Everyone Said It Was an Obvious Buy. The Numbers Say Otherwise.
Revisiting My First Prediction
I can hardly believe that I wrote the very first edition of In the mood for wine four years ago, which you can find below.
I won’t get too sentimental.
At the time, I had four subscribers—one of whom was me—and that first article attracted a grand total of eight new readers. So it’s probably safe to assume you haven’t read it.
It wasn’t my finest piece of writing, but I do think it offered a perspective that differed from the consensus.
The article asked a deceptively simple question: can wines from “poor” Bordeaux vintages still make good investments?
The very simple answer that I gave to that complicated question was that the release price should be much lower to reflect the shorter ageing window — that’s to say: if you wine can only age 15 rather than 30 years then price should really reflect that. Of course, adjusting the release price accordingly is no small feat and more recently came to the realisation that release price should probably best calibrated against the ajusted market price of similar vintages (as I explain here).
In that piece, I concluded that the 2021 En Primeur campaign would be a difficult sell. Broadly speaking, that proved to be the case. As Decanter reported, "sales decreased significantly compared with the previous year, with volume and value sales down by as much as 60% in a few cases." However, there were also notable bright spots, including the First Growths, as well as Lafleur, Calon Ségur, Les Carmes Haut-Brion and Cheval Blanc.
I wrote:
It was reported in Decanter that analyst group Wine Lister believes the Cheval Blanc 2021, with a recommended onward selling price of £395 per bottle (in bond), to be ‘an obvious buy’, noting that the release price was around 28% lower than current prices for the top vintages of 2019, 2018, 2016 and 2015. Is that a great bargain?
In fairness, I got part of the story wrong. Cheval Blanc 2021 was an obvious buy—for merchants. It sold extremely well despite my scepticism. But whether it was a good investment for the people who bought it is a different question.
Let’s look at what happened afterwards.
The chart below compares the ex-London release price (red) with today’s average retail market price in the UK (orange), using data from Wine-Searcher. The percentage shows the annualised unrealised loss for collectors who bought En Primeur and still hold the wine.
I annualise the returns because vintages have been available for different lengths of time. A 35% total loss on the 2018 has accumulated over many more years than a 13% loss on the 2023, making annualised returns a fairer comparison.
The 2021 vintage has been one of the worst-priced releases in recent history, with En Primeur buyers currently sitting on an annualised loss of around 10%. This, I think, is the more interesting point.
The campaign wasn’t a commercial failure because the wines didn’t sell—they did. The failure was that buyers substantially overpaid relative to what the wines were worth.
Whenever I mention this, someone in the trade inevitably reminds me that “people buy En Primeur for reasons other than investment. The main one is guaranteeing provenance.” Perhaps. Although I've always found that argument slightly curious. It seems to imply that buying from leading merchants on the secondary market doesn't guarantee adequate provenance—a rather surprising claim coming from someone within the industry.
In any case, provenance isn’t free.
If you bought En Primeur primarily to guarantee provenance, the chart above tells you exactly what that insurance has cost you. In the case of Cheval Blanc 2021, that premium has amounted to roughly 10% per year.
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Thanks, as always, for being here.
Sara
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Four years ago, there were four subscribers. Today, there are a few more—which is fortunate, because collecting this sort of data takes considerably longer than recycling the usual industry narratives. If you enjoy independent, evidence-based wine analysis (and the occasional dismantling of a well-worn cliché), I'd be delighted to have you as a paid subscriber. And if you think someone else would enjoy In the Mood for Wine, I'd be hugely grateful if you shared it with them too.
I’m guessing that these are unrealised gains ex-storage and fees too
What stands out is how easily strong demand gets mistaken for evidence of fair value. The wine sold, so the release looked successful—but that success belonged largely to the merchants, not necessarily to the collectors who bought it. I’m not convinced the market has become any better at separating scarcity and launch momentum from actual investment value. As long as the downside sits with the collector, what incentive does anyone else have to become more disciplined?