Rieussec ’09 Sauternes Holds Gains as Trading Volume Increases

The 2009 vintage of Chateau Rieussec, a Sauternes wine estate under the same ownership as Chateau Lafite Rothschild, is holding onto price gains amid increased trading volume even as its 2010s have fallen, Liv-ex data shows.

Three cases of 2009s sold for 275 pounds ($438) on Liv-ex on Oct. 29 and 10 more fetched 270 pounds each in the following two days, all within the range set in July 2010 as they started trading, according to data on Liv-ex’s Cellar Watch website. The 2010s are below their May 2011 level when they came to market.

The Liv-ex Fine Wine 50 Index, a benchmark for top Bordeaux red wines, fell 1.5 percent in October, its sixth month of declines in the past seven and extending a slide which has taken it down more than 5 percent since the end of March. Investors have been looking for wines from other regions to diversify.

“Bordeaux is still selling, but it has to be at the right price,” said Joss Fowler, Director of Fine Wine at London wine broker Fine+Rare. “These wines are going to start selling again once people think they have intrinsic value rather than speculative value.”

Sauternes from even top-classified estates typically commands lower prices than comparable Bordeaux reds, and has traditionally been drunk with foie gras or as a dessert wine, often limited to special occasions. “It’s not drunk in the same way that red wine is,” Fowler said.

Rieussec Trading

More than 20 trades of Rieussec 2009 have taken place on the exchange since the start of July at prices ranging between 250 pounds and 315 pounds a case. The 270-pound level at the end of October was 29 percent above the low for the vintage touched in November 2011 while 33 percent below the peak reached in September 2010 as Bordeaux prices were lifted by Asian demand.

Rieussec 2010 traded at 200 pounds a case in both September and August this year, matching its July 2012 level. That’s down 44 percent from its peak of 360 pounds a case reached in May 2011 soon after being released to the market.

Chateau Rieussec is part of a series of wine estates controlled by Domaines Barons de Rothschild (Lafite), which include Lafite and neighboring Chateau Duhart-Milon in Pauillac as well as Chateau L’Evangile in Pomerol and vineyards in southern France, Chile and Argentina.

Rieussec’s 2009 vintage is its second-most expensive of the 10 most recent traded years, lagging behind only the 2004, while the 2010 is one of the two cheapest in the same period, according to merchant data tracked by Liv-ex.

Noble Rot

The 2009 Rieussec was awarded 97 points out of 100 by Neal Martin in a February 2013 online tasting note posted on U.S. wine critic Robert Parker’s eRobertParker website, making it the highest-ranked Rieussec since the 2001 vintage on that measure.

Sweet wines from Sauternes and neighboring Barsac derive their flavor from grapes picked after the Botrytis cinerea fungus, referred to as noble rot, sets in and boosts their sugar concentration.

Rieussec is a close neighbor of Chateau d’Yquem, Bordeaux’s top-ranked Sauternes estate, which recently released its 2011 vintage after saying in December it wouldn’t produce any dessert wine from its 2012 harvest. That was because grapes failed to achieve the necessary level of rot last year following an abundance of rain. Over the past half-century Yquem also skipped production in 1992, 1974, 1972 and 1964.

2011 Vintage

The 2009 vintage of Yquem, being offered at 4,500 pounds a case, is the estate’s most expensive of the past 10 years, although lagging behind the 2001, according to merchant prices collated by Liv-ex. It traded on the exchange in July at 4,350 pounds a case, up from 4,000 pounds at the end of last year.

Yquem’s 2011 wine, the fourth-most expensive of the past six years, is currently priced by merchants above its 2008 and 2006 vintages, according to Liv-ex. “We sold a respectable amount of 2011 Yquem when it was released,” Fowler said.

Chateau d’Yquem is owned by Paris-based LVMH Moet Hennessy Louis Vuitton SA, the world’s largest luxury goods maker, which is led by billionaire Bernard Arnault. The wine estate is managed by Pierre Lurton, who also has responsibility for Chateau Cheval Blanc in Saint-Emilion.

Among dessert-wine producers seeing demand for the recent 2011 vintage is Chateau Doisy Daene, an estate owned by Denis Dubourdieu, professor of oenology at Bordeaux University, and run with his wife Florence and sons Fabrice and Jean-Jacques.

U.S. Market

“2011 is a special vintage because it was very well regarded in the U.S. press,” Fabrice Dubourdieu, who is technical director of the family’s vineyards, said in an interview in London. “There was a very high demand on that vintage in the American market.”

Doisy Daene’s 2011 wine is priced at 270 pounds a case, according to merchant data compiled by Liv-ex. That puts it close to the level of the 2010 vintage and above prices for the estate’s five vintages between 2004 and 2008.

Since 1990, the estate has also produced a concentrated wine in limited quantities and in selected vintages, called Doisy Daene L’Extravagant.

The 2011 L’Extravagant is being offered by merchants at 3,213 pounds a case, compared with 3,358 pounds for the 2010, according to Liv-ex data. A case of 2001 L’Extravagant sold for $2,952 at an Acker Merrall & Condit auction in Hong Kong in May, according to archived prices on Acker’s website.

Before it's here, it's on the Bloomberg Terminal.