Is it time for a vintage revival?

Sales of rare wines at Christie's and Sotheby's highlight new interest in liquid assets, says Anthony Rose

It is unlikely that Christie's boardroom had seen anything quite like the array of rare wines that graced the elegant King Street dinner tables: eight wines from Château Latour starting with the legendary 1961 and working back to 1881.

It is unlikely that Christie's boardroom had seen anything quite like the array of rare wines that graced the elegant King Street dinner tables: eight wines from Château Latour starting with the legendary 1961 and working back to 1881.

This bonne bouche was a foretaste of their sale on 22 May, when 193 lots of Latour's greatest vintages of the past two centuries go under the hammer. Coincidentally, Sotheby's is holding its own sale of the century a fortnight later, on 4 June. Baron Frère, reputedly Belgium's richest man, is disposing of 6,000 cases, including many first growths, in aid of La Fondation Charles-Albert Frère, a trust fund established for his son, killed in a car accident in 1999.

The five first growths, Haut-Brion, Lafite, Latour, Margaux and Mouton-Rothschild, are the crème de la crème of Bordeaux, the world's biggest fine wine region. These solid blue-chips head the list of five dozen or so of the châteaux which provide the bedrock of wine investment. At an estimated £2,000-£3,000 a bottle, wines like 19th century Latour are far too rare and expensive for all but the most heavy-hitting international collectors. But over the past two decades, interest in fine wines has grown to the extent that Bordeaux and its ilk have become one of the sexier alternative investments.

En primeur is a system of selling fine wine as futures, developed by the top Bordeaux châteaux to avoid sitting on stock and to release cash flow. In the spring after the vintage, the wines are offered to consumers by specialist wine merchants at a price attractive enough to make the accompanying risk worthwhile. The risk lies in the fact that, at this early stage, a wine's future investment prospects are an unknown quantity.

Enter Robert Parker, the great panjandrum of wine writing. Helping to minimise the gamble, his journal, The Wine Advocate, backed by an unerring palate and a 100-point scoring system, is the investment benchmark. So much so that collectors hang on his words and châteaux on his scores before setting their opening prices.

As attractive as the idea of making money from wine may be, it would be rash to expect instant liquid gold. Or to put more than a small percentage of available cash into it. One of the motors of investment in the 1980s was the extraordinary string of successful Bordeaux vintages (1982, 1983, 1985, 1986, 1988 and 1989 were all good to great). Despite technological progress, Bordeaux was less fortunate with the weather in the 1990s. Only 1990, 1995, 1996 and 1998, in parts, were worth buying en primeur.

The Asian crash of 1997 also put a large dent in fine wine values and though the 2000 vintage came as a saviour, neither 2001 nor 2002 have been good enough to buy as futures.

In the auction room, the fine wine market, like housing, has been at a standstill this year. Hopes of a recovery this time last year were dashed by economic uncertainty and the prospect of war with Iraq. Decanter Magazine's Bordeaux index, which is based on prices fetched at auction by the top châteaux, fell from 118.96 last July to 116.85 this month.

Prices have started to pick up since the end of hostilities. In late May and early June, "the season" brings the big money into town, so the two forthcoming sales could turn out to be a badly needed shot in the arm for auctioneers and vendors alike.

One man who enjoys investing in wine is Stephen Marcon, 37, who works in the City and lives in south-west London with his South African wife and two children. He has always been interested in wine because "my father was a wine drinker and never drank beer". Six years ago he and a group of City friends set up a wine club. They meet regularly, tasting current and older vintages of, among others, Châteauneuf-du-Pape, Loire, Bordeaux, Alsace, Chablis and vintage Champagne.

Stephen then buys a case or two of those he likes, such as 1998 Vieux Télégraphe and Château de Beaucastel. Most recently, he has bought the 2000 Bordeaux crus bourgeois Châteaux Siran and Monbrison for less than £175 a case in bond. "I try to buy at least two cases of every wine, as you can sell a case if you open the first and don't like it, but if you buy only one and it's fantastic, you never have enough."

He feels that prices are currently too high for "great wines" and buying for investment has become harder. He thinks Robert Parker's influence on the pricing policy of Bordeaux châteaux has taken away an element of purchasing advantage.

His main recommendation is to buy lesser-known châteaux in great years, rather than great wines in poor years. And to acquire a couple of wine merchants who can be relied upon "as you need some leverage to get a few cases of what you want in great years".

In the absence of a dramatic upturn in prices, the saleroom still presents opportunities for buyers. The excitement over the high-priced 2000 Bordeaux vintage has made mid-range classified Bordeaux from good vintages like 1995 and 1996 look underpriced. The same applies to the 1998 vintage in St Emilion and Pomerol. Bordeaux remains the yardstick, but the smart money is looking for bold new challenges, in Burgundy and, to an extent, the Rhône and the up-and-coming icons of Italy, Spain, California and Australia.

But anyone serious about investing in wine should remember it is a time-consuming minefield. Storing it well and carefully is a must. So remember one failsafe piece of advice to provide motivation: buy your wines to drink, even if they can't be Lafite or Latour.

A drop of the right stuff?

Five of the best

* 2001 Chateau de Beaucastel (below), Chateauneuf-du-Pape, £23 (Farr Vintners) Fabulous Chateauneuf from a great vintage for Southern Rhône.

* 1996 Grand Puy Lacoste, Pauillac, £30 – £33 (Wilkinson Vintners, Robert Rolls) Brooding, well-structured, stylish but woefully underrated claret.

* 2000 Chateau Lynch Bages, Pauillac, £52 (Farr Vintners). Superlative fifth growth claret with concentration, class and complexity.

* 2001 Artadi El Pison, Rioja Alavesa, £55 (Berry Bros & Rudd) Amazing mix of black cherry fruit, oak spice and power.

* 1998 Haut-Brion, Pessac-Léognan, £97 (Wilkinson Vintners) A great, intensely rich and complex first growth.

Five of the worst

* 1997 Lafleur, Pomerol, £50 (auction) Massively overpriced when it first appeared, now on the way down.

* 1997 Chateau Le Pin, Pomerol, £215 (auction) Trading on its name but underwhelming and overpriced.

* 2000 Chateau Mouton-Rothschild, Pauillac, £253 (Berry Bros & Rudd) The least impressive of the first growths in 2000.

* 1999 Romanée Saint Vivant, Domaine de la Romanée-Conti, £394 (Berry Bros & Rudd). Normally a good bet but this average effort is the odd man out.

* 1982 Chateau Pétrus, Pomerol, £1135 (auction) Absurdly overpriced even by Pétrus standards given its lacklustre showing in 1982.

Information

Auction houses

* Christie's, 8 King St, London SW1 (020 7627 2707) www.christies.com

* Sotheby's, 34-35 New Bond St., London SW1 (020 7293 5000) www.sothebys.com/wine

* Bonhams, 101 New Bond St., London W1 (020 7629 6602) www.bonhams.com

* J. Straker Chadwick, Abergavenny, Monmouthshire (01873 852624) www.strakerchadwick.co.uk

Wine Merchants

* Wilkinson Vintners, London N19 (020 7272 1982) Wilkinson@finewine.co.uk

* Berry Bros & Rudd, 3 St.James's St., London SW1 (0870 900 4300). www.bbr.com

* Farr Vintners, Sussex St, London SW1 (020 7821 2000). www.farr-vintners.com.

* Robert Rolls & Co, London EC1 (020 7606 1166). Mail@rollswine.com

* Fine & Rare Wines, London W10 (020 8960 1995). www.frw.co.uk