Châteaux splash out – on their own wine
French scramble to prop up prices as the world's biggest trader sells stock
![](https://static.independent.co.uk/s3fs-public/thumbnails/image/2010/02/11/22/319052.jpg)
Your support helps us to tell the story
In my reporting on women's reproductive rights, I've witnessed the critical role that independent journalism plays in protecting freedoms and informing the public.
Your support allows us to keep these vital issues in the spotlight. Without your help, we wouldn't be able to fight for truth and justice.
Every contribution ensures that we can continue to report on the stories that impact lives
![Head shot of Kelly Rissman](https://static.independent.co.uk/static-assets/support-us/kelly-rissman.png)
Kelly Rissman
US News Reporter
Leading Bordeaux châteaux are scrambling to buy back their own wine from America to prevent a "fire-sale" by a dominant US trader from tipping the world market for luxury claret into free fall.
The world's biggest single buyer of top-price Bordeaux wines – DC&E, a US subsidiary of the British drinks firm Diageo – has been liquidating its entire stock of the most prized châteaux at discounts ranging from 30 to 60 per cent.
The "bargains" may not appeal to everyone. A case of 12 bottles of Chât- eau Lafite, from the excellent 2005 vintage, has been on offer in the US for "only" $9,900 (£6,300) a case, or $825 a bottle. This compares to $14,520 a case, or $1,210 a bottle, a couple of months ago.
Rather than allow the already suffering world market for the top clarets to "fall off the shelf", some of the biggest Bordeaux names are buying back their own wines for the first time in their history. Château Gruaud Larose has bought 2,700 cases of its own wine from 15 vintages going back to the early Nineties. Château Pétrus has also bought back a large part of the unwanted DC&E stock.
"When it was official that DC&E was stopping everything... we were immediately in contact," Jean Merlaut, the owner of Château Gruaud Larose, told the French news agency, AFP.
"I wanted to control the situation so that our other clients were not faced with competition from wines that were being sold off cheap."
The decision by DC&E (Diageo Château & Estate Wines) to withdraw entirely from the top-dollar Bordeaux market is a potential calamity to a French luxury-wine industry, which is already suffering from the recession.
DC&E has been the biggest single buyer of the most prized Bordeaux châteaux wines for more than 30 years. The company has sometimes been accused of pumping up the speculative bubble, which has seen the top claret prices rise tenfold since the mid-Nineties. The global economic crisis has brought a steep fall in the market for top Bordeaux in the US. True wine lovers have turned to good, but lower-priced, châteaux. Speculative buyers have disappeared or moved on to other commodities.
As a result, DC&E, like other traders, found itself holding millions of dollars worth of unsold stock.
Some Bordeaux châteaux and traders have been accused of helping to "burst the bubble" by pushing up prices too aggressively in the last few years. They were encouraged by the vast global demand for the 2005 vintage, which is reckoned to be one of the finest since the Forties. The 2006 Bordeaux was also good, but 2007 is reputed to be poor. DC&E has large stocks of 2007 vintage bottles from the best châteaux still on its hands.
Cut-price sales are expected to start in the next few weeks. This threatens to send the global market into a tail-spin – just as primeur (wholesale, pre-bottled) sales of the reputedly excellent 2009 vintage are about to begin.
"DC&E still has a huge inventory, thousands of cases; it's still on the market, hanging over our necks like the sword of Damocles," said Guillaume Touton, owner of another US wine trader, Monsieur Touton Selections. "The 2007 is basically unsellable. The American economy will not buy, drink and swallow this huge inventory of wine for years."
Subscribe to Independent Premium to bookmark this article
Want to bookmark your favourite articles and stories to read or reference later? Start your Independent Premium subscription today.
Join our commenting forum
Join thought-provoking conversations, follow other Independent readers and see their replies
Comments