En Primeur week is in full swing in Bordeaux with thousands of wines out of the barrels for tasting by journalists and buyers who will guestimate the quality and aging potential that determine the price of the Futures. Subhash Arora who was present at the opening; sipping and spitting scores of wines, reports from Bordeaux

En Primeur has long been a fascinating week for wine connoisseurs, journalists, critics and buyers alike. Bordeaux is all dressed up with the wines of the latest vintage, ready to impress the tasters and critics with their wines.

'We tried keeping various slots of a week for these tastings but felt that the first week of April worked the best for every one interested in Bordeaux wines,' says Patrick Maroteaux, the President for the last 8 years of Unions de Grands Crus.' He adds, 'drinking less to focus on subtle flavours rather than quantity brings connoisseurs together around the world.'

Prices

It is too early to predict the prices for the 2007 futures. The road-show has just begun. Uncle Bob (Robert Parker) was in Bordeaux later part of last week and has done his tastings. Other wine critics and writers like Jancis Robinson, Serena Sutcliffe, Team Decanter, Joel Payne, President of Fijev and many other well-known journalists were doing the rounds this week, rushing from chateau to chateau and many other tastings being organised under one umbrella.

It is almost sacrilege to predict the prices before the tastings are over. Chateau owners would like to sell at prices higher than the previous year, even when the earlier 2005 had hit through the cellar roof. But the ground realities are well known to the old hats. The vintage has been a good though much criticised vintage, more of a classic vintage than the exotic 2005 and not-so-exotic 2006.

Says Elis McCoy, a well known US journalist who penned the 'Emperor of Wine', the official biography of Robert Parker, 'U.S. retailers are not rushing this year. Many of their customers had been well-invested in the 2005 and to a lesser extent in 2006. One retailer who bought futures worth $5m in 2005 was able to sell them off quickly even though the customers complained about astronomical prices. He bought only $1m worth last year and is skipping the En Primeur completely.

Sherry Lehmann, a well known up-market New York retailer is not rushing to the annual 'Show' either. He will take his time to decide, though he will ultimately buy. But the retailers are finding it hard to find customers this year due to many factors.

Reasons are not hard to find. Last year, the dollar was trading at about 1.32 to a Euro. This year, it is at around 1.58. A fall of about 20% in he value of the dollar implies that the wines would be that much more expensive, even if they were sold at the same price (in Euros) as last year. Add to that the uncertain US economy and you can well understand why the Americans will not be jumping the gun to buy. The situation is not much different in UK, though not as dismal.

Asia is not a significant En Primeur market, anyway, says Ch'Ng Poh Tiong, the well known wine writer from Singapore and the most knowledgeable expert on Bordeaux wines, east of Suez. 'Wine is not bought or sold in vacuum. We have to keep in mind the world economy. The whole world is passing through an uncertain phase. When the economies are booming, people tend to splurge on wines. 2005 was a good example of that. However, people are keeping the hands tight this time around. 'I have not seen any fireworks at the tastings, so far, anyway,' he surmises.

The producers are keeping a brave front, hoping that the fall would be negligible. Talking to delWine Pierre Lurton, the President of Premier Cru Supérieur Classe en 1855, Chateau d'Yquem said, 'I feel that despite many difficulties we had with weather this year, this vintage will be regarded as a better vintage than even the '05 or '06. But people may not appreciate the fact at this point. Skirting the issue of pricing, he did hint that there may be a slight drop in the price for the king of Sauternes wines.

Eric Larramona, Director of Lafaurie Peyraguey, a Premier Cru Classe Sauternes echoed similar sentiments. Producer of wines which are well respected and aging wines (I tasted a 1906 which was still fresh), the wines sell for a fraction of Yquem, which fetched more than 18 times its price in 2005 .

Nicolas and Christophe Baillencourt brothers are co-owners of Chateau Gazin in Pomerol, neighbours of the iconic Pétrus produce fine wines which are being imported by Brindco. Says Nicolas, our appellation being small has not been rated as such and we do not fetch the prices we deserve. But the quality has been as good for this vintage and we do not think our prices will be down.

Christian Seely the charming Director of many properties including the top second growth of Pauillac, Pichon Longueville told delWine that the issue of pricing is very complicated. 'Obviously, the pricing will be determined by the quality of our vintage we are very happy with the '07. But we have to stay in the price band decided by the market, a group of negociants.' He also added firmly but politely, 'Pricing should be done on a property by property basis; some do very well in a particular year. As a manager of a property we need to get the right price.'

Referring to their Pomerol property, he said,' our Petit Village property is coming along fine and has done better than last year. There is no reason why it should be priced less than 2006.'

The charade, it looks, will go on till the wine journalists, critics and importers of standing give there verdict. But this does remind one of the jobbers in the New York Stock Exchange who like to pay the lowest to buy and highest while selling to the buyer. The gap is narrower for the stocks with liquidity.

En Primeur are 'futures' and to some extent like stocks and shares. You buy a 2007 chateau wine, hoping it will appreciate substantially by 2010 when the wine is released. However there is an added incentive that even if there is no increase, or even a decrease, you would still have fine wine maturing in the cellar for self-drinking.

And if the wine is from a good chateau, it would insure a dwindling supply- even the châteaux sell of most of their wine in tranches before the wine is released. The demand will also increase if the quality gets better with aging as expected.

At the very least, you will end up drinking better quality wine and perhaps may still recover your investment, which always remains in a liquid rather than the paper form.

Subhash Arora
April 2, 2008