What Is En Primeur – The Ultimate Guide

Predicting the future has always held us in thrall. From Nostradamus to Paul the octopus to fairground fortune tellers, certain psychics have managed to foresee what’s coming next with stunning accuracy. Who can forget Nikola Tesla’s interview with The New York Times in 1909 (almost a full century before mobile phones were commonplace) where he said, “it will soon be possible to transmit wireless messages all over the world so simply that any individual can carry and operate his own apparatus”? Or Mark Twain, accurately predicting his own death in 1909 (a year before it happened)? Or even the 30 times that the seemingly absurd plotlines of The Simpsons have come true (Donald Trump for President? The NSA spying scandal a full five years before Edward Snowdon blew the whistle?). 

Everywhere from business to medicine to the climate, forecasting the future has become a necessary part of our lives. Yet, it is a complex and absolutely critical job. No one has a crystal ball and even if you did, would you trust it? And in terms of fine wine investing, what does this mean? More importantly, how do you do it?

While there is no such thing as a certain future, there are a few things that we can do that will help us channel our inner Gypsy Rose Lee…

What Is En Primeur?

Also known as futures, en-primeur wine is wine that has been fermented and transferred to its aging barrels but has not yet completed its initial maturation. 

Fine wines tend to be matured between 14-20 months. Around six months after the harvest (usually in late spring), barrel samples of the new wine will be tasted for the first time by a select few. These critics and connoisseurs are the first to taste the new vintage and will base their initial opinion on this barrel tasting session.  From this an opinion will be formed on the wine and a price can be determined. Preliminary scores will be given and published in the professional press. This is a decisive point for the estates.

The wine will then carry on ageing for another 2-3 years before physical bottling and release to the general public. During this time period the wine will be tasted again and re-scored. The evolution between these two scores is crucial to investors as it indicates how the wine will age over time. 

The process of buying wine en primeur happens at the initial stage i.e. during the barrel tasting session. So, wine investors need to trust their reviewers to be able to predict the future with a future. 

Certainly, there are innumerable benefits to buying wine en-primeur. But like most things, there are a few pitfalls as well …  

History of Wine En-Primeur

As always in the fine wine trade, the en-primeur titans are in the French regions of Bordeaux and Burgundy. The (literal) roots of the practice are disputed – there is a record of a vintage dating from 58 AD that was allegedly so good every bottle of wine was bought while the grapes were still on their vines. Moving forward, it was a well-known practice in the 18th century for negociants to visit various estates in Bordeaux and Burgundy and buy grapes straight off the vine. So en-primeur is not a new idea.

Yet, the en-primeur process that we know today did not really start until post World War II. The first half of the 20th century had been unkind to the Bordeaux and many of the estates, (including a few legendary First Growths), were underfunded and or poorly managed come the 1960s. Some of the wealthy negociants – who at the time yielded all the power in the region – agreed to buy wines from the most reliable estates in advance at a reduced rate. This provided a much needed cash injection for the chateaux, while allowing the negociants to set their own prices for resale. Burgundy quickly picked up this process, followed by the Rhone Valley.

Can Every Wine Be Sold En Primeur?

Traditionally, only the three main French wine regions (Bordeaux, Burgundy and the Rhone Valley) had a product stable enough to warrant en-primeur practice. However, with modern winemaking techniques, leaps in oenological education not to mention vastly improved equipment, singular fine wines are no longer limited to French terroir. California’s Napa Valley has adopted the en-primeur practice, as has Australia. Tuscany, too, is becoming a hot spot for savvy investors who want to get the best for less.  

What Are the Benefits of En Primeur?

The benefits of buying wine en-primeur are numerous and manifest. 

Low Price

The first reason to buy en-primeur is simple: it’s cheaper. Buying wines before their due date offers a chance for investors to buy into stock at its lowest possible market value. Return on investment (ROI) is thus, in theory, at its highest potential. 

Long Time to Sell

Buying wine before it has hit the secondary market means that it has one of the longest investment horizons possible. Bear in mind that fine wine is created to improve as it ages. Over time, it continues to develop in quality and as it approaches its drinking window (the period of time when it is considered to be at its peak for drinking). Once it has hit this pivotal moment, it becomes more attractive to consumers. 

