Despite setbacks, including lackluster performance in previous vintages like 2022, there's a growing awareness within Bordeaux of the need to address these issues head-on, according to The Drinks Business’ Bordeaux correspondent Colin Hay.
Key stakeholders, including leading courtiers and properties, are coordinating efforts to stabilize the market by synchronizing release pricing and timing. This collaboration aims to avoid past mistakes and draw on successful precedents from vintages like 2019 and 2008.
However, the situation in Bordeaux remains complex, with some négociants facing financial strain due to rising costs and stagnant market activity. The upcoming Bordeaux 2023 en primeur campaign is eagerly anticipated as a potential turning point, with hopes for a much-needed market boost.
Yet, uncertainties linger, including the final composition of many wines and the absence of influential voices like Robert Parker. As Bordeaux prepares for a critical campaign, its success hinges on strategic pricing decisions and effective market signaling.
Expectations for the Bordeaux 2023 campaign vary, with potential reductions in release prices and phased tranching to gauge market response. Regardless of the outcome, the campaign is likely to prompt a reassessment and recalibration of market dynamics.
Pace-Setting Price Setter
Opinions diverge on how Bordeaux should approach the release of the 2023 vintage. Some suggest an ambitious strategy, such as releasing early with a steep price reduction (e.g., 35% compared to 2022), positioning Bordeaux as a pace-setting price setter that could positively influence market behavior.
Timidity Comes at a Cost
Alternatively, a cautious approach of waiting to see how the market unfolds carries its own risks. Properties that delay their releases may miss the opportunity to capitalize on early momentum, potentially impacting their sales and market position.
Price Setting Must Secure Buyer Return
Determining the appropriate level of discount for the 2023 vintage is crucial. While a 35% reduction may seem significant, its effectiveness in stimulating demand remains uncertain. Current market conditions, including increased borrowing costs and ample discounted back stock, complicate decision-making.
Potential Demand Shifts
The underlying challenges facing Bordeaux's en primeur system are multifaceted. Rising borrowing costs, increased storage expenses, and a lack of market confidence contribute to the current predicament. Restoring confidence and incentivizing purchases will require concerted efforts from industry stakeholders.
In conclusion, the Bordeaux 2023 en primeur campaign represents a critical juncture for the fine wine market. Strategic pricing decisions and market responsiveness will play pivotal roles in shaping the campaign's outcome and the future trajectory of Bordeaux's en primeur system.
Source: The Drinks Business