According to data released by Liv-ex, UK sales of en primeur halved from 2016 to 2017, following an upward gradient from 2014-2016. In material terms, this is reflected by a 60% discount in trading volume from last year’s campaign with the UK trade selling £45 million worth of 2017 en primeur. This places total sales closely in line with the 2011 vintage, which saw £46.6 million sold by the UK trade. IG Wines saw a 34% decrease of sales in the 2017 vintage. It is important to note that 2017 saw a material reduction in volume produced. The focus of these UK sales is reported to be weighted towards the most popular established brands, with First Growths in particular proving successful. This is representative of our experience, 35% of our en primeur sales consisted of First Growths.
Several merchants and Liv-ex have reported that the perception of quality in the 2017 campaign was that the vintage was below the quality of 2014. The numbers, however, tell a different story. The 2014 vintage was one we pressed and advised as a strong buy vintage, in the face of market malaise. Its price performance since release has been superb and the wines scored considerably higher from bottle. Based purely on the Wine Advocate scores, the most popular, respected and consistent data set, the leading 133 en primeur estates scored 0.86% higher in 2017 than in 2014; the higher 2014 bottle re-scores! Our assertion and the general feeling in the global trade is that while the 2017 vintage is less heterogenous than either 2015 or 2016, the quality is closer to these vintages rather than in 2014. In some cases, particularly leading left bank estates, such as Lafite Rothschild, the 2017s are on par or better than 2015 or 2016. In fact, it is interesting that the price taken from the leading 133 Estates in 2017 displays an average discount in price of -9.71% to the 2016’s trading prices, while only a 1.31% drop in quality, according to the Wine Advocate average scores.
Establishing fair value for en primeur releases is not facile. One of the metrics available for us to discern the value of any release is its discount in price to the previous year’s release price, or current market price. This is largely touted by the industry as a key indicator, but it is not sufficiently instructive, as it only compares the new vintage to the previous. The top 10 discounts to 2016’s current trading prices were:
|Chateau||Village||WA||Release||2016 Price||Discount To
|La Mondotte||St Emilion||96-98+||£1,428||£2,390||-40.25%|
|Les Carmes Haut Brion||Pessac||91-93+||£672||£1,120||-40.00%|
|La Mission Haut Brion||Pessac||95-97||£2,760||£3,950||-30.12%|
|Troplong Mondot||St Emilion||95-97||£864||£1,200||-28.00%|
The table above does reflect some of the best value releases, however, it is worth noting that some appear due to their superb secondary market performance, such as Les Carmes Haut Brion, Ausone and Canon, which help provide the positive discount. This does show the estate’s willingness to provide a discount, leaving money on the table for collectors. However, on the flip side, La Mission Haut Brion and Figeac provide such a positive discount due to the price rises seen in 2016. Drilling down further, the First Growths lead the way in terms of price reduction, offering a 17.39% average reduction to the current market price and a 14.14% discount to the release price. The Second Growths provided an average discount of 15.01% to the average trading price and 11.43% to their release price.
Another useful metric is a wine’s price on release compared to the average trading price of other vintages taken from several years. The leading ten estates with the largest discount to their average market price from 2005 and 2009 through 2016 with a score in 2017 of 94 or greater are as follows:
16-09 & 05
|La Mondotte||St Emilion||96-98+||£1,428||£2,337||-38.89%|
|Pape Clement Blanc||Pessac||94-96+||£1,200||£1,548||-22.50%|
|Peby Faugeres||St Emilion||93-95||£1,170||£1,485||-21.21%|
|Leoville Poyferre||St Julien||93-95||£666||£836||-20.35%|
One of the other preferred mechanisms for assessing a wines quality is comparing it to similar vintages, or a singular, closest vintage by score. This is more heuristic and not easy to do scientifically. However, the cleanest way is to create a comparative score from qualitative and quantitative values, the Price Over Points ratio (POP). The POP is calculated by taking Robert Parker’s score and subtracting 80 from the total, scoring the wines out of 20 increasing the weighting of each point. The new score is then divided by the price of a nine-litre case giving the POP score, the implication being that the lower the score the better the relative value. The average POP score in 2017 is 86.93, which is considerably better than that of the same wines from 2005 through 2016, which return 102.93. It can be posited therefore that in many cases the 2017 vintage must offer value on release! The best POP scores in class are Mouton Rothschild which has the lowest POP of the First Growths with 292.77 and Rauzan Segla for the Second Growths with a score of 43.20. The best of the right bank with a score of 94 or higher are Pavie Macquin with 39.50 and Gaffeliere with 35.94. If you are looking for the best value, these are the wines that stand out.
The top ten releases when compared to their average POP score running though the same vintages are as follows:
|Chateau||Release||WA||17 POP||Avg POP||Avg Price|| 17 POP to
Based on these metrics, we can draw some strong conclusions regarding the best releases and those which offer short-term value:
Rauzan Segla 2017, 12×75 – £648 IB, 6×75 – £324 IB, 94-96 Pts WA
Rauzan-Segla is a notably strong buy due to its POP ratio, the best in class amongst the leading Second Growths. Rauzan Segla has become a highly allocated wine due to its recent high scores which reflects its brilliant quality and rise to being arguably Margaux’s finest Second Growth. This has led to large gains for collectors and the 2017 is yet another amazing vintage which confirms the frenzy around this superstar. With 94-96 points from the Wine Advocate and 95-96 points from James Suckling, the 2017 Rauzan Segla is a top vintage and has the potential to tie with the exquisite 2016. With the very sensible release price of £648 a full case, the 2017 vintage is trading at a healthy discount to the similar scoring vintages such as the 2016 and 2010.
