Blame it on the "Global Recession", ever-improving wines from other countries, or two great vintages in '95 and '96. Personally I like to think that the wine consumer has just decided not to put up with over-priced futures any more. For whatever reason, the Bordeaux wine "machine" has had to reassess it's own values with the '98 futures.
I'm 100% behind a hard-working wine maker being able to get a decent price for his wine. I realize that the various "middle-men" have to make a living too. And there's no reason why the consumer shouldn't be able to invest in futures if he wishes.
But when you raise prices by 15-50% for a product that's inferior to the previous year, things are out of line, and the good old free market will eventually correct the situation. This is why '97's are still sitting in negociants' warehouses and why the '98 futures are a good buy.
1995 was a great Bordeaux vintage, and vineyards sold their futures at a fair price, modestly above previous years. By the time the futures reached the retail level these prices had been hiked by the various middle-men by anything up to 200-300%.
1996 came along and the producers thought they might as well charge more themselves - anything from 15% to 35% - but this was again a great vintage, and there was no trouble selling the wine.
Along came the '97 futures …. Despite claims of great success form everyone in Bordeaux, this was clearly a lesser vintage then the previous two. This year it was the turn of the wineries to hike prices - by up to 50%! The negociants bought it - at least some of it - and now they're sitting on lakes of wine they can't sell.
So this year everyone gets to ruminate on the effect of too much greed, and the consumer gets a very good vintage at a price that's at least a bit more fair. 1998 futures are generally around 15-30% LESS than the '97's. Good for us - let's buy some '98 futures - from what I've tasted so far here in France it's a keeper!
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