America Loves Bordeaux. Just Not Bordeaux Futures

The 2018 vintage shows great promise, but with prices high, U.S. consumers are increasingly waiting for the wines to hit store shelves
America Loves Bordeaux. Just Not Bordeaux Futures
A handful of estates, like Château Figeac, are enjoying success with futures in America. Most are not.
Apr 4, 2019

Bordeaux is preparing for its latest futures campaign, the first chance to buy the 2018 wines. But while the Bordeaux Wine Council says America is one of its priority markets, U.S. retailers tell Wine Spectator they expect little demand from consumers.

"I've never experienced such little interest in my 40 years here," said Ralph Sands, senior wine specialist and Bordeaux expert for California chain K&L Wine Merchants.

Bordeaux is hosting its annual barrel tastings for wine professionals prior to the wines' being sold as futures, 18 months before delivery. Wine Spectator's lead taster for Bordeaux, James Molesworth, has spent two weeks in the region, meeting producers to discuss the vintage's character and quality, and conducting blind tastings of more than 280 barrel samples. The wines show great promise.

Wine Spectator website members can check out James Molesworth's preliminary scores and tasting notes for the top 2018 Bordeauxs; his reports on more than a dozen visits to top châteaus are free to all.

But in recent years, the futures have largely failed to sell-through to consumers, leaving négociants and retailers to hold them until the wines are released. And there's no indication that this year will be any different. Major retailers around the U.S. report zero requests from customers for the 2018 en primeur offerings.

"No price drop will affect the market now," said Sands. "Unless prices drop so low that you feature it on the cover of the Wine Spectator and run a six-page story telling the whole world to jump off the couch and buy these great wines at unbelievably low prices, it's too late. Very few customers care anymore."

Bordeaux futures are in trouble

Retailers say several factors have led to this situation. Prices have risen sharply since 2005, which has scared some consumers away. And wine drinkers have an increasingly wide choice of regions and grapes to choose from, translating to increased competition for Bordeaux.

The slowing sales of futures means there is a large supply of excellent vintages like 2009, 2010, 2015 and now 2016 in the market. That offers little incentive for people to shell out cash two years in advance of delivery and several years before the wines can be enjoyed. With the exception of the most collectible of wines, the 2018s should be readily available when the wines are released.

Barbara Hermann, wine director at Binny's Beverage Depot, told Wine Spectator that she'd recently restocked her 2009s and 2010s. "I never thought I would go back and re-buy '09s and '10s, but I have, even at these new prices."

Under these circumstances, consumers are likely to be even more price-conscious, said Morrell & Co. CEO Jeremy Noye. "Prices will be the defining factor over quality. Quality will help drive it, but it's going to be hard for consumers to say they need the 2018."

There are a few exceptions, retailers say. There has been demand for futures in recent years from Château Figeac, Tertre Rôteboeuf, Lynch Bages, Léoville Barton, Pontet-Canet and Brane-Cantenac. Why those estates? Those wineries have invested years of promotion in the U.S., building their brands' reputations.

Check out Wine Spectator's "How (and Why) to Buy Wine Futures" for more on the benefits and pitfalls of en primeur purchases.

But Bordeaux wines are not in trouble

While the en primeur system seems to have ground to a halt—at least for American consumers—the demand for moderately aged Bordeaux is robust. "Bordeaux in general is on a steady increase," said Noye. "There's a good interest in the category and the price of California Cabernet has been skyrocketing, which makes Bordeaux classified growths look attractive, comparatively."

There has also been a small increase in demand for high-end, luxury sweet wines such as Château d'Yquem, Cuvée Madame from Château Coutet and L'Extravagant from Château Doisy Daëne, retailers report, a big change from the past decade. Demand for dry white wines remains that of a "niche" market.

But overall, the demand is for affordable reds. "The demand for good, everyday-drinking Bordeaux remains very strong for us, with three good vintages—2014, 2015 and 2016—to work with," said Sands. "Under $40 is where all the action is, with wines like Cantemerle, Poujeaux, Siran, d'Aiguilhe and Tronquoy-Lalande, and petits châteaus under $20, flying out."

Hermann at Binny's agrees. She says in certain markets, customers "are buying tons of Bordeaux—and French wine in general—from $8 and going up to $100 a bottle. The bulk of these customers' buying is $30 to $50, depending on the château and vintage." Hermann has also increased their selection of petits châteaus and second wines retailing for under $25. "It seems to be working."

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In fact, Bordeaux exports to the U.S. increased 21 percent in value last year, to $312.9 million, with a tiny drop in volume to 2.2 million cases, according to the Bordeaux Wine Council. That makes America the second-most important market in volume and third in value, behind China and Hong Kong.

"The U.S. is a top priority for Bordeaux wine," said Allan Sichel, Council president and négociant.

Of the 2.2 million cases, 2 million sell for under $40 per bottle. Those wines don't attract speculation, but they attract wine lovers. "There's a shift toward Old World–style wines," said Noye. "Bordeaux is one of the greatest regions in the world—it's stable and consistent. There are young wines that drink well and wines that age well."

This underlines that en primeur is one small but lucrative part of the Bordeaux business model. "En primeur is great, but it's only a tiny part of our business," said Sichel. "We want to drive the intermediate category. … We're making great progress."

Sichel says Bordeaux producers' end goal is even more ambitious: the region produces 2 percent of the world's wine. He says the industry's goal is to claim at least 2 percent of each wine market. Bordeaux currently only has 1.5 percent of the imported wine market in America. If the current lukewarm interest in en primeur is any indication, they'll need to find another means for raising their profile with American wine lovers.

France Bordeaux News Collecting

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