Late last year, at a Sotheby's auction in Hong Kong, an anonymous Chinese phone bidder paid $232,000 each for three bottles of 1869 Château Lafite Rothschild, a Napoleon III era wine that was already maturing nicely when the Boxer uprising stymied European imperial ambitions in China. That price smashed the previous record of $156,450, paid in 1985 by the Forbes publishing family for a 1787 Lafite bottled for U.S. Founding Father Thomas Jefferson. Gasps were heard in the Hong Kong auction room, but what really shocked the wine cognoscenti was the $70,000 paid at the same auction, not for another rare trophy bottle of Bordeaux but for a case of 2009 Lafite a wine so young it has yet to be bottled. Prior to the auction, the much hyped 2009 vintage was being priced at around $18,000 a case. So the $70,000 Hong Kong hammer price represented a whopping increase of just under 300%.
Not since the winter of 1636 in the midst of tulip mania in Holland, where for a time bulbs traded for the price of houses has the price of a perishable product escalated so dramatically. "Overnight," says Jack Hibberd, research manager at the online fine-wine exchange Liv-ex, "long-term target prices increased to levels people didn't imagine were possible." Short term too: thanks to Lafite's halo effect, wine merchants around the globe are already marking up prices of Lafite's main Bordeaux rivals, including Latour, Margaux, Mouton Rothschild and Haut-Brion. The index of 100 top wines maintained by Liv-ex rose 40% in 2010.
Shades of a China-driven Bordeaux bubble? Perhaps. "Before the Chinese came along," says Robert Sleigh, Sotheby's head of wine for Asia, "the market was quite capable of absorbing all the first-growth wines. But now you have a major new player in the equation." Nobody is quite sure why China's megarich crave Bordeaux and Lafite in particular. One fanciful theory is that the King of Thailand credits Lafite with aiding his recovery from a bout of ill health; another is that Lafite sounds like the Chinese word for prosper. The truth is probably more mundane. "Lafite is easy for the Chinese to pronounce," says Sleigh. The Lafite branch of the Rothschilds has one of the few château websites in Chinese. Credit, too, the marketing skills of the folks at Lafite. Last October, they let it be known that bottles of their 2008 vintage would be embossed with the Chinese symbol for the number 8, which is considered lucky. Prices for the presold vintage jumped 17% overnight.
According to Robert Beynat, CEO of wine-trade show Vinexpo, Asian wine consumption, led by China, is growing at four times the global average and will make China the world's seventh largest consumer by 2013. Economic reverses in the region may yet sap demand, and counterfeiting could undermine confidence in the market. But for now, the main fear is not that Chinese demand will cool but that China will price the rest of the world's wine lovers out of the top end of the market. Last year, more fine wine was sold in Hong Kong than in New York City and London put together, and by some estimates 1 in 4 bottles of the world's greatest wine is now in Chinese hands. No wonder the Chinese state-owned investment company CITIC is partnering with Lafite to plant vineyards in Shandong province with an eye to future growth in demand. Whether the claret craze will last is anyone's guess. As Dutch growers can attest, tulip bulbs change hands these days for a pittance.
This article originally appeared in the March 14, 2011 issue of TIME.