En Primeur: Asia market ‘has matured’
This year’s en primeur campaign has been hailed a success by several Hong Kong-based wine merchants, with many Asian consumers having changed their buying habits to reflect personal consumption.
Speaking to db as the 2014 en primeur wraps up, Eric Desgouttes, general manager for Kerry Wines in Hong Kong and China, said: “What worked well for us were Left Bank First Growths. The price was right all across the board and obviously the weakened euro is helping tremendously. As always, there were a few missed opportunities as some of the prices released were just too steep and we’re starting to see more personal consumer investments which means they’re becoming more selective in what they want.”
The idea that buyers in Hong and especially, China are purchasing en primeur more for private consumption as opposed to gifting or for speculation was echoed by other Asia players with Jonathan Mather from ASC Fine Wines hailing 2014 as a “return to a more balanced market.”
“Before, we had a massive disconnect to the actual end consumer because in previous years, many of the purchases weren’t made by them,” he said. “But China has slowed down on this completely. There’s an emphasis on personal buying and consumers have matured quicker than the Bordelais think. They’re still on the lookout for the big names but are becoming much savvier.”
Desgouttes continued: “Customers have rallied since 2010 and 2011 and have really narrowed down their focus. Consumers used to buy 15 or so labels, seemingly at random but now it’s reduced to 3-5 key names – Mouton, Lafite, Petrus for example – so they’re staying loyal to the châteaux they love and trust.”
Jeremy Stockman from Watson’s Wines also agreed: “2014 was much better than 2011, 2012 and 2013 and I’d argue that 2010 was the perfect storm which has led to the bubble almost bursting. Wines were released at the highest prices they’d ever been and it coincided with the time that Chinese consumers had just started to understand en primeur. Then the anti-austerity drive happened and you were left with some China wine merchants swimming about with no end consumers and the same thing happened again in 2012.”
Speaking of the wines that really sold well this time around and all merchants were in unanimous agreement. The usual suspects which emerged at fairer pricing were immediately snapped up as well as Left Bank favourites, Ducru Beaucaillou, Margaux, Vieux Château Certan and Pichon Baron.
“Mouton and Lafite cleaned up,” said Mather. “There were also super Seconds from Lascombes, Palmer and Lynch Bages which people leapt on and Thirds including Calon-Ségur and Giscours. Sadly, there were still a lot of releases whose prices had not moderated but this also indicated that people are going on what they love as opposed to the big names.”
“Lynch-Bages, Pichon-Longueville Lalande and Mouton were all under €40 per bottle and went quickly,” said Desgouttes. “D’Issan was an unexpected favourite but at the price, customers thought what’s the risk?”
In reference to an earlier db article at the start of the campaign where it was suggested that Bordeaux needs to win back buyers’ confidence and other reports which suggest China is slowing down on buying, the merchants were still buoyant.
“There are 30 million wine consumers in China”, said Mather. “It’s the emerging middle class where interest is growing phenomenally and is definitely not abating. The market is solid and sustainable with plenty of opportunity for growth.”