Issue 2 - May 2012
the Bordeaux Fine Wines Magazine
SHOW ME YOUR
I'LL SHOW YOU
MY WINE CELLAR
Expense, it seems, has no limit to those who
have acquired a taste for wines. See Page 7
Wine market set for a
Happily in the Red
Wine bottle sizes?
2009 Bordeaux Scoop!
Fine Wines Ltd www.bfwines.co.uk
Bordeaux the Bordeaux Fine Wines Magazine
Welcome to the Spring edition of Bordeaux Fine
As global wine buyers converge on Bordeaux for the
annual futures sale that opens this month, this year's
main organiser of the event, the Union of the Grands
Crus (UGC), expects to welcome about 5,000 wine
professionals to the southwestern French city.
This unique system, called "en primeur", allows
buyers to stake a claim on coveted labels by paying 12
to 18 months in advance of their delivery. Last year, the
Chinese made their first foray into Bordeaux futures.
China is now Bordeaux's number one trading partner,
and a recently formed Chinese wine fund plans to spend
in excess of 100 million euros over the next five years.
That is Bordeaux's dilemma. Prices have skyrocketed
over the last decade, alienating traditional customers in
America and Europe in favour of rapacious demand
from China's super-rich.
Logically, the prices for the 2011 vintage should open
lower and that would allow Europeans and others to
come back to the market after being bypassed by Asians,
particularly the Chinese.
This in itself presents a fantastic buying opportunity
for the investor depending on whether this vintage is
any good. Follow us and invest in wine today.
Remember if you have any questions about your fine
wine portfolio, please do not hesitate to get in touch
with the Bordeaux Fine Wines team.
Fine Wines Ltd
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Wanchai, Hong Kong.
Wine market set
for a strong year
Recent research has suggested that the wine market could grow by ten per cent
in 2012, with an abundance of opportunities for wine investors throughout the
year, according to The Fine Wine Market Outlook 2012.
he global survey of the won’t live up to the quality that was
wine trade canvassed the produced in 2009 and 2010.
opinions of 120 leading The call for a drop in en primeur
merchants, auction houses, 2011 price does not reflect a drop in
brokers and investment fund demand. The market is expected to be
managers in the fine wine sector, reinvigorated this year, as chateau get
and indicated great opportunities realistic with their pricing structures.
for buyers. The report is compiled However, there was a strong
by Wealthmonitor and online contingent believing Bordeaux will
magazine Wine Yields. They lead the market gain this year.
detailed in a 40-page report the Intelligent pricing will reinstate
opinions of major industry confidence in investors who feel they
participants in the global fine have fallen out of touch with the
wine sector in Asia, Europe and wine region. The succession of great
the Americas. 21st century vintages has left many
The market is expected to be reinvigorated this year,
as chateau get realistic with their pricing structures
The report suggests some of the investors feeling out-priced, which is
best buying opportunities wine why 2011 is a crucial year for
collectors and investors have seen in Bordeaux to lure back in the wealth
several years." of potential investors that are ready
The majority of respondents (60%) to invest in what has been an
said they expected the fine wine astounding start to the 21st century
market to increase, with most of for winemakers in Bordeaux.
those expecting gains of ten per cent. The new confidence expressed in
Managing director of Chateau The Fine Wine Market Outlook 2012
Lafite recently advised that Bordeaux is a reassuring sign that the chateau
had to be ‘less arrogant’ in its pricing will get intelligent with their pricing
this year, saying that it is widely this year.
recognized that the 2011 vintage
Bordeaux - Issue 2: May 2012 | 3
Wine-based investments are becoming an alternative for Chinese investors
any Chinese investors, Bordeaux and Burgundy wines. bottles of 750 milliliters per case) in
faced with rising inflation As China creates more 2010, growing 34.4% with projections
and a volatile stock opportunities for investments into of nearly 250 million cases by 2016,
market in a slowing economy, are luxury products, many Chinese according to the International Wine
increasingly in the red. Though some consumers are buying. and Spirit Research's (IWSR) China
might indeed be experiencing losses "The best-known brand among Wine Market Report 2011. The
with financial products, which in the Chinese, 2008 Lafite Rothschild, for IWSR is a provider of data on
recent past included investments in instance, has hit an astounding wines and spirits.
