What is (Bordeaux) En Primeur?
And a list of pros and cons.
Bordeaux En Primeur, also known as Bordeaux futures, refers to the practice of purchasing wines while they are still in the barrel, prior to their official release and availability on the market. It is a system unique to Bordeaux and allows consumers to secure wines from a particular vintage before they are bottled and ready for immediate consumption.
En Primeur typically takes place shortly after the harvest, during the spring following the vintage year. Wine merchants and professionals, as well as individual collectors, have the opportunity to taste and assess the young wines from various Bordeaux châteaux. Based on these tastings and evaluations, the wines are then offered for sale by wine merchants and châteaux as futures.
Purchasing En Primeur allows buyers to acquire highly sought-after wines at potentially lower prices compared to their future release prices. It is often considered a way to secure allocations of limited-production wines, particularly from prestigious estates and highly regarded vintages. However, En Primeur purchases come with certain risks, including uncertainties about the wine's final quality, potential price fluctuations, and the need for patience in waiting for the wines to mature before consumption.
En Primeur wines are typically delivered to buyers two to three years after the initial purchase, once the wines have been bottled and are ready for distribution.
Advantages
Investing En Primeur offers several potential advantages for wine enthusiasts and investors. Here are some key advantages:
Access to sought-after wines: En primeur allows buyers to secure allocations of highly sought-after wines from prestigious estates, particularly in exceptional vintages. These wines often have limited production and high demand, making them difficult to obtain once released on the market.
Potential for lower prices: En Primeur prices are often lower compared to the eventual release prices of the wines. By purchasing early, investors have the opportunity to acquire wines at a more favourable price point, potentially benefiting from price appreciation as the wines mature and become rarer.
Potential for investment returns: If a vintage or a specific wine gains critical acclaim or increases in popularity over time, its value in the secondary market may rise. Investing En Primeur allows buyers to potentially benefit from the wine's appreciation in value.
Allocations and exclusivity: En Primeur purchases often come with the advantage of securing allocations directly from the châteaux or reputable wine merchants. This can provide exclusivity and access to limited-production wines that may not be widely available later.
Personal involvement and anticipation: Buying En Primeur allows collectors to be part of the wine's journey from the early stages, following its development and maturation over time. There is a sense of anticipation and involvement in the wine's story.
It is important to note that investing in en primeur wines also carries certain risks and uncertainties, such as potential variations in quality, market fluctuations, and the need for storage and patience while the wines age. Conducting thorough research and seeking advice from wine professionals can help mitigate these risks and maximize the potential benefits of en primeur investing.
Disadvantages
Investing En Primeur also comes with certain disadvantages and risks.
Here are some potential disadvantages to consider:
Uncertainty about wine quality: En Primeur wines are still in the barrel and have not yet been bottled. This means there is uncertainty regarding their final quality and how they will develop over time. Tasting samples during the En Primeur process provides an indication, but it does not guarantee the wine's ultimate character and potential.
Market volatility: The wine market can be subject to fluctuations and uncertainties, including changes in consumer preferences, economic conditions, and global events. The value of En Primeur wines may fluctuate after their release, and there is a risk that the market demand or perceived value may not align with initial expectations.
Long maturation period: En Primeur wines require significant time to mature before they are ready for consumption. This means that investors must be patient and willing to wait several years, or even decades, before they can enjoy or potentially sell the wines.
Storage considerations: En Primeur wines need proper storage conditions to ensure their optimal development and preservation of quality. This may require investments in suitable storage facilities, which can add additional costs and logistical considerations for collectors.
Allocation challenges: Acquiring highly sought-after En Primeur wines can be competitive, and allocations may be limited. Some wines may be primarily available to long-standing customers, industry professionals, or wine merchants with established relationships, making it challenging for new investors to secure desired allocations.
Lack of immediate access: Unlike wines that are already released and available on the market, en primeur wines are not immediately accessible. Buyers must wait for the wines to be bottled, shipped, and distributed before they can take possession of their purchases.
It is crucial for investors to carefully consider these potential disadvantages and assess their individual risk tolerance, investment goals, and market knowledge before engaging in en primeur investing. Seeking guidance from experienced wine professionals and conducting thorough research can help mitigate some of these risks.