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Top 10 estates for en primeur returns

A recent Liv-ex report explored the last 10 years of Bordeaux vintages from 2004-2013 for 50 of the leading estates, including the second wines of the first growths, and revealed a number of interesting patterns and nuggets of information.

Among them was a list detailing how each of the labels has fared in en primeur returns over the 10 year span from their average ex-château release price per bottle to their 10-year return based on their current average price per bottle (relative to merchant release).

The following 10 wines have seen the best return on investment over the last 10 vintages and the worst 10 performers will be listed at a later date although La Fleur Petrus, Le Pin and Petrus have been excluded from both lists as they don’t strictly adhere to the en primeur system and the Sauternes estates bar Yquem have also been excluded as they generally suffer unfairly in comparison with the reds and do not attract as much investment interest.

The list is interesting for a number of reasons. To begin with it is Left Bank dominated – in line with reports in January that the Médoc was rising again and the previously stronger Right Bank beginning to decline – only two wines are from the rive droite.

Second wines from the first growths are also heavily entrenched towards the upper part of the list and the remaining wines are nearly all fourth of fifth growth estates and one third which corresponds to the trend for buyers seeking out good value estates during Bordeaux’s recent wilderness years.

With one very obvious exception and another slightly less obvious one, all of the wines have had an average ex-château price of under €50 per-bottle (p/b) and all have an seen an average return of over 25%.

All prices quoted unless stated otherwise are ex-château and the “current price” quoted is based on prices relative to their merchant releases, from which the returns are calculated.

10. Calon Segur

2013 price ex-négoce: €37.20 (-3% on ’12)
Average ex-château price: €31
Average ex-merchant price: €44
Average current price: €55
Return: 26%

The solitary third growth and the only entry from St-Estèphe, Calon-Ségur has been going from strength-to-strength since it was sold to Suravenir Assurance in 2012.

Prices climbed strongly between late 2012 and early 2013 and a lot of money has reportedly been poured into the winemaking and production facilities too.

With an average release price of €31.90 between 2004 and 2013, the estate has a current average price of €55.70 p/b ex-, a 26.3% return.

9. Pontet-Canet

Pontet-Canet owner Alfred Tesseron with one of the estate’s horses

2013 price ex-négoce: €60 (0% change)
Average ex-château price: €46
Average ex-merchant price: €64
Average current price: €81
Return: 26%

High-flying Pauillac fifth, Pontet-Canet has received consistent praise for its quality and relative value but lost a little of the good faith by releasing its 2013 vintage at the same price as its 2012 – and well in advance of the main campaign a tactic not so far repeated this year.

Nonetheless, with an average release price of €46.60 p/b and a current bottle price of €81.60, it has also seen a 26.3% return.

8. Talbot

2013 price ex-négoce: €26.40 (0% change)
Average ex-château price: €22
Average ex-merchant price: €29
Average current price: €38
Return: 27%

A fourth growth that quietly goes about its business and the cheapest of the top 10 and one of the cheapest of the entire list with an average bottle price of €22.60 on release and which now has an average bottle price of €38 p/b, a very tidy 27% return.

7. Lynch-Bages

2013 price ex-négoce: €50 (-17% on ‘12)
Average ex-château price: €45
Average ex-merchant price: €61
Average current price: €83
Return: 36%

Another trade favourite, “Lunch Bags” is consistently mentioned among wines that have managed to sell in otherwise torpid campaigns.

With a release price average of €45.20 p/b, its current average price is €83.10 p/b a rather significant step-up on returns to 36%.

6. Angelus

2013 price ex-négoce: €165 (-8% on ‘12)
Average ex-château price: €119
Average ex-merchant price: €153
Average current price: €213
Return: 38%

The somewhat controversial Angelus, the first Right Bank estate on this list, is the only wine to have an average bottle price of over €100 – an average no doubt boosted by its high release prices which stubbornly stayed up once it and Pavie were elevated to “A” status in 2012.

The Saint-Emilion property has an average release price of €119 over the last 10 vintages, yet, with a current bottle costing €213.50 on average it has seen a 38.7% return.

5. Pavillon Rouge

2013 price ex-négoce: €72 (-4% on ‘12)
Average ex-château price: €46
Average ex-merchant price: €67
Average current price: €96
Return: 42%

The first of the second wines and the only Margaux on the list, Pavillon Rouge has traditionally been the weakest performer among the second wines but has regained some lost ground over the past year.

With average bottle prices of €46.80 on release, its current average price of €96.40 p/b means it has seen a 42.6% return on average.

4. Beychevelle

2013 price ex-négoce: €38.40 (-6% on ‘12)
Average ex-château price: €28
Average ex-merchant price: €39
Average current price: €58
Return: 47%

Another Médoc stalwart that flies under the radar, its stock grew in Asia thanks to its dragon boat label and despite the faltering Chinese market it has weathered the downturn nicely.

Prices for physical stocks grew 15% in the last year and activity in 2014 surpassed that of 2011. Average release prices tend to hover just below the €30 mark at €28.60 p/b and with current bottles fetching €58.60 on average it has a solid 47.6% return.

3. Carruades de Lafite

2013 price ex-négoce: €90 (-10% on ‘12)
Average ex-château price: €52
Average ex-merchant price: €101
Average current price: €151
Return: 48%

Another mighty second wine, albeit one that has suffered most from the Chinese downturn having risen so far in tandem with its parent grand vin between 2009-2011.

Prices have dropped 47% on average since the market peaked in July 2011 yet it still trades for €151 p/b on average today. Up from an average release price of €52.30,that represents a 48.2% return on investment.

2. Clos Fourtet

2013 price ex-négoce: €44 (-2% on ’12)
Average ex-château price: €36
Average ex-merchant price: €48
Average current price: €75
Return: 57%

The second and last Right Bank estate on this list, Clos Fourtet is the cheapest wine in Liv-ex’s Right Bank 100 index yet also the one with the best scores – probably one reason it was noted last year it was bucking an emerging slump in Right Bank activity.

One of the best performers in the Right Bank 500 since the market declined in 2011 it has offered 57% returns with an average current price of €75.70 p/b on the back of €36.20 p/b ex-château releases.

1. Petit Mouton

2013 price ex-négoce: €66 (0%)
Average ex-château price: €48
Average ex-merchant price: €67
Average current price: €116
Return: 72%

And Mouton, first growth of the moment and since the rout of Lafite the best-performing first growth property with the best-performing second wine to boot.

With only the 2010 having lost buyers any money in the last 10 years, Le Petit Mouton can otherwise boast returns of 72.6%, with release prices of €48.80 p/b having risen to €116.30 on average today.

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