June 2005. Bordeaux, which boasts the most famous vineyards on earth, is multi-faceted.
The most prestigious vineyards in the world go hand in hand with the highest prices.
Prices of transactions in the generic appellations are falling.
How can this situation be analysed in a difficult context?
Sales of wineries have picked up since 2004, with a 19% increase in area and a 53% increase in value.
In 2004, nineteen sales were recorded for a sum of over 2 million euros, including 3 at over ten million euros in the areas of SAINT EMILION and the MEDOC.
These transactions alone explain the increase in the overall average price which rose from 70,924 euros per hectare of planted vines in 2003 to 90,789 euros per hectare in 2004.
The MARGAUX, PAUILLAC and SAINT JULIEN appellations, for example, reached the average figure of 457,000 euros per hectare.
On the other hand, several AOCs have remained stable, such as the LALANDE DE POMEROL, at 198,200 euros/hectare, SAINT-ESTEPHE at 233,500 euros/hectare, the HAUT MEDOC and the MEDOC at 68,600 euros/hectare.
The average at SAINT-EMILION stands at 228,700 euros/hectare, but for the satellite appellations, the initial transactions in 2005 indicate a drop in comparison to 2004 to 131,400 euros/hectare.
The drop in prices is even more noticeable in the generic appellations
Bordeaux red and Bordeaux white stand at 18,300 euros/hectare, the ENTRE DEUX MERS at 18,600, the COTES DE BOURG at 38,100, the COTES DE BLAYE at 27,400 and the GRAVES appellation has dropped from 45,700 euros/hectare to 38,500.
Will the drop that has been observed since the start of 2005 continue?
The difference will be less following a change in the attitude of the worst hit owners.
In the Bordeaux generic appellations, it would appear that growers prefer to pull up their vines to benefit from the premiums of 15,000 euros/hectare, depending on the relevant plots.
This notion is gaining ground.
We shall give you an update at our meeting in October 2005 on the web site www.francevignobles.com