Four months before the Liv-ex 100 started falling in July 2011,
prices for Lafite Rothschild – the wine that had led the market’s bull run –
started drifting. Price drops increased when the 2010 En Primeur campaign saw
wines released at record prices.
The decline was not limited to the Grand Vin itself: other
properties owned by Domaines Baron de Rothschild also suffered. Prices for
Carruades de Lafite and Duhart Milon had risen due to their association with
Lafite; as shown in the chart below, they then fell along with prices for the
First Growth. Since Lafite’s peak Duhart and Carruades have fallen 44.0% and
46.4% respectively, compared to Lafite’s drop of 39.9%. By comparison, the Liv-ex
100 has fallen 25.8%.
Carruades and Lafite are now back to their February 2010 price
levels, Duhart to June 2010. Earlier this year, prices appeared to have
stabilised, but the last few months have seen them dip again. Do they still
have further to fall?