antiques, diamonds, stocks and fine increase of 194% (in price) during the Hong Kong in particular has
art, what a growing number of past three years. The huge investment become the wine hub of China. The
investors and consumers in China benefit has greatly surprised and Hong Kong Wine Exchange was
are becoming more passionate lured Chinese investors, though launched in October as a trading
about is investing in
wine, in particular
reds such as
In recent years, as
China pushes for
spending and its
falling in love with status symbols,
hot alternatives to the stock and real
estate markets have been wine
investment funds and wine
exchanges, which reportedly offer a
buffer against the nation's rising many don't quite understand the platform to buy and sell globally
inflation. A growing market for wine, wine culture. through the company's network
China surpassed Germany to become Yu Li, personal banking manager of wine storage partners. Taxes on
the top Bordeaux importer in volume of China Merchants Bank, says the wine in Hong Kong were eliminated
last year. Chinese wine-based investment in 2008.
The wine-based investments market is booming. At the fine wine One of the major factors in the
essentially funnel money into auctions of Sotheby's and Christie's growing wine market is increasing
financing wineries and in return in Hong Kong last year, more than demand from China where
expose Chinese consumers to a 50% of the attendees were from the consumers' tastes have grown
greater amount of wines. Chinese mainland. Mr Yu Li, also more sophisticated.
The nation's first wine investment added that owners of the eight "Chinese are apt to invest in wine
fund, called the Ding Hong Fund, prestigious Bordeaux chateaus have futures that are bought before wines
was launched in August. Vintex & visited China recently. are bottled and released to the market.
Les Vignobles Grgoire, which will "This was unimaginable five years Chinese particularly like the wines
manage the fund's wine buying, said ago. They come to China for nothing that are considerably cheaper and
it plans to raise 1 billion yuan ($156 but to sell more wines," he says. highly limited in quantities," Yu says.
million, 124 million euros) over a The wine market in China reached There are three categories of
five-year period and will invest in 125 million cases (12 normal sized investors: those who invest for the
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purposes of trading, those who are by customers,
adding to their wine collection and because many
those who want asset allocation. people love to
Most investors belong to the third get acquainted
category and may also invest in gold with the value of
or in real estate. Currently most wine investment
buyers of wine-investment products in this way,"
are high-end customers with a great Yu Li says.
interest in wine. Yu Li says a return on China
wine-based investment is currently Merchants Bank
not that considerable, but points out is planning to
that many customers are not in the cooperate with
market just to make a buck. They are wineries around the
wine lovers and collectors. world later this year.
As the market for wines grows in "Obviously the chateaus that
China, the nation's banks have achieve Premier Cru (first growth) government.
jumped on the bandwagon. As early status in the Bordeaux (Wine Official) Both fine
as 2008, major banks in China, such Classification of 1855 are more wine and
as the Industrial and Commercial valuable," he says. Chinese liquor are
Bank of China, Bank of China and Another consequence of the exchanged on
China Merchants Bank, have created growing wine market has been the the market.
wine-based financial products. growth of wine trading exchanges, Li Wenfeng, president of the
The products usually introduce such as the Shanghai Wine Exchange, Shanghai International Wine
customers to domestic wineries as the first online exchange center in Exchange, says the exchange has
investment targets. China Merchants Asia that was established last July. direct cooperation with wineries and
Bank, for example, introduced its Every day, around 6 million yuan liquor producers to guarantee quality,
authenticity and affordable prices.
"The potential of Chinese wine investment "The potential of Chinese wine
investment market is beyond
market is beyond imagination. And the imagination. And the Chinese
market will sooner or later
Chinese market will sooner or later become become the exchange center,
the exchange center, helping price fine wine helping price fine wine around
the world," Li says.
around the world," "The appearance of
e-commerce platforms like these
wine futures in famed Chinese to 7 million yuan changes hands. Gu online exchange centers serves as a
winery Chateau Junding, owned by Guang, founder of the exchange, says good settlement for the problem of
China National Cereals, Oils and current growth rates suggest that the wine circulation. It at least shows that
Foodstuffs Corp, in 2009. exchange volume may reach in the China is keeping up with Western
Through wine futures, investors tens of billions in yuan in three years. paces," Yu says.
can purchase wines early while a The Shanghai International Wine The Chinese' zeal for wine has
vintage is still in a barrel and before it Exchange, established Dec 18, 2011, is greatly encouraged and benefited
is bottled. the only high-end wine exchange wine producers and retailers
"The products are highly accepted that is supported by the Shanghai worldwide.
