I Heard It Through the Grapevine....

WINE TALK
1

…that the “speculative” Bdx wine producers (i.e., those top growths making money hand over fist over the past several years) are going to release their '08s at around 50% less than previous. This remains to be seen in the next several weeks, but, this morning I heard Château Angelus already released its price (to negociants) of their '08 at approximately 50% less.

It seems the April tasting yielded better reviews than expected…so we’ll have to see what the 1st growths do. Personally, I think 50% isn’t enough, given the increases in '00, '03 and '05, but, depending on what comes out, I may be tempted…

2

Will be interesting to see what the big houses come out with. Glad to see that they are reading the market and acting accordingly.

3

I’m a bit late in posting updates on this because I have a hard time being interested in this “en primeur” campaign, but the the first 2 releases were indeed Angelus and De Sales on April 6. Tax is VAT = 19.6%

Angelus: 70 euros + tax
De Sales: 9.90 euros +tax

In comparison last year Angelus was 115 + tax and De Sales was 10.50 + tax. Way back 99 De Sales was 13.80 + tax.

My 2005 futures prices “master post” (scroll down a bit) with the release prices of all 2005 Bdx. This post gives a good frame of reference since all the prices are consistent - coming from the same source as above and usually the best on the market. 2005 was the all-time high in price for most chateaux.

4

I may be even more enticing if the euro as predicted starts to slide vs the dollar.

5

I certainly wouldn’t mind that at all…

6

Don’t you guys know that the price of Bordeaux will NEVER go down? Get used to it!

7

Angelus released last week and no one bought it.

8

No economist, but the ECB seems to be doing every thing in its power to make this a reality…cutting interest rates to historic lows now.

I wish I knew what was going to happen b/t now and the summer…would make my barrel purchases from Europe much easier.

9

Daniel…If other houses see this trend, what do you think the houses/chateaus will do?

10

I would assume that we will see a MINIMUM of 50% redux from 2007 across the board. Angelus at 41% was clearly not enough.

11

Do you think that some houses will hold back their release in hopes of the economy turning around?

and If they did…would it destroy the futures market as we know it today?

12

I do not think that they can afford to at this point. 2006 sold OKAY, 2007 was nonexistent. They need to try to recoup some cash on 2008. Waiting one year to maybe see 10% increases is just not worth it.

13

I also understand that production volumes were materially down as well. Even if they do sell well (which appears unlikely), it’s tough times in Bdx again this year.

It’s a lot worse for those who didn’t take advantage of the situation in 2003 and 2005 - some châteaux brought up their prices to negociants by “only” 10%-15% in '05. Now, there is a lot of negociant pressure to go down much more than that.

14

Quantities from my sources are very small but it’s interesting to see that Latour is already sold out there (in comparison 07 HB is still not sold out and most the 06 FG didn’t sell out either).