Almost two years ago, when producing his harvest report on the 2016 Bordeaux vintage, Gavin Quinney predicted: “At the top end, the wines will not be cheap when prices emerge later on, but there’ll be scores of others that offer terrific bang for your buck.” Since then, the critics have reviewed the wines at En Primeur and very recently in bottle and are effusive in their praise. But where does the 2016 position itself in the Bordeaux landscape, and how have high critic scores influenced prices?
With the Burgundy 150 (+36%) driving the broader market, demand for Bordeaux has been muted in the past year. The Bordeaux 500 ran completely flat, while the Bordeaux Legends 50 rose by a mere 4%. Still, some 2016s have seen price rises since release, mostly the second wines of the First Growths: Carruades Lafite is up by 58%, for instance, and Petit Mouton by 33%.
The 2016 vintage stands at the same level as the 2015 in terms of average market price, but there is a difference in scores—about a point higher for the 2016. Running our regression analysis, based on the relationship between average scores and prices, shows that the 2016 is undervalued, as seen in the chart below. Not only does it fall below the trend line, but it lies the furthest below compared to the last ten vintages. This suggests that it offers buyers more value for their money than other vintages, especially against the similarly scored 2009 and 2010.
About two-thirds of the 2016 wines in the Bordeaux 500 appear to be undervalued. Applying our fair value methodology on individual wines identifies which ones offer the most or least value relative to other vintages from the same château.
Clinet lies farthest below from the line, with a score of 96+ and a price of £746 per 12x75. Margaux also comes at a "discount," as it is positioned 32% below the trend line. At the same time, Troplong Mondot’s price of £1,057 (+54%) might be hard to justify given that a similarly scored 2008 costs £675.
Mouton Rothschild (rated 100 points by Lisa Perrotti-Brown), is undervalued by 6% and commands a current market price of £5,050 per 12x75. The “extravagant” and “magical” Cos d’Estournel (also rated 100 points), which has seen a flurry of trade on Liv-ex, falls 5% under the trend line. The wine last traded at £1,720 per 12x75 and is currently bid at £1,500. Figeac also appears 4% underpriced at £1,848. Overall, 100-point wines—by definition, perfection in a bottle—more often than not command a premium to fair value.
Leoville Las Cases might also present interest to some buyers. It falls 7% below the line and is available at a 4% discount to its release price.
Bordeaux 2016 delivers “on its promise.” The vintage appears generally undervalued having moved little since release, according to the Liv-ex fair value analysis.
Readers should take note that the views of this author represent those of a company with an interest in the wine trade. Liv-ex operates the global marketplace for fine wine. It offers trading, data and settlement services to professional buyers and sellers of fine wine. Private collectors can view Liv-ex prices and value their portfolios using Cellar Watch and find regular market analysis on the blog. The opinions of Liv-ex are their own and do not represent those of Robert Parker Wine Advocate or Wine Journal. Liv-ex contributes articles to Wine Journal that we feel are of market relevance to readers, but we do not specifically endorse this company.