The great wines of Bordeaux completely dominate wine investment. Investment opportunities exist in other French regions namely Burgundy, the Rhone and arguably Champagne, as well as a selection of new world regions such as California and Italy. However, no other region offers the same investment perspective, or luxury brand status as the great estates of Bordeaux.
Bordeaux and market trading
It is instructive that the liv-ex 100, which takes a broad basket of the indexes 100 most investable wines, consists of 95% Bordeaux. 61% of Liv-ex’s overall trade is concerned with the five left hand bank 1st growth estates of Lafite, Mouton, Latour, Haut-Brion and Margaux. Moreover, Liv-ex evaluate that 94% of the wines they trade are Bordeaux Blends, meaning they predominate with the traditional Bordeaux grapes of Cabernet Sauvignon, Merlot, Petit Verdot and Cabernet Franc. This suggests that the Bordeaux blend, or style is a brand in and of itself. The pertinent question is why is Bordeaux so dominant?
The pertinent question is why is Bordeaux so dominant?
In 1855 Napoleon III requested a classification of France’s best Bordeaux wines, based solely on price. This classification led to the commoditisation of Bordeaux wine by creating a recognised ranking. Incredibly 150 years later this still stands, providing the most straightforward way to rank wines and it takes pride of place as the world’s most famous wine catalogue. It speaks of tradition and prestige and in many ways has become self-fulfilling, providing constant exposure and most importantly, an almost constant stream of income to these select estates. This has allowed them to consistently push the boundaries of quality. In turn the great estates have become highly regarded for consistent production of an extraordinary quality.
One must consider the majesty of these single vineyard Chateaux, which unlike many other French wine regions did not struggle with inheritance laws, forcing families to split inheritance evenly amongst their children, thereby dividing land into smaller and smaller plots. Instead, the Grand Cru chateaux are breath-taking aristocratic displays of architecture, adding to their prestige and desirability and providing a ready marketability.
Finite production capacity
It seems that Grand Cru Bordeaux wines benefit from their limitations. Finite production capacity created by natural boundaries, France’s Appellation d’origine contrôlée (AOC) and a constant decrease in production has created a supply shortage. While some right hand bank St-Emillion and Pomeral vineyards have production of under two thousand cases, the Left –bank Grand Cru’s have naturally arrived at a seemingly perfect production balance, ranging from Ch.Haut-Brion’s 12,000 average cases a year to Ch.Lafite’s 25,000. Rarity has been key to Bordeaux’s allure, however, it is important that sufficient quantities of this wine remained in circulation to meet the greater part of demand, thus allowing the brands to grow without having too little presence that would hamper the wines global performance.
Climate and terroir
Bordeaux has a maritime climate, which means it has a low annual range of temperatures, with warm summers and mild winters. It is a marginal climate and this means grapes need a good site and a good year to ripen fully, particularly in the case of Cabernet Sauvignon the thick-skinned late ripening grape that dominates the Grand Cru blends. Most great estates can boast extraordinary Terroir, being advantageously located on the great banks of gravel washed down from the Pyrenees during the ice age. This free draining gravel, mixed with sand, heats during the day and keeps the vines warm at night aiding the ripening of Cabernet Sauvignon, normally a warm climate variety. The gravel mounds raise the aspect of the vineyard, aiding drainage and sun exposure. The subsoil consists of clay, which holds water for the roots, causing them to struggle to reach the deep-water basin. This is particularly evident in St. Julien and Pauillac helping to create the concentrated blackcurrant fruit, powerful tannins, cedarwood, pencil shavings and cigar box characters.
Weather conditions greatly affect Bordeaux. The region thrives in hotter years when the grapes can reach optimum ripeness, aided by variable rainfall and dry conditions at harvest. In poor years wines can be harder with duller fruit flavours. This has a huge effect on price development with celebrated vintages like 1961, 82, 2000, 05 and 09 creating huge hype, media focus and global interest. It adds a level of nuance and the variation enhances interest, accentuating the magnetism of Bordeaux.
A unique combination
The golden bullet is that these are arguably the longest-lived of all wines. In great vintages the grapes ripen in their own time, not over-baked by the sun and combining superb concentration of fruit with nuanced minerality and flavour complexity. The big tannins of the Cabernet Sauvignon protect the wines during their decades of ageing and Merlot adds body, finesse and velvety mid-palate, making the blend more than the sum of its parts. For those who have patience, a 30-year-old aged Grand Cru Bordeaux provides minutes of pleasure from every sip. Just like its region an aged bottle of great Bordeaux is a combination of factors that seems, at least for the time being, impossible to recreate.