Bordeaux - Issue 2: May 2012 | 5
Show me your Ferra
and I'll show you m
Expense, it seems, has no limit to those who have acquired a taste for wines
f a wine connoisseur can spend Qiang, referring to a quality wine. He wine they like. Anyway, they have to
12,000 yuan ($1,900, 1,440 is the chief designer heading a 20- be affluent enough to build a cellar
euros) on a bottle of Lafite or strong team at Sicao Wine Cellar in and moreover, to fill it."
Latour, he or she probably has Shenzhen, one of China's earliest "The biggest collector I have
enough money to build a private cellar design firms. worked for has more than 30,000
cellar to store the investment. Chen, who used to be an interior bottles of vintage wines, which would
As demand for fine wine, especially designer in Shenzhen, first came to probably amaze many wine sellers."
expensive vintage wine, soars in Beijing in 2006 to design a cellar for a He is now working on a huge project,
China, wine cellar design firms are Spanish restaurant. a 6,000 to 9,000-square-meter cellar
becoming well-versed in interior and "At first, we were actually learning for a celebrity that will cost at least 40
wine storage design. from the European cellars and million yuan.
In recent years, wine has begun to exploring our own ways to construct a More than 960,000 people on the
denote wealth. High-end open local one in a different climate and a mainland have personal wealth
houses and luxury new car releases different situation." exceeding 10 million yuan; about
frequently revolve around wine Chen's company has grown rapidly 60,000 are billionaires. Beijing,
tasting parties. in Beijing since 2006. He says revenue Guangzhou and Shanghai top the
According to the International has been growing at least 70% a year. list of cities home to those with
Wine and Spirit Research's 2012 "Only three people out of a personal wealth of more than 10
China Wine Market Report, wine hundred might know what wine million yuan, with 170,000, 157,000
consumption in the country increased storage cabinets were in 2007. But and 132,000 millionaires in each city
33.4% year-on-year to 156 million now, more than 30 would say they respectively, according to the 2011
nine-liter cases (12 750-milliter have heard about them." Hurun Wealth Report.
bottles a case) last year. China is the Most of the cellar owners are In line with the report, custom
world's fifth biggest wine consumer business tycoons or celebrities who wine cellars are mostly found in
after the United States, Italy, France have a yearly income of at least 10 Guangzhou, Beijing, Shanghai and
and Germany. million yuan. Shenzhen. Cellar design firms first
"A professional, private cellar is not "We intend no offense, but our appeared in coastal cities in
only a cradle of the Grand Cru babies, customers naturally belong to the Southeastern China, close to Hong
but is also a symbol of social status, upper class. They travel frequently Kong, in 2004 or 2005. They have
life quality and taste," says Chen among countries and bring back the been expanding their business to
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Beijing, and Sichuan and Shanxi
Wine is best stored at a constant
temperature (12 °C to 15 °C) and
humidity (about 65%), low lighting,
free from vibration and optimum
"An air conditioner to control the
temperature and humidity is the soul
of a cellar," says Li Chunhui, general
manager at Wine Town's Beijing office,
stressing the importance of the
Chen says cellars in China are
usually equipped with better
functioning cooling systems than
those in Europe.
"Chinese moneybags always want
extremely good equipment, even
when they aren't quite familiar with it.
For example, one will first buy all
professional equipment and clothing
before learning how to ski, even better
equipped than professional athletes,"
"The biggest collector I have worked for
The cost of a basic cellar ranges has more than 30,000 bottles of vintage
from 15,000 to 30,000 yuan. A 20-
square-meter cellar, which can store at wines, which would probably amaze
least 500 bottles of wine, costs about
400,000 yuan. (Continued overleaf )
many wine sellers."
Bordeaux - Issue 2: May 2012 | 7
Photo by Kim Reinick
Only 10 % to 20 % of the total cost companies in China. It plans to Apart from the storage function,
goes toward the design and planning, establish another office in Shanxi private cellars give much added value
20 % is for cooling and 60% is for province this year. "Cottages in to homeowners. The rich are usually
fittings, such as wine racks and Shanxi are usually very big and cellars only too eager to impress their friends
decorations, says Chen Liang, general of hundreds square meters are very and guests with a large collection of
manager of Shenzhen Raching, one of common there, perhaps due to the fine wines in their cellars.
the top three wine storage solution relatively low housing price and the "There is a gradual recognition
providers in China. many wealthy people there," among wealthy wine lovers. It is
Raching's success is another piece Li says. sometimes even regarded as the
of evidence of the soaring demand in The potential of the Chinese wine code to enter the upper class."
the wine storage market. For each of storage market is unknown, because Li believes a private cellar
the past three years, Raching's
revenue has grown 100%. Its revenue
last year topped 200 million yuan.
