For The Love Of Port

K&L has them now listed...not cheap

2007 Fonseca Vintage Port (Pre-Arrival) $90
2007 Taylor Fladgate Vintage (Pre-Arrival) $90
2007 Croft Vintage Port (Pre-Arrival) $70
2007 Warre's Vintage Port (Pre-Arrival) $60
2007 Graham's Vintage Port (Pre-Arrival) $80
2007 Dow Vintage Port (Pre-Arrival) $70
2007 Quinta do Noval Vintage Port (Pre-Arrival) $80

klwines.com

Zowie... those are just crazy prices. I can easily find a 1985 Fonseca for less than $90, and that's a known-to-be-great bottle. Why would I want to pay more for a 2007?

2003 Novals are regularly half that... and again, the 2003 is already known to be pretty darn good.

I just don't get it. Why even offer them at those prices in this economy? Are they just preying on the uninformed?

They've also showed up here: http://www.vinopoliswineshop.com/ I wasn't looking for them, but noticed them in the list along with Warre's 2003 for $39 which caught my attention. Their prices for the 2007:

Dow's - $74
Graham's - $79
Warre's - $74

$39 for 2003, $74 for 2007. I know which one I'm going to pick.

Zowie... those are just crazy prices. I can easily find a 1985 Fonseca for less than $90, and that's a known-to-be-great bottle. Why would I want to pay more for a 2007?

2003 Novals are regularly half that... and again, the 2003 is already known to be pretty darn good.

I just don't get it. Why even offer them at those prices in this economy? Are they just preying on the uninformed?

Hi Glenn,

I understand your surprise at the prices listed by K&L. There are a few things to be mentioned. In private discussions I had with folks in Portugal about pricing, (I did not talk to Noval or The Fladgate Partnership groups) but a handful of other groups including some small single quinta properties too ... was told that their price ex-cellars to their US importers were either: identical, or some were as much as 7% below their pricing for 2003s. So what I believe we are seeing here is the retailers taking advantage of "discounts" being passed along by producers and importers and not passing these on to the consumer. Producers can certainly recommend pricing to their importers and have agreed upon margins (transparent between them) but neither can control retailers.

That said, although Noval and others may occasionally be seen deeply discounted as you have mentioned, it is not accurate to portray pricing as: "regularly half that." Not the case. Because although I presented an opportunity to you at that price at one time, can you find me some at $40 right now?

I know you were not buying Vintage Port before 2008, as a lover of wood-aged Ports, so I understand that you may not have been aware of what pricing was like at this exact moment in time ... for the 2000 and 2003 VP rollouts, when they took place in 2002 and 2005 respectively. Obviously the economic situation was quite different and even with 2000 those 3 zeros carried prices a bit crazier than they should have. But there was also a huge craze with 2000 Bordeaux at the same moment in time, so the market was very hot for new wines being launched from that historic vintage that received a ton of hype.

I do agree with you that some of the prices listed by K&L seem silly today, especially when we see prices decline from their pre-arrival or en primeur campaigns just a few short years later. Additionally, when older Vintage Ports can be had for nearly the same money, it makes you want to do this: :wall:

However, I am hoping that we will see other offers come out that are more in line with where the producers are expecting to see them, given that many have reduced their own margins to make that a reality. I am always leery about the first retailer to hit the market. We'll see others and I hope they will be more competitive than this.

Last but not least, it is no secret that there are still solid stocks of 1997/2000/2003 VPs in the US marketplace ... and that dynamic will be interesting to see how that plays into the quantities released from Portugal to the USA and UK. Hold back on the supply and pricing can be affected too (saving future releases for when the economy is stronger). That is always something that is considered by the shippers, so pricing is one key variable, while the supply side is another that should not be ignored. Buy now or wait and see later ... is the obvious decision for consumers. Retailers will have to make it worthwhile, if they have any expectations of igniting some sales, given the global scenario of today.

Roy Hersh wrote:That said, although Noval and others may occasionally be seen deeply discounted as you have mentioned, it is not accurate to portray pricing as: "regularly half that." Not the case. Because although I presented an opportunity to you at that price at one time, can you find me some at $40 right now?

Roy, I have purchased the 2003 Noval on multiple occasions (4 that I can think of off the top of my head) and have never paid more than $40. Yes, one of those was from you, but the others were not. And I'm not counting the shipping error that was supposed to be the 2003 Portal. I've found it for less than $40 every time I have looked to purchase it, so to me that qualifies as "regularly" whether or not it is currently available for that price.

The point is, these prices are crazy. As Tom has pointed out many times, why on earth would anyone buy a new and unproven quality release at price X if they can get a mature (or nearly mature) VP from an outstanding year for the same price?

I don't care what prices were for the 2003s at release. I don't care what they were for the 2000s at release. All your argument is telling me is that THOSE prices were out of control as well. Not my problem if the supply chain screwed up then, too, but was able to get away with it because the economy was better.

The question remains: why buy a 2007 Fonseca for $90 when the 1985 is available for $80?

(K&L has the 1985 Fonseca listed for $109, though, so perhaps the problem is simply that K&L it regularly too expensive.)

I am not telling anybody what price to pay. As mentioned, I think the prices quoted above are high, without question. The reason for buying a young vintage Port at this point in time, proven or otherwise ... is that when they are mature, you can be reasonably sure that if they were aged in your own cellar that you can bank on a fine drinking experience when they are mