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Chinese Buyers Opt Out of 2023 Bordeaux En Primeur, Citing Overpriced Futures

vino-joy.com by Morris Cai06/05/2024  

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This year’s Bordeaux En Primeur held from April 20-25 attracted some 5000 merchants, negociants, journalists and critics from around the world but what’s notably missing is the Chinese buyers.

Based on our interviews and observations, the absence or diminished presence of Chinese merchants compared with previous years is palpable among wine trade.

One importer specializing in grand cru classified wines from Shenzhen, who spoke to us on the condition of anonymity, confirmed the trend, remarking that out of 30 En Primeur buyers he knew, fewer than eight attended this year’s tastings in Bordeaux, he estimated.

Notably absent were major importers including Chengdu Fine West International Trade Co., Ltd, a specialist in classified wines, and Ningbo Yongyu, a veteran wine importer now selling on cross-border e-commerce platforms. Both companies, which had purchased approximately 2.5 million euros on En Primeur wines before 2020, did not send representatives this year.

Moreover, a major Shanghai-based wine importer that ranks among China’s top 10 and a regular buyer of Bordeaux En Primeur wines chose not to participate this year, the company has told Vino Joy News.

The interviewed Chinese importers cited a common reason for their absence: the high release prices of Bordeaux en primeur wines in recent years, which have not aligned with significantly lower market prices. For instance, many wines from the 2021 En Primeur campaign are now selling for less than their futures prices. This discrepancy makes it unfeasible to invest in futures when the sales of classified Bordeaux wines in China are barely breaking even.

Xie Jianjiang, General Manager of Ningbo Yongyu, complained about the discrepancy between high release prices and current market prices. “There have been many problems with the French En Primeur system in the past two years. In 2021, some chateaux’s market prices were lower than their release prices, and the prices of 2022 futures were too high, misaligned with market reality. The risks of purchasing En Primeurs have increased in recent years, so I have decided to take a pause before purchasing anything,” he explained.  

The decision on whether to purchase this year’s En Primeurs will depend on the forthcoming prices, as stated by the wine merchants.

Earlier in April, Wine Lister, a wine consultancy, reported an 8% decline in the average price of Bordeaux wines over the past 12 months. The report suggested that Bordeaux needs significant price adjustments to rejuvenate consumer interest in En Primeur purchases. It also recommended a 30% reduction in the 2023 vintage prices compared to 2022 to stimulate demand.

In China, the market prices of back vintages were often lower than release prices, deterring many importers from purchasing the 2022 Bordeaux En Primeur last year. This trend was exacerbated by some importers selling off their stock at lower prices to liquidate assets, which significantly dampened the enthusiasm for purchasing the 2023 En Primeur.

Despite the challenges, China remains a crucial market for Bordeaux prestigious wines. In 2021, Bordeaux exported 40.2 million liters, approximately 54 million bottles, to China (including Hong Kong and Macau), valued at 616 million euros.

However, from August 2022 to July 2023, exports to China dropped to 300 million euros, as we have reported. China continues to be Bordeaux’s largest export market, and the pricing strategy for future En Primeur will be a critical factor in sustaining this market relationship.

Vino Joy will continue to monitor these developments closely.