Cellar design firms are the typical
partner with architecture design
studios and real estate companies.
"Real estate companies are sparing
no effort to make high-end properties
more competitive. A property with a
fine wine cellar is becoming more
appealing for homebuyers," Chen
Designers sometimes struggle
when they are told to put fashion "The optimum wood for the wine rack should be oak, for
before function. Some customers
request a wine rack made of rare it is not likely to become deformed in the environment of
Hainan scented rosewood or low temperature and high humidity."
sandalwood, pushing the total cost
to more than 10 million yuan for a China is far from the land of vintage shouldn't just be a privilege for
20-square-meter cellar. wine. Unlike people in France who wealthy people. As knowledge
"The most expensive does not can buy high-quality wine at any and awareness of wine storage
mean the best," says Xie Jiaxin, sales time, Chinese need good conditions spreads, more wine enthusiasts
manager of Wine Town Cellar Design. for wine storage to safeguard and can construct them.
"The optimum wood for the wine improve the quality of their Premier The most unforgettable project he
rack should be oak, for it is not likely Cru treasures, Li says. has worked on was a 10-square-
to become deformed in the "Wines are never dead things. They meter cellar, which cost about 100,000
environment of low temperature and are like sleeping beauties, and they yuan, for a retired worker in his old
high humidity." grow in bottles as time goes by. You apartment.
Wine Town, based in Shanghai, is have to provide them with the right "It was a small one, but delicate
one of the top custom wine design shelter." and full of joy," he says.
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Wine bottle sizes?
Whereas it isn't really necessary As well as the traditional (in many terminology, and consequently some
to have any knowledge of wine cases, legally required) 750ml bottle , Jéroboams (four bottles) may be
bottles in order to appreciate wine, the useful half-bottle (containing found. The Bordeaux terminology
the bottles are vitally important. 375ml of wine, a common format for seems quite restricted to that region
A glass bottle, sealed with a cork sweet wines, such as chateau alone. Large format bottles are
or other device, is undoubtedly d’Yquem), and the perhaps familiar popular with Bordeaux collectors,
preferable for the storage and magnum (containing 1.5 litres, as particularly the eight-bottle
transport of wine than the with the Pichon-Lalande), there are Impériale. This is because the small
alternatives, which once included a number of even grander 'large amount of air in the bottle (between
wooden barrels, amphorae or even format' bottles. Many of these are the cork and the wine) and the large
animal skins. Glass is inert, and named after biblical kings (I've never amount of wine results in a smaller
together with the cork seal (putting found out why that is). Most air to wine ratio, and this would seem
aside the problem of cork taint just confusingly, however, the same name to favour slow development of the
for one moment) it provides an may be used to refer to different size wine when compared with smaller
excellent environment for the long bottles in different regions of France. formats. The same cannot be said of
aging that some wines demand. The The table shows the large format large format bottles of Champagne,
colouring of the glass also aids, in a bottlings commonly referred to. as these are really only for show, and
small way, in the protection of the Other regions of France, Europe, in general, other than the commonly
wine from potentially damaging light, and the New World also bottle some encountered magnums, they are filled
although of course there's no wine in large formats, particularly using wine poured from single 750ml
substitute for storing your wine in a magnums. For larger bottlings, bottles prior to sale.
cool, dark cellar. most tend to follow the Burgundy
Bottle Bordeaux Wine Burgundy & Champagne
equivalent Bottle Sizes Bottle Sizes
Two (1.5L) Magnum Magnum
Three (2.25L) Marie-Jeanne -
Four (3.0L) Double magnum Jéroboam
Six(4.5L) Jéroboam Réhoboam
Eight (6.0L) Impériale Methusaleh
Twelve (9.0L) - Salmanazar
Sixteen (12.0L) - Balthazar
Twenty (15.0L) - Nebuchadnezzar
Above: table of wine bottle sizes commonly referred to
Bordeaux - Issue 2: May 2012 | 9
2009 BORDEAUX SCOOP!
Robert Parker Gives 19 Wines 100 Pts
ritic Robert Parker has vintage and referred back to his first
released his in-bottle note after the en primeur tastings
scores for Bordeaux 2009, when he called it “unquestionably
describing it as “not a myth but the greatest Bordeaux vintage I have
mythical”. ever tasted”.
