged blackberry, violet, cherry followed by mineral and berry flavors that unfold across the palate and go on and on. Full-bodied and powerful, with a compact fruit and tannin structure.” Please click here for tasting notes.

Chateau Leoville Barton 1996 A well-structured, racy red. Lovely, fresh aromas of raspberries, cream and currants. Medium- to full-bodied, with well-integrated tannins which are firm yet silky. One of the more reasonably priced top '96s.”

Chateau Leoville Poyferre 1996 “Delivers on the nose, with intense aromas of spices, blackberry and dark chocolate. Full-bodied, with silky tannins and a medium finish.”

Chateau Grand Puy Lacoste 1996 “A seamless, pretty '96 claret. Extremely fruity aromas of plums and blackberries. Medium-bodied, with polished tannins and silky texture. Best after 2001.”

The en primeur prices for the 2010’s have set new records,even exceeding the previous highs of the 2009. So where does the clever investor put their money? During the last few months we have witnessed agrowing interest in older vintages that still remain good value. For examplethe 1996 top wine prices have remained stubbornly resilient to the influencesof the market. Alongside the 1996’s then you should consider the 03’s and 05’sall of which look comparatively cheap against the the 09’s and 10’s.

When you also factor in that these “better value” vintageshave also a track record and they have maturity. It is not hard to see thatthey are a smart buy.  Many of the topwines are trading at levels below the highs of 2008 when the market corrected itself. At that time the 05’s had shown the greatest growth and therefore had the furthest to fall. Hence my point about making them look attractive. For example a case of Latour 2005 was £11200 at the markets peak whereas now ittrades at £9000. A case of the 09 will set you back £12500 and the 2010 a cool £12500.

We are seeing the demand for the 2010 down by about 50% onlast year. The 2010 is not a greater vintage than the 2005 so the smart money could be placed in the back vintage of 2005. Given that the 2005’s will be ready for drinking far sooner than the 2010’s.