What is ‘en primeur’?
Author: Katie Rolph
What is the en primeur system?
In a nutshell, en primeur (or wine futures) refers to the system by which Châteaux sell their wine from the barrel; that is, before it has been bottled and delivered to customers (and also before it’s ready to be drunk). The wine is sold at a keen price, in return for payment up front, which helps the Châteaux fund the next vintage.
It was developed by the Bordeaux wine trade although other regions such as Rhône, Burgundy and even parts of the new world now choose to offer some of their wines en primeur.
How does it work?
The en primeur ‘campaign’ is a yearly event stretching from spring into summer, depending on the vintage. Each April, Bordeaux is besieged by merchants, journalists and enthusiasts, who taste the new vintage and make their judgements, prior to the release of the prices.
Merchants taste the wine and although the wines are still in barrel and are very youthful, an experienced merchant can sense the quality and longevity of the wines and make a corresponding judgement on what is a fair price. Each year we send our sales teams across to Bordeaux to participate and make up their own minds – you’ll soon be able to follow their progress on our blog, Facebook page and Twitter account.
The châteaux then set the price for their wine and release a first tranche (generally a small quantity) for sale. Depending on how this sells, they may release a second, bigger tranche at a slightly higher price. The merchant buys the quantity they think they will sell and offers this to their customers.
It varies from region to region but in the case of Bordeaux, two years after the sale the wines are shipped to the merchant who purchased them and the customer, who purchased them from the merchant, can choose to take delivery or can store them with their merchant for an annual fee.
Why should I buy wine this way?
There are two main advantages to buying wine en primeur:
Availability: You get ‘first dibs’ before the wine goes on general sale plus you get access to wines made in limited quantities which often won’t be widely available later on.
Price: The earlier in the process you buy the wine, the cheaper it is likely to be. And generally all wines purchased en primeur will be cheaper than buying them ‘off the shelf’ in a few years’ time.
Plus at the time you are offered the wine, you pay purely for the liquid in the bottle. Duty and VAT is then due at point of delivery to your home – so it’s also an effective way of spreading the total cost of your purchase.
In hotly-anticipated vintages, the system may allow you to get some great deals because not only is the wine usually at its cheapest when bought en primeur, it may also be the best chance for securing sought-after wines.
What else do I need to know?
Cases are sold in full, unsplit cases so it’s a great way to stock your cellar for future drinking.
You should always buy from a reputable merchant as you are effectively purchasing something that is not in its finished state yet. Buying from a well-known merchant makes your purchase less risky.
En primeur is not just for first growths and the most expensive wines. All levels of wine are represented so you can start off small if you’re new to buying this way. This means that whilst many wines are sold for investment purposes, a significant chunk will be drunk and enjoyed in years to come.
For more information, visit our website or contact our Fine Wine Team