2014 Bordeaux En Primeur Suggested Release Pricing

2015-05-27

What will it take for consumers to buy 2014 en primeur? The vintage produced many very good wines, but it isn’t another vintage of the century. Whilst it is a vintage that is qualitatively superior to any of the preceding years 2011-2013, the wines are heterogeneous; it is therefore a vintage to buy selectively.

Many producers were not keen to compare 2014 to 2008, which does nonetheless seem to be its closest benchmark if one had to only select one vintage. There is freshness across the board, and when combined with the vintage’s inherent fruitiness, has resulted in many appetising wines with substance and character.

Some, such as Chateau Latour, did compare 2014 outright with 2008, and perhaps it’s little coincidence that they do not need to sell this vintage, given their withdrawal from the en primeur release schedule. Others pointed to the pretty, succulent nature of the vintage (at its best), reminiscent of 1983 crossed with the structure of 2008.

Looking at it purely from the consumer’s perspective, they are most likely to buy if this vintage is priced to a discount of around 20% versus current low market 2008/ 2006 prices. Here’s why:

1/ There are only two reasons to buy early: scarcity and price. Since scarcity is merely a relative term in Bordeaux where quantities produced are generally substantial, that leaves price.

2/ The consumer has traditionally played the role of stockholder for en primeur releases. There is no reason to assume the risk of tying money up early, losing its opportunity cost, and incurring storage charges unless there’s a strong financial reason to buy up front.

3/ 2014 is qualitatively at least as good as 2008 or 2006. Pricing en primeur using the last vintage as a benchmark is meaningless. Producers want to price the current vintage to a meaningful premium over the very poor 2013s, because it is much better. Merchants want the Bordelais to price to the same price as 2013 to win back confidence. Neither side is focusing on the correct data.

Much more meaningful is comparing to current market prices of vintages that are qualitative benchmarks, hence picking 2008 and 2006 best market prices as the basis for showing what consumers need to spend for a comparable level of quality.

So using Wine Owners’ Market Level pricing data for First Growths and our favourite wines this year, we’ve calculated, based on a 20% discount to current or recent best market prices for 2008 and 2006, what we think consumers should be paying in £ sterling for a 12x75cl In Bond case of 2014 en primeur.

Because prices fluctuate, we’ve taken market pricing from 3 months’ ago and also from this month’s market pricing of 2008 and 2006 vintages, and have taken the highest average of the two vintages sampled from 3 months’ ago and this month.

Based on this analysis we’ve calculated suggested £ sterling prices to consumers, inclusive of margins taken by the whole channel of distribution including merchants. These suggested 2014 en primeur prices sample only the First Growths and those wines tasted that we liked the most.