However, drinking windows often begin around five years after bottling and last for around 10-20 years. With this in mind, investors should note that buying wine en-primeur is a waiting game, if you want to see it through from conception to completion. 

Bigger Return of Investment

Although selling en-primeur stocks can be done at any stage of the sales funnel, the real returns start to show as the wine approaches or enters its drinking window. As previously explained, once the wine is considered “ready” for drinking, it increases its market to include consumers as well as investors. Therefore, demand increases whilst at the same time the supply is inevitably reduced. Naturally, this forces an increase in market value. This supply and demand curve is a “no brainer” – buy low, sell high. If you have the patience that is.

Guaranteed Provenance

All luxury goods are at risk of contraband and fine wine is no exception to the rule. China faced one of its worst fake imported wine scams ever in 2017, with over 30,000 bottles of bogus wine being sold per hour during the peak of the crisis. Empty bottles of certain wines – mostly Bordeaux First Growths but also big names such as Henri Jayer, Petrus, and the burgundies of Domaine de la Romanee-Conti – sell for up to $1,000 each and are then re-corked and re-sold to unknowing buyers on the black market. Thus, the provenance of your wine is extremely important. 

However, good provenance does not only mean guaranteeing the source of the wine. The provenance also takes in the life cycle and storage – both of which are of paramount importance when buying and selling bottled fine wine. En-primeur does not face these issues as it is still in the barrel when bought. 

Buying en-primeur guarantees your wine’s provenance. Simply put, as the wine is still at embryonic stage, it has not yet had time to be reproduced. Buying en-primeur means that you are buying directly from the chateaux and you simply cannot get any more authentic than that. 

As Vindome only works directly with the chateaux and estates, it guarantees the provenance of all wines on its platform, bottled or not. This makes the resale of your asset(s) smooth and secure. 

Risks of En Primeur

There are of course some risks with buying en-primeur.

Number one is that you are not buying a finished product. You are also relying on someone else’s opinion as there is no market data to base your investment on. So you have to know who is who in the business, and when opinions differ (and they can, as seen by the now famous Parker/Robinson Pavie debate in 2012), who to trust. 

Buying en-primeur means you’re taking a chance with your funds, but quite honestly, when in serious investing are you not? You are essentially taking a gamble on quality, aging potential, drinkability and market popularity, so it’s important to do your homework. Desirability and availability also greatly affect the wine’s potential resale price. The smaller the property or in some cases, the smaller the yield, the rarer the wine. Ergo, the more likely it is to command a higher resale price. 

None of us are fortune tellers, and even if a chateau has a sterling reputation there is no guarantee that your Bordeaux baby will increase over time. In some cases, your investment could actually decrease.

How Does En Primeur Work?

So, you’ve done your market research, read everything the critics have to say, studied the weather and read the harvest report for the previous year (if you don’t know where to find one of these, the Saturnalia Harvest Report provides fantastic insights to Bordeaux for all those interested in deep-diving into researching their investment). You’ve looked at the temperature trends and vineyard conditions for the previous year and have decided that yes, you want to invest in some wine en-primeur. Ok, so how does the process actually work? 

En Primeur Tastings

En-primeur wines are tasted by professionals who deliver their verdict 12-18 months prior to its official release. The process follows four (five) very specific steps. 

  • Step 1: The first step for buying wine en primeur has nothing to do with you, the investor. This step is strictly for the pros alone. Around six months after the harvest (usually in late spring) chateaux and producers in Bordeaux and the Rhone Valley organise a tasting week. They will issue invitations to a select band of critics, negociants and professionals who will taste barrels samples of young wine that has been fermented but has yet to mature. Note that most barrel tastings are done blind, meaning that the tasters are unaware of the wines’ identities. Based on these tastings, critics will deliver their initial score. The score is usually given on a scale of 1-100/100 but some critics, such as British Master of Wine Jancis Robinson, use a 1-20/20 system (see below). Investors should pay great attention here as this score gives a preliminary idea of what to expect from the wine in the future.
  • Step 2: Once the ratings are in, the chateaux define a price scale and release it at the Place de Bordeaux. This step is still only for wine professionals, notably wholesale sellers such (ie negociants). 
  • Step 3: This step is where you, the investor, can finally start playing an active role. Merchants (negotiants) send their prices to their list of contacts – wine market platforms, retailers, commercial exporters etc …). These offers are sent with the wine tasting notes, in case you haven’t managed to read the papers. 
  • Step 4: Buying the wine. You will need to purchase the wine in its totality between 12-18 months prior to release. The waiting game begins. 

