Consumable vs. Luxury Good

The Wine Berserkers Special Wine Guests program continues with Thomas Duroux of Chateau Palmer, October 22-27, 2012
Post Reply
Message
Author
User avatar
Kris Patten
GCC Member
GCC Member
Posts: 4307
Joined: February 1st, 2009, 6:25 pm
Location: Seattle

Consumable vs. Luxury Good

#1 Post by Kris Patten » October 21st, 2012, 9:16 pm

Mssr. Duroux,

In the last 20, and especially the last 12 years we have seen certain properties in Bordeaux marketed and sold more akin to a Louis Vuitton purse, or Lamborghini, as opposed to a consumable good that is cellarable and collectible and meant to enjoy with friends, family, and wine lovers.

How do you feel about Bordeaux having the perception around the world as being out of reach for wine drinkers, and only being on the table of the rich and elite? Along with how this has played into the increased amount of forgeries and fraudulent wines.

As a side note, 83 and 89 Palmer are two very memorable that stand out in my vinous experiences, what vintages from 1996 forward do you think will have the brightest futures at 20 to 30 years of age?

Thanks, Kris
ITB

thomas duroux
Posts: 41
Joined: October 22nd, 2012, 8:26 am

Re: Consumable vs. Luxury Good

#2 Post by thomas duroux » October 22nd, 2012, 8:41 am

Hi Kris

It is true that certain wines from the Bordeaux region are extremely expensive. I don't really think that they are marketed as luxury goods. I just think that the increasing demand around the world (China!!!) has created this fenomena.
Caviar is a consumable good, but it is hard to find...
I don't think this is just for Bordeaux. Cult wines from California or top Grand Cru from Burgundy are the same.

Best vintages from 1996 are (without surprise): 2000, 2005, 2009, 2010. But I would consider also 1998 (I love this vintage for Palmer, it is as you know a fantastic vintage for merlot and this grape variety is very important for us) and 2011 (smalest yield since 1961 and I am convince it will be a fantastic surprise for a lot of wine lovers in 20 or 25 years)

User avatar
Todd F r e n c h
Site Admin
<dfn>Site Admin</dfn>
Posts: 38612
Joined: January 27th, 2009, 8:46 am
Location: San Clemente, CA

Re: Consumable vs. Luxury Good

#3 Post by Todd F r e n c h » October 25th, 2012, 7:56 am

thomas duroux wrote:Hi Kris

It is true that certain wines from the Bordeaux region are extremely expensive. I don't really think that they are marketed as luxury goods. I just think that the increasing demand around the world (China!!!) has created this fenomena.
Caviar is a consumable good, but it is hard to find...
I don't think this is just for Bordeaux. Cult wines from California or top Grand Cru from Burgundy are the same.
Thomas, do you feel that worldwide demand (i.e. China) has caused the rise in price? Chateau Palmer wasn't always the equivalent of what price it is today, as I understand (when adjusted for cost of living, inflation, etc), so what determines the current price?
Apparently I'm lazy, have a narrow agenda, and offer little in the way of content and substance (RMP) (and have a "penchant for gossip" -KBI)

thomas duroux
Posts: 41
Joined: October 22nd, 2012, 8:26 am

Re: Consumable vs. Luxury Good

#4 Post by thomas duroux » October 26th, 2012, 7:49 am

Todd,
China and the strong demand for top wines of Bordeaux had an impact, no question about it. The worlwide demand has also increased. But an other thing that has to be considered is that our production volume is not the same. In the 80's and begining of the 90's yied were higher and selection lower (80 % of the crop in the grand vin). Nowdays w no more than 40 to 50 % of the crop goes into Chateau Palmer.
Higher demand, lower production means price increase.....

User avatar
Todd F r e n c h
Site Admin
<dfn>Site Admin</dfn>
Posts: 38612
Joined: January 27th, 2009, 8:46 am
Location: San Clemente, CA

Re: Consumable vs. Luxury Good

#5 Post by Todd F r e n c h » October 26th, 2012, 7:57 am

thomas duroux wrote:Todd,
China and the strong demand for top wines of Bordeaux had an impact, no question about it. The worlwide demand has also increased. But an other thing that has to be considered is that our production volume is not the same. In the 80's and begining of the 90's yied were higher and selection lower (80 % of the crop in the grand vin). Nowdays w no more than 40 to 50 % of the crop goes into Chateau Palmer.
Higher demand, lower production means price increase.....
With higher demand raising prices (I understand lower production - that goes without saying), is it simply because the market CAN bear higher prices, or that the wine MUST be priced higher? Assuming the former, I would assume that makes the winery much more profitable, no? OR does it just pad the pockets of the distribution/en primeur companies?
Apparently I'm lazy, have a narrow agenda, and offer little in the way of content and substance (RMP) (and have a "penchant for gossip" -KBI)

thomas duroux
Posts: 41
Joined: October 22nd, 2012, 8:26 am

Re: Consumable vs. Luxury Good

#6 Post by thomas duroux » October 29th, 2012, 4:11 am

Well the wineries decide the en primeur price based ont their understanding of the worldwide demand and then the market adjust the price. Less wine and more demand means that the market speculate. Yes the Wineries are more profitable and the result is that selection has never been so drastic and that a lot of investment in the production tools are made. I would also assume that the good distributors take an advantage of it but same think for them: less volume...

Post Reply

Return to “Special Wine Guests - Thomas Duroux (Oct 22-27, 2012)”