He stated that the most striking This view has only been
aspect of the vintage is its intensified by his latest tasting.
consistency across producers, He concluded: “In short, 2009 is
particularly cru bourgeois and the greatest vintage I have tasted in
petits vins. Bordeaux since 1982, of which it is
Originally on release a list of 16 a modern-day version, but greatly
perfect wines according to Robert improved.
Parker were provided. Now that the “It is more consistent (many
official list is out, we have more châteaux that were making mediocre
record breaking news for you. Make wine in 1982 are now making
that 19 One Hundred Point Wines brilliant wine) and of course, the Above: Robert Parker
according to Robert Parker! Our list yields are lower, the selection process the 2009s are, they are remarkably
has been updated. is stricter, and there are any other pure, well-delineated and
In total, 19 wines garnered a number of factors, from investments surprisingly fresh and vibrant
perfect 100 points, including a white, in the wineries to impeccable, radical – a paradox, but a wonderful one
and 11 received 99 or 99+. viticulture, that have resulted in at that.”
This is important because it is the extraordinary raw materials.” Parker’s Magical 20 tasting
views of Robert Parker that often set “Just like in 1990 or 1982, the low in Hong Kong last year renewed
demand and price for the best acidity, the very ripe fruit, the high interest in the vintage, as have
Bordeaux wines. Wines from Pauillac, glycerin levels from the elevated various reviews and scores released
St. Julien, Graves/Pessac Leognan, St. alcohols, and the stunning prior to Parker.
Estèphe. Pomerol and St. Emilion concentration and fruit from low There is every reason to believe
reached triple digit status. yields will give most of these wines that news in the following weeks
(The 19 100-pointers are: Latour, incredible appeal in their youth, but will centre on price hikes for 09
Léoville Poyferré, La Mission Haut-
Brion, La Mondotte, Montrose, Pavie, “In short, 2009 is the greatest vintage I have
Pétrus, Le Pin, Pontet-Canet, Haut-
Brion, Pape Clement Blanc, tasted in Bordeaux since 1982, of which it is a
Smith-Haut-Lafitte, Beauséjour modern-day version, but greatly improved.”
(Duffau Lagarrosse), Bellevue
Mondotte, Clinet, Clos Fourtet, Cos at the same time will guarantee that Bordeaux, particularly from châteaux
d’Estournel, Ducru Beaucaillou and the top wines last for 30 or more such as Cos d’Estournel, Smith-
l’Evangile.) Other high-scorers were years, as the best 1982s have Haut-Lafitte, Montrose, La
Margaux (99), Lafite (99+), Cheval certainly done. Mondotte and Clos Fourtet, which
Blanc (99) and Mouton (99). “I do want to reiterate that for as are not normally the most talked
Parker has always lauded the big, rich, and as high in alcohol as about names on the market and
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They are rich, sexy,
opulent and in the best
examples, offer decadent
those 100 point scoring
more with more room to appreciate
quickly as a result.
However, it is our view that
consumers and investors alike will
be fighting to buy not only the top
scoring wines, but the numerous
2009 Bordeaux wines. Based on
activity within the market place,
2009 Bordeaux will quickly become
the most expensive vintage in As we have reported, 2009 decadent drinking experiences.
Bordeaux history! Bordeaux are a wonderful style of Congratulations to those 100
Don’t kill us. We’re just the wine. They are rich, sexy, opulent point scoring Bordeaux
messenger. and in the best examples, offer Chateau!!
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Bordeaux - Issue 2: May
Bordeaux - Issue 1: January 2012 | 11
Bordeaux Fine Wines Ltd
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service that is only available to a selection of our most valued
clients. It offers a unique package of benefits to ensure that
you fully capitalise on holding a portfolio of fine wines with
Bordeaux Fine Wines.
As a premier client, you will have access to the following benefits:
A Dedicated Portfolio Analyst
Build Loyalty Points
Free Lifetime Insurance on Wine
Free Lifetime Storage on Wine
Free Transfer on Wine
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First Refusal on High Scoring Wines
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Client member, please don't hesitate to call us on 0207 127 5255
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