Ratings & Price Estimation

Critics deliver their opinions of the wines tasted during the tasting week in the professional press approximately 2-3 weeks later. The 100-point scale which is used by most (but not all) critics became popular in the late seventies after wine guru Robert Parker began using it in his print then digital magazine The Wine Advocate. Due to its capacity to accommodate and reflect the subtle difference between each wine, the 100-point score quickly caught on and is today one of the most used scoring systems there is. 

Some critics, notably Jancis Robinson OBE who writes for The Financial Times prefer to use a 20-point system as “60% of the scale never gets used”. The 20-point system is Robinson’s own benchmark and is what she feels more comfortable with. 

Investors should also note that when a score is followed by a plus or minus sign it invokes a degree of uncertainty. If, for example, you see a score of “96+” (or 18+) then the critic believes that the wine will improve with age but is not willing to confirm their opinion at the current time. A minus sign means that they believe the wine will decrease in quality but again, are not sure. 

Wines are rated several times during their lifetime. Investors should pay special attention to the ratings at en-primeur stage, followed by the first rating once the wine has been bottled. The evolution between these two scores gives a good indication of how the wine will perform over time.

Wine critic ratings are as follows:

100 Point Scale (Robert Parker)

95–100Classic: a great wine
90–94Outstanding: a wine of superior character and style
85–89Very good: a wine with special qualities
80–84Good: a solid, well-made wine
75–79Mediocre: a drinkable wine that may have minor flaws
50–74Not recommended

20 Point Scale (Jancis Robinson)

20Truly exceptional
19A Humdinger (Excellent) 
18A cut above superior
14Deadly dull
13Borderline faulty or unbalanced
12Faulty or unbalanced

Burgundy En-Primeur

Buying en-primeur in Burgundy is the “same, same, but different”. Yields in Burgundy are much lower, thus smaller quantities of course mean higher prices. The Burgundians are traditionally less prone than their Bordeaux counterparts to overcharge for their wines, but they too have to make a living, and if there is less to sell, then they have to ask more for it. So, you might not get as much bang for your buck in Bourgogne. 

The process of buying futures in Burgundy is far less complex than in Bordeaux. Producers host domaine tastings around about the same time as in Bordeaux, but also host “Burgundy Week” tasting events in key cities such as London or Tokyo.

Delivery of En Primeur

Step 5: The final step of buying en-primeur wine is the delivery of the bottles, 12-18 months after the initial tasting (step one). Typically, en primeur is available in 75cl bottles but this is often the time when chateaux and estates release limited edition sizes (Double Magnums, Imperials etc), which have vast resale potential on the secondary market. When ready, wines are delivered to the chosen bonded warehouses of the negociant or reseller. They are then available for domestic delivery or storage and eventual trade on the secondary market.

Benefits of Bonded Storage of En Primeur

In order for fine wine to age correctly and improve in quality, it must be kept in constant stable environmental conditions. This is regardless of whether you want to resell or consume it.

Investing in storage in bonded warehouses is advisable for many reasons:

  • A bonded warehouse ensures optimum conditions at all times, and provides an ideal setting for your wine to age as anticipated. Not only are these warehouses temperature and humidity controlled, but they offer maximum security 24/7. 
  • Bonded warehouses are located strategically close to the production regions, thereby limiting any (potentially hazardous) transports. 
  • Storing your en primeur wine collection in a bonded warehouse allows for a comprehensive and competitive rate of insurance. Certain insurance companies will not insure fine wine if not stored in one of these facilities. 
  • As the wine ages, its provenance and traceability are guaranteed. For resale this is clearly beneficial (and often, obligatory).

VAT on En Primeur 

The final reason that we recommend bonded storage is that until a wine is delivered, it is not applicable for VAT, nor duty. This is regardless of whether it is sold on post delivery, provided that the buyer chooses to keep the wine in bond as well. If you decide to have the wine delivered (i.e. leave the bonded facility), VAT is charged on the original sale price of the wine, not the current market value. This final point can often save you a great deal of money. 

Now you can start investing in en primeur wine with just a few clicks through a wine investment app like Vindome!

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