2017 Bordeaux – Don’t Bother

En-Primeur Bordeaux is always a difficult subject.  To evaluate the new vintage you need to taste a large number of wines that are only half made and no where near ready to taste properly.  The final blends may change slightly and the wines will continue to evolve for another year to 18 months in barrel.  You also need to be able to project each wine’s development forward a few years in your mind and make an educated guess at what it might be like after a few years in bottle.  Some people are pretty good at this, most are not.  Most people have to rely on scores supplied by well known wine critics, whose opinions can also be variable and may or may not match your particular taste preferences.  Any evaluation of quality needs to be balanced against an assessment of whether the release price is reasonable.

Buying Bordeaux EP is not automatically a good deal and hasn’t been for years.  The Chateaux, Negoce and UK merchants would like you to believe otherwise because it is big business, worth billions for them and a massive percentage of their annual turnover.  Selling wine EP also provides them with free financing at your expense!

Make no mistake buying wine EP is a risky transaction and you should be rewarded for your investment.  It is a futures transaction which would not be allowed on a financial exchange.  You give money now for an ill-defined product, which is in the process of being manufactured and which you should receive at an undefined point in approximately 2 years time.  The obvious risks are: Product risk – the wine may not be what you thought it would be.  Credit risk – will the Chateau, Negoce, merchant still be around in 2 years time?  (Many went bust between 2009 & 2012)  Delivery risk – is the wine coming directly from the Chateau, Negoce to your bonded warehouse?  A lot of wine is traded in the secondary market and has to travel all around the world for physical delivery of every transaction, there is not a centralised clearing house to match and offset trades.  There is also financial risk, opportunity cost of forgone alternative investments, exchange rate risk, market risk of the wine market in general and specific price risk of each wine purchased.  Wine prices go up and down like any other commodity.  Finally, the risks of fraud, either of fraudulent wine or dodgy wine merchants or investment companies.

How should you be compensated for assuming these risks?  At the very least you should be confident of a return on your investment at least equal to alternative investments of a similar risk profile available at the time of EP release.   Otherwise, you should simply invest your money elsewhere and buy the wines you want when they are actually available.  Why should you hand over your hard earned cash now for wine you may or may not get in the future, which could be worth significantly less if and when you receive it?  The only rational answer is that you don’t think you’ll be able to get the wine in the future.  This is rarely the case in Bordeaux but there are a few examples of  wines made in very limited quantities, which can be difficult (not impossible) to get when the wines are physically available.   They might just be a bit more expensive.  Don’t forget that even the First Growths in Bordeaux make thousands and thousands of cases of wine each year.

There have been very few vintages worth buying EP in Bordeaux this century.  Only 2004 & 2008 were released at prices attractive enough to justify the risks associated with buying EP.  Incredibly, no one wanted them initially, as they were thought to be average to slightly inferior vintages.  I was selling spare stock of 2004 First Growths at £980 per dozen at the end of the campaign!  Those wines are now worth 3-4 times that.  Late higher scores for the 2008’s from Robert Parker (substantially higher than everyone else) and the 2008 lucky number effect saved that campaign.  Both vintages have turned out to be very good investments and lovely wines to drink.

It seems that most people get caught up in the hype and loose all sense of perspective.  For me, the 3 best Bordeaux vintages this century are: 2005, 2009 & 2010, but all 3 were released at horrifically high prices and you could have bought them all cheaper after the wines were been released.  I told people not to buy 2010 Bordeaux EP but they still filled their boots and most are still substantially under water.  Even 2009’s, which I think are the greatest EP wines I’ve ever tasted, are only now getting back to release prices for many wines and some are still well below the highs charged at the end of the campaign.  Take 2009 Lafite which traded as high as £15,000 per dozen but is now trading at around half that.

All of which leads us to the main question for today.  Should you buy 2017 Bordeaux EP?   NO!  The wines are too expensive, do not represent good value and you will be able to buy all you want (with a couple of exceptions) when the wines become physically available in 2019.  Those of you who are determined to spend your money now, should buy back vintages.  They represent better value, most have been re-tasted in bottle, so you know what you are getting and they are available now.  It is a “No Brainer”.