Bordeaux 1986

[Matthias R WHT]

The Bordeaux 1986 vintage – considered by many as one of the finest in
history – has perhaps suffered from being too much of a good thing.
The best wines of the vintage are notoriously tannic, brawny and
backward – and can be easily overlooked in favour of the more
immediately accessible.

Mouton Rothschild, rated 100 points by Parker and given a window of
2011-2096 – “a huge, monolithic, totally unevolved wine” – is perhaps
the ultimate example of this.

The good news is that nearly all the best wines from the vintage are
now drinking beautifully and have the added bonus of a long life ahead
of them. Neal Martin’s recent note (May ‘09) for Margaux 1986 is but
one example: he gives the wine a drinking window of now to 2020 and
describes it as “dense and structured” and “compelling” with a
“glycerine-rich finish with touches of damson and tobacco. Superb
length. Fabulous. 96 points.”

With many of the 1982s now hitting new price highs (most of which the
1986s will surely outlive), the time appears ripe for the vintage to
garner greater attention. Indeed, the price of the five First Growths
from 1986, in total, has increased 19.5% since the turn of the year
(Liv-ex Mid Prices, 31/12/2008 – 31/08/2009). If we benchmark this
against the performance of the Liv-ex Fine Wine Investables Index (of
which all five wines are a member) which has increased 11% over the
same period, we can see this is a very creditable performance.

This number does hide a wide variation in performance, however. As you
can see from the chart below, it has been Lafite 1986 that is in the
most credit, with the aforementioned Margaux 1986 in arrears.


1986 First Growths Price Performance

Label Price Movement 31 Aug to 31 Dec 2009 (Liv-ex
Mid-price)

Haut Brion 20.8%

Lafite 40.8%

Latour 5.6%

Margaux -11.3%

Mouton 19.8%


Margaux’s price fall is surprising. It is a wine that has always been
considered of exceptional quality – Jancis Robinson MW rates it on a
par with Mouton with 18.5 points – and it has recently benefited from
an upgrade from Parker, who awarded it 98 points (up from 96
previously), in The World’s Greatest Wine Estates (2005).

Nevertheless, if we compare the performance of Margaux 1986 against
that of Margaux 1996 – a vintage of similar quality – we can see it
has lost touch with its peer. Below is a graph of the two wines’ price
ratio over the last five years (the price of the first wine, divided
by the price of the second). We can see that despite the 1986 being
the more expensive wine for most of its lifetime it now trades at 15%
below the 1996, and is someway off its historical price ratio of 0.95.
(For more on price ratios, see the September Liv-ex Market Report)

If you are looking to pick up a 1986 and think the Lafite overpriced
(or feel the Lafite bull run is drawing to a close ) the Margaux looks
an excellent option. As well as being a very fine drop it would appear
to have the most potential upside. It is currently available at around
£3,500, which makes it the cheapest Margaux in the 98-100 score
bracket by almost £1,000.



- Liv-ex Fine Wine Market. 10 Sep 2009.