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Bordeaux en primeur 2020: what to expect

Well-priced wines will find a market, so what can the trade expect from Bordeaux for this year’s en primeur campaign – Liv-ex presents its view.

Bordeaux in barrel at Château Montrose

Liv-ex, the global marketplace for the wine trade, has provided db with its thoughts on what could make this year’s en primeur for the 2020 vintage a successful campaign, as well as what could dent its performance.

Giving Bordeaux producers confidence in the potential demand for their wines are two key factors, according to Liv-ex: early signs from the critics suggest that 2020 is high quality, while an upsurge in demand for Bordeaux following the suspension of of US tariffs points to a renewed interest in the region.

However, there’s a further aspect to this year’s en primeur that means the Bordelais must be cautious with pricing. As Liv-ex point out, there is potential frost damage to the 2021 vintage, which might encourage producers to increase prices of this year’s offering, but they should be careful: the current market sentiment is “tentative”, it said.

Vintage quality

As Liv-ex point out, early signs suggest that 2020 is a vintage of high quality, though opinion seems split on how it compares to 2016, 2018 and 2019. Volumes are certainly smaller than all of these vintages; 2020 was one of the three lowest yielding vintages in the last decade, the others being 2013 and 2017.

The 2020 vintage comprised of a wet spring with quite high mildew pressure, followed by a long, hot summer and a harvest-time heatwave.

Similarities have been drawn to the 2016, 2018 and 2019 growing seasons; however, 2020’s final yield of 440m litres is about 10% lower than the two years that preceded it, chiefly because of the heat, Liv-ex has reminded db.

The Bordelais, along with other French winemakers, are becoming more adept at handling hotter vintages, however, concerns about the 2021 crop could affect the release and pricing strategy for this campaign as the 2017 frosts did on the cusp of the release of the 2016s.

Many early commentators have remarked on the potential for excellent wines but also on what is likely to be a high degree of heterogeneity from appellation to appellation, and châteaux to châteaux, according to Liv-ex.

Demand for Bordeaux

Since 4 March, the US tariff pressure has eased, which has driven a renewed interest in Bordeaux; the region increased its market share to 41.6% by mid-March, up from 33.2% in January, Liv-ex recorded.

Justin Gibbs, Liv-ex director and co-founder said, “The recent lifting of the tariffs has had a marked effect on activity – leading to a strong kick in demand for wines of all regions, including Bordeaux.”

Trade has also been boosted by recent critical reviews of the in-bottle 2018 vintage, which has become the second-most traded vintage by value year-to-date, only surpassed by the classic 2009, whose trade has increased, due – Liv-ex noted – in part to its association with this year’s Lunar Year of the Ox.

Market conditions and en primeur

Last year’s campaign ended up being a surprise success, though a limited one, recorded Liv-ex. With the physical event cancelled, the Union des Grands Crus de Bordeaux sent out hundreds of samples to the trade and critics. The piecemeal nature of tasting by samples meant it took a while for the full picture to emerge, but the scores were high. Prices were also lower than for the 2018s, volumes were limited, and the vintage found a ready market.

While demand was narrow, it proved that well-priced wines will find a market, it said.

“The campaign’s success demonstrated that there is a willing market out there ready for the magic of Bordeaux – the producers simply needed to seize the opportunity,” commented Gibbs.

The 2020 campaign faces similar conditions, this time with the added complexity of severe frosts affecting the 2021 crop and Brexit — wine samples will now be subject to additional paperwork and customs duties.

The possible consequences

Price increases are a real possibility, in light of the smaller yields and the news of potential frost damage to 2021, believes Liv-ex. Critic scores, delivered in a timely manner, will be key to determining at what pace the campaign unfolds.

Success, as ever, will be determined by perceived value against the wines available in the physical market.

This is an en primeur campaign with a lot of moving parts, observed Liv-ex. The tastings, scores, releases, prices, length and pacing of the campaign are always co-dependent to a degree, but especially so this year.

And finally… a Catch 22 for the Bordelais? 

Until scores are distributed and a better understanding of the vintage’s qualities begins to form, keeping prices within orbit of the 2019s is surely the most sensible option, commented Liv-ex.

A further danger is that prices are attractive, but the châteaux continue to reduce the amount of stock they release, in what is already a small vintage, frustrating buyers, both regular and new.

Market sentiment towards Bordeaux is showing signs of a recovery, but recovery is nevertheless tentative. There are still many wines from past vintages that are widely available at discounts to their initial release prices.

Liv-ex concludes that in order to keep buyers engaged this campaign, the Bordelais can ill afford to put a foot wrong. Should they do so, may quickly squander the reserves of goodwill that were recouped in 2020.

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Bordeaux en primeur 2020: The négociants’ perspective

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