EP tasting week – pomp, pamphlets, pressure
Along with most of the UK trade, we board the first Easy Jet flight from Gatwick to Bordeaux on Sunday morning. Bleary-eyed, there is a sense of nervous anticipation. Rumours have it that the wines have turned out better than expected. Word on the street is that producers are not shying away from the current state of the market. But once bitten, twice shy. The trade is savvy to the Bordelais marketing machine that will be operating at full clip over the coming days.
We head straight to the Ballande & Meneret tasting. A huge warehouse that is largely devoid of human life greets us. Stacks of 2021s line the tasting space, hoping for another day in the sun. We taste c.50 wines, organised by appellation, and mostly towards the lower end of the price scale. My impression is of quite a lot of green and unripe tannins. There were a few successes (Rauzan-Segla was a team favourite), but we leave fearing that the rumours of producers overcoming the ordeals of a tough growing season had been somewhat stretched.
Day two begins with a trip up the Left Bank to Saint-Estephe. Up first is Montrose. After the mixed bag at Ballande, Montrose confirms that some of those rumours are true – this is a very delicious wine. A quick hop skip and a jump over to Calon where we have a chance to chat with the team around the vintage, the market, and their plans.
In advance of tasting week, the Liv-ex Market Intelligence team (Market Analyst Sophia Gilmour, Data Analyst Alex Chisholm and I) had published our En Primeur book. This contained an opening ‘state of the Bordeaux market’ report and individual analyses on each major wine. We bring a copy of the book with us along with individual printouts of the wine analyses, which we hand out to each producer we meet.
When we show the data, the response is generally consistent insofar as there really does appear to be a willingness to support the campaign (for which read price at a level to get the pulse racing). There is also talk about reducing the number of negociants they work with. Among other things, we routinely ask:
- How many full-time employees do you have?
- What about producing more grand vin and less of the second and third wines?
- How much is one critics’ point worth to you?
- Will you release at a price that will make the 2024 the cheapest in the market?
In that very charming bordelais manner, our hosts manage to come across as both humble and confident that the market will come around to their will.
Day three begins with a drive to Libourne for the Moueix tasting, followed by a mind-altering sequence at Le Pin, Lafleur, Petrus, and lunch at Cheval Blanc. Possibly the most fascinating meeting of the trip, the Cheval team appear committed to releasing the 2024 at a ‘no-brainer’ price.
We take the last flight back to London for the Easter break and the anticipation of Pontet-Canet kicking things off next week.
EP campaign – hard work
At Liv-ex, we send our members real-time analysis of each major release. As the campaign begins, we hopefully ask each other the same question.
”‘Do you think Chateau X will do enough’?
The further the campaign goes on, the more inevitable the answer becomes:
”‘They’ll get close, but probably not do quite enough’.
En Primeur coverage has been too obsessed with the percentage increase or decrease from the previous year’s release. This makes for good marketing material and enticing news stories, but is largely insignificant. Moreover, comparing a decade of generally poor release prices to one another makes little sense at all.
The crux of whether a release represents a good buying opportunity is simple and boils down to one question:
- Are there less expensive back vintages of similar or better quality available in the market?
If the answer is no, then it could be a ‘buy’. You do need to factor in costs of carry, and with storage currently c.£15 per 12×75 a year, they are not insignificant. But in theory, as long as there aren’t cheaper back vintages, then the ‘buy’ is at least in play.
However, if the answer is yes, then the release cannot be considered a no-brainer ‘buy’. If there are multiple better rated and considerably less expensive back vintages available, then it really isn’t a buy.
Unfortunately, this year’s campaign has had few instances where there are no better back-vintage opportunities. Lafite and Mouton spring to mind, and Carmes Haut-Brion ascent continues. Otherwise it’s been a story of: ‘While the release price reduction is commendable, there are better alternatives available’.
It’s notable that, according to our members, even when the release has appeared a no-brainer buying opportunity, it has often been met by disengaged end consumers. Buyer’s apathy has taken hold, or as one more forthright traditional EP buyer told me:
”‘We’ve been ****** for too many years, why buy this middling vintage?'
It’s interesting that the frustration with the system has reached a point where participants from across the supply chain are now daring to put their heads above the parapet. As the first releases came out, UK merchants publicly told their customers that they had hoped for better prices. This is quite remarkable. There can’t be many other industries where sales emails will tell you that the price isn’t great.
Similar stories emerge from La Place, where negociants have not been shy of showing their dismay at prices they know won’t sell. Reportedly the courtiers are also shaking their heads in disbelief.
So what might the future hold?
Before the campaign kicked off, we had suggested that the small crop of 2024s represented an opportunity for producers to reset and price at a level that invigorates the market. While we’ll never know, it’s possible that there might not have been any price that would have lit the touch paper for this campaign . So what could 2025 hold?
We have to hope that 2025 is a beautiful and bountiful vintage. One that is cheaper for producers to make, and theoretically gives the trade an easier thing to sell. While still 12 months away, one would anticipate that the market will not stomach any price rises. It will have to be priced well below other back vintages. In a falling market, this is no easy feat, and one that might be hard to stomach. But that appears to be what producers will have to do. If the 2024 campaign felt like last chance saloon, then for some another misstep might well result in closing time.
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