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Price, Not Quality, the Back Story at Bordeaux Primeurs
By Robert Whitley
Mar 23, 2010
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On the off chance you haven’t heard, our good friends in Bordeaux have experienced another vintage of the century. At least that’s the buzz.

For whatever it’s worth, I’ve lived through any number of these episodes, even before Robert Parker Jr. soared to fame and fortune by slobbering all over his keyboard as he discovered the extraordinary vintage of 1982.
Let’s see, there was 1978. Before that 1975 and 1970. And who could forget 1966, or ’61? Then there were the legendary Fifties – ’53, ’55 and ’59. More recently we’ve witnessed the outpouring of love for ’85, ’89, ’00 and ’05.

There is no doubt that all of these vintages were very good, or that they lived up to the hype. I don’t expect 2009 to be any different. In a few days I will have the opportunity to see for myself as I taste through hundreds of barrel samples from Bordeaux’s most recent harvest at the annual Bordeaux Primeurs for trade and press.

I’ve learned from experience that the best way to assess the vintage while attending Primeurs is to pay attention to the lesser chateaux. Latour, Mouton and Cheval Blanc never fire blanks. Regardless of the circumstances, they will make extraordinary wine.

The top estates not only have the finest terroir, but the wherewithal to produce second labels that can absorb whatever fruit fails to make the final cut. Combined with the technical expertise of modern viticulture and winemaking, the top classified growths of Bordeaux have become nearly fool proof.

But only in the great years do the less professional, more rustic operations produce superb wine. That’s what I will be on the lookout for next week, and I can hardly wait. That’s also where the bargains, such as they are, will be lurking.

And pricing will be the back story all week as the world waits to see how the Bordelaise handle an outstanding vintage in the midst of a worldwide economic crisis. In better times, prices might rise 30 to 40 percent, as they did in 2000 and again in 2005.

The question of the hour is how much of a hike the markets can take when resistance to expensive wine is at an all-time high. Could the roaring Chinese economy possibly prop up the price of Bordeaux by taking positions that American won’t or can’t?

The purpose of this exercise at Primeurs is to sell “futures” on the 2009 vintage. After three consecutive vintages of lesser repute, and thus flaccid demand for futures, the Bordeaux trade is primed for robust sales of Primeurs offerings. For the uninitiated, a futures contract is paid in full at the time of the sale even though the wine will not be delivered for at least two years.

Thus the highly touted 2005 vintage was delivered to distributors in the United States just as the housing crisis exploded. While some of those futures had been pre-sold to Bordeaux collectors and connoisseurs, much of it was purchased speculatively, meaning the distributor or retailer paid what was already a steep futures price on the hunch they could resell those wines two years later at an even greater price.

At least that was the plan. What will be curious this time around is whether or not the U.S. trade is willing to once again take a plunge – or the proverbial bath, as it were – on yet another “vintage of the century.” Will any perceived reluctance or lack of enthusiasm by U.S. and U.K. buyers have a moderating influence on the merchants of Bordeaux?

My hunch is that Bordeaux negociants will bet the farm that we are coming out of the recession, and prices will soar. What I’m not so sure about is the U.S. wine trade. It has grown extremely wary of expensive wines.

Restaurateurs don’t want them, the guy with one or two boutique wine shops doesn’t want them, and even many longtime collectors don’t want them, even though their investment portfolios may have bounced back with the rebound in the stock market.

Factor in the uncertainty over the Euro, the looming default of Greece absent a European Union bailout, and the potential domino effect if Greece goes down, and any sane person would conclude a major price hike on the ‘09 Bordeaux won’t be in the cards.

Call me crazy, but I think otherwise.