Wine - First Growth

A Case Of Demand And Supply

So there I was, sitting with my motley friends, sipping a very smart Australian Shiraz (rated 98/100 by Robert Parker Junior at less than US$100, FYI) and moaning about the price of top-line French red. Not only were first growths a thing of distant and fond memory, but it was perfectly apparent that most of my favoured 2ème to 5ème classifieds were rapidly racing beyond my feeble financial grasp. It was all quite depressing. It is a common misconception amongst my colleagues that just because I have been involved in wine in various roles for many years that I must actually have some knowledge. Well maybe I have a little, but how could I answer their questions as to why the wine market had changed so dramatically in the past few years? Or, perhaps more importantly, what the future would bring?
I have heard many snippets and anecdotes that seek to explain the reasons behind the extraordinary price increases of first growth Bordeaux and their most favoured cousins such as Petrus, Ausone and Le Pin.
In no particular order, these include:
- New demand from the burgeoning Asian and sub-continent economies
- Increased demand from the uber-rich of Russia, Europe and the USA, seeking large allocations of no less than three “vintages of the decade” in rapid succession: 2000, 2003 and 2005
- Demand from a plethora of newly-formed wine investment funds furiously buying anything where they could get a significant percentage volume of vintage, this giving them the ability to dictate ongoing market prices
- Curtailment of production at the chateaux to bolster quality
All of these have no doubt had an influence, although none are likely to match the hyperbole attributed to them. None provide a complete answer.
Then it dawned on me. We have seen this all before in human history. From the manic frenzy for tulips in the 1700s (which, incidentally, was the basis for the world’s first en primeur or futures market) to the current squeeze on oil prices. It is all very simple: demand exceeds supply. I am not trying to be glib or cute. It is a fact.
However, unlike tulips or oil, where new fields create more supply, the 1855 classification essentially ensures that supply of our most beloved and revered Bordeaux cannot increase, no matter how many new vineyards are planted across the globe.
So where from here? Having read reviews of those who certainly know a lot more than I, the 2008 vintage in France is unambiguously ordinary—and that is being polite. Yes of course there are notable exceptions and rare jewels of excellence, but in general this is a vintage best left to others to buy.
Early indications from the negociants point to brave but inexplicable attempts to ignore quality and post prices at similar levels to 2006. Logic would dictate that this is unsustainable. Surely quality has to influence even the present surplus demand equation to moderate prices. If not, then first growths have gone the way of rare stamps and gold coins: never to be used for what they were intended but simply hoarded as alternative assets.
I hope not. We shall see.
In the meantime, those who actually enjoy drinking quality wine but are not billionaires will just have to become more knowledgeable and adventurous in their choices. There are many stunning and much more affordable wines available from many parts of the globe that are prized in their own countries but largely overlooked by Asian markets.
This column will present examples of such wines to you over coming issues. I hope you enjoy reading about them as much as I enjoy discovering them. Cheers!- Robert Rees

Robert is a founder of Wine Exchange Asia, serving customers in Singapore and Hong Kong. For more information please visit or write to

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