Buying Burgundy En Primeur – The Process Explained

Published: 05-12-2018

Burgundy En Primeur Explained



Buying Burgundy En Primeur – The Process Explained

 

En Primeur refers to a process where wine is bought before it is even bottles, while it is still in cask in the producer’s cellars. Traditionally, En Primeur prices are the keenest prices as, in essence, it offers producers a loan to help them with their current harvest. It is also by far the best opportunity to securing sought-after and hard-to-find wines and unusual formats such as double magnums or halves. Once the wines are bottled and physically present in shops and wine merchants, it is virtually impossible to find the same price offered as during the En Primeur campaign. For a region like Burgundy, with many small producers, and wines that are increasingly harder to get your hands on, En Primeur is a win-win situation.

 

The origin of En Primeur

The En Primeur system traces its roots to Bordeaux where, in the aftermath of the Second World War, leading merchants agreed to buy wine from producers before it was bottled to give them in essence a cash-loan, allowing them to pay for the current harvest and frankly to survive. Bordeaux was a different place at the time, with many producers (aside from the First Growths) struggling to financially stay in business. By the 1970s, the Bordeaux market started to expand and the En Primeur system became available to private consumers through their merchants. Today, it is a system that is adopted widely around the world by other wine regions, including Burgundy, Rhone, Italy and even some new world regions such as California.

 

When is Burgundy En Primeur?

In general Burgundy En Primeur season in the UK is January, when all merchants release their prices and hold tastings. By this point merchants themselves and some critics will have sampled the wines so there is an abundance of tasting notes and vintage reports available.

 There is a Late Release Burgundy En Primeur for producers that don’t partake in the January release. For us at Stannary, these wines will be released in July-August and will include Domaine Dujac and Domaine Georges Noellat.

Allocations

Due to the tiny quantities of some of the wines combined with high demand, there is an allocation process for some of the wines in the Burgundy En Primeur process. Requests need to have been submitted by 15th January and we usually confirm them by the end of January. There is no exact science to the allocation process, but we look at previous support for the producer, a wide-spread interest in Burgundy and an interest in the vintage specifically.

 

How does it work?

  • The wines are sold while they are still in cask or bottle at the producer, this means that prices are always in bond (i.e. exclude duty and VAT, which will be payable on delivery from a warehouse). It can take between 6-18 months for the wines to arrive.
  • All wines are bought in full unsplit cases
  • On arrival in the UK the wines will be stored, under bond, on your behalf in our Customers' Private Reserves or delivered to your preferred address.
  • If you choose to have the wine delivered, the taxes (duty and VAT) will become payable
  • Due to the tiny quantities produced in Burgundy, some wines are sold on allocation. These are clearly high-lighted in our Burgundy En Primeur release. You will need to express an interest for these by the 15th January and we will hopefully have finished the allocations by the end of January.

 

What exactly do I pay?

Prices are quoted in bond, ex Duty and VAT, but include shipment and insurance. When the wine arrives in the UK, it arrives in a bonded warehouse. Duty and VAT are only payable when the wine is removed from bond. If there is a chance that you may re-sell your wine later, it is advisable to store the wine under bond.

 

Why Buy En Primeur?

  • En Primeur prices are traditionally the most attractive prices
  • It allows you to secure wines that may otherwise be difficult to get hold of
  • You are more likely to be able to find wines in all formats: half bottles, bottles, magnums, etc

 

The difference between Bordeaux and Burgundy En Primeur

  • Bordeaux and Burgundy En Primeur are two fixed calendar events for the wine-trade and their customers. Bordeaux en primeur tastings are held in April after the vintage (i.e. 2017 Bordeaux is tasted and released from April 2018) and wines are usually released between April and July, with each chateau releasing its wine individually. In contrast, Burgundy is usually released in January, two years after vintage (i.e 2017 Burgundy is released in January 2019).
  • The advantage of releasing Burgundy later is that the wine is nearly bottled, meaning that the tasting samples in general are a great representation of the final wines. In contrast, Bordeaux en primeur is tasted and sold after only a few months in barrel, meaning that the final bottles will have substantial more barrel ageing potentially altering the flavours.
  • Production in Bordeaux is much larger than in Burgundy with First Growths on average producing 8000-16.000 cases per year of the Grand Vin, while many Burgundians may produce 2000-4000 cases of wine across their entire production with only a few hundred cases of their top wines. As a result, there is more trading and therefore price fluctuation on Bordeaux than Burgundy. In essence this highlights two important aspects about Burgundy En Primeur: firstly, it may be the only way of securing stock (from the rare Grand Cru to the humble village wine) as the wine genuinely may not come on the market again. Secondly, the traditional reason that En Primeur prices are most likely the keenest prices remains true as well.   

 

Is there a risk involved?

Yes, in essence you provide a loan up front to the producer. It is therefore important to buy from reputable sources with financial stability. By buying directly from the importer is important as it

  • Reduces risk (less chance of failure in the chain between the producer and you as the customer)
  • Guarantee the provenance of your wine
  • Guarantee the best purchase price

 

If you're interested in joining us for our annual Burgundy En Primeur tasting on the 8th January, tickets are available here. Many of our winemakers attend with samples of their new vintage (2017s will be released this year) straight from the barrel. 

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