Lafite 2024 Is Fairly Priced

Can Lafite Lead Bordeaux Back to Pragmatism?

⚠️ A quick note to say that Lafite 2024 has been released at a fair price! ⚠️

Here’s why:

Release Price Context

The release price (£3,426) is below the current market price of any previous vintage (see Column D).

That’s a good start (but not enough)!

Adjusting for Cost of Carry

To make a meaningful comparison, I discounted each previous vintage’s current market price (Column H) back to today’s terms. I applied a "cost of carry" (Column D) that factors in historical Bank of England interest rates, storage, and insurance costs.

This calculation produces a "Discounted Market Value" (Column I) — essentially, the market price of each vintage if we adjust for the cost of storing it over the years.

Why Discount?
Because when comparing, for example, the 2014 vintage at £4,340 to the 2024 at £3,426, it’s misleading unless you account for the 2014’s 10 years of storage costs. When discounted appropriately, the 2014 and 2024 prices become much more comparable.

Looking at the data, Lafite 2024 sits at the lower end of the Discounted Market Value range.

Risks to investors

There are two main risks:

1. Cost of Carry Risk:
   The past decade’s average cost of carry was 2.7%. Looking ahead, the UK yield curve implies a 4.67% average interest rate, pushing the future cost of carry to about 6.7%.
   At that rate, if rates will stay “higher for longer”, a fair 2024 Lafite release price would be closer to £1,800 to break even with the 2014 vintage. The actual release price is roughly 90% above that level.

2. Vintage Quality Risk:
   There’s debate about how age-worthy the 2024 vintage will be. Jane Anson scored it 95 points — her lowest Left Bank score since 2013 (92 points), and on par with 2012. William Kelley gave it a 91-94 point range — also the Wine Advocate’s lowest since 2013 (90 points). The lower scores may shorten its drinking window.

Conclusion

• If you believe interest rates will stay "higher for longer," Lafite 2024 looks expensive.

• If you expect rates to fall back toward zero, it’s fairly priced.

As for wine quality, I think 2024 is priced appropriately — a bit above 2013 and broadly in line with 2014.

Honestly, the first two releases of this En Primeur campaign made me fear that top châteaux would simply ride out the storm and pass the burden onto smaller players (so much so that I wrote a piece titled “Is Wine Going Out Of Fashion?”).

But this Lafite release makes me hopeful that pragmatism will prevail.

Thank you for reading.

Sara

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