Mouton Rothschild 2017, 12×75 – £4,320 IB, 6×75 – £2,160 IB, 97-99 Pts WA
Mouton Rothschild is the best in class in terms of value amongst the First Growths, with the lowest POP score. It also features among the finest in terms of POP score in 2017, compared to its average score, making Mouton Rothschild superb value when compared to its peers and own vintages! Priced at £4,320 per 12×75 or £2,160 per 6×75 it displays a very attractive £820 discount to the current trading prices of the 2015 and 2016, despite scoring potentially higher than the 2015 and just one notch behind the stunning 2016. There is now over 30% of room on the table against the other similarly scoring vintages, so Mouton have really priced this right and this is definitely a great buy.
Lynch Bages 2017, 12×75 – £875 IB, 6×75 – £437.50 IB, 95-96 Pts JS
Lynch Bages features as one of the best discounts to 2016. Lynch Bages is one of the big names of Bordeaux, which is evident with vintages such as 07, 12 and 13, which despite being scored 87-88 by the Wine Advocate, trades at around £800 and up to nearly £1,000. The 92 point 2005 is £1,250. The 2017 is a very good Lynch Bages; it has a strong 95-96 from Suckling and it looks positioned to perhaps outscore the 2014 and 2015 by the Wine Advocate. Priced at £875 per case of 12, or £437.50 per case of six it is a strong buy, particularly with a late but impending Wine Advocate score on the horizon, making it a strong short-term and obvious long-term play. Either way, priced at £875 it will look very cheap over the next few years.
Pichon Lalande 2017, 12×75 – £1,116 IB, 6×75 – £558 IB 94-96 Pts WA
Pichon Lalande 2017 features in the top ten best value wines compared to the relative price of equivalent vintages, based on its POP score compared to vintage averages. It is a firm favourite around the world and offers a 21.4% sterling discount to the 2016 release (£1,420), making it compelling. The 2017 trades below the average price of the last 15 vintages, despite being potentially the Estate’s second-best effort, along with the 2015 and behind the amazing 2016. The Estate has been wowing critics and collectors over the last nine vintages and this year’s high score blows most out of the water, perhaps besting the 2009 and 2010, which average £1,325 per case.
Lafite Rothschild 2017, 12×75 – £4,950 IB, 6x75cl – £2,475 IB, 97-99 Pts WA
In 2017 Lafite Rothschild is the king of the Medoc. It a must own wine in 2017, offering the best value based on quality vs price, while also offering one of the best discounts to it average case price. It released for £4,950 per case of 12, or £2,475 per case of six, a reduction of 12.4% on the release price of the 2016 and a 21.4% discount to its current trading price. The stars are aligned to make this one of the greatest Lafite Rothschilds of this century equalling the 2009 and 2010. What makes this 2017 vintage even more exceptional when comparing it to both the 2010 and 2009 is that it is only 1/3 of the release price of these vintages. Past vintages indicate a market price of around £7,100 per 12 bottle case of a 98 point wine. This suggest that today’s release price of £4,950 therefore leaves around £2,150 in appreciation on the table for those taking an early position in the vintage.
Ausone 2017, 12×75 – £5,650 IB, 6×75 – £2,825 IB, 97-99 Pts WA
Chateau Ausone has the distinction of being listed in the top ten table for all three metrics, displaying a large discount to 2016 on release, a large discount to its average trading price and the second-best discount to its average POP trading value. With barely 2,000 cases made a year and an 11% production reduction in 2017, this St Emilion is one of the hardest allocations to get. The release price of £5,650 marks an important 21% decrease from the 2016 release price and represents a 28.5% and 33% discount to the current trading prices of both 2016 and 2015 which are similar scoring vintages. The average trading price for any vintage scoring 97 points or above is £9,050, leaving the 2017’s release price with a potential of £2,400 upside for the long term. It is a must buy in 2017.
La Mondotte 2017, 12×75 – £1,428 IB, 6×75 – £714 IB, 96-98+ Pts WA
A hidden gem in the campaign is La Mondotte, with a 96-98+ point score from the Wine Advocate and a 40% discount to 2016 is one of the buys of the vintage! It features as second in terms of discount to 2016 and in its discount to its average trading price. As well as offering a 40% discount to the 2016 release price it also offers a 57% discount to the far lower scoring 2015. Instructively the 2010 trades at more than double the price, which incidentally also received a score of 96-98+ from the Wine Advocate from barrel. La Mondotte has an amazing vintage premium, which is due to its rarity and huge critical acclaim – the 2009 trades at a whopping £4,700 per case! Only the 2013 trades for less at £1,300 and the average trading price for the leading vintages is nearly £3,000, leaving around £1,500 on the table for the 2017.
Cos d’Estournel 2017, 12×75 – £1,308 IB, 6x75cl – £654 IB, 97-100 Pts WA
Finally, the wine of the vintage Cos d’Estournel which was awarded a potential 100 point score from the Wine Advocate outscores, Lafite, Latour, Mouton and Ausone! This left plenty of room for the Estate to fully price their release, however, despite the high score, they reduced 7% from 2016, making this a must buy in the campaign. St Estephe has been incredibly strong in both 2016 and 2017, with Cos out-ranking Montrose and taking prime spot as a wine of the vintage in both campaigns. Its release price of £1,308 leaves 24% on the table following the 2016, currently trading at £1,625. Furthermore, if this does go on to receive 100 points, it can increase 87% to catch up with the 2009! Even if it receives 97 points, the lower end of the scale, there is a potential 34% gain in the short term. It’s a superb buy and a stunning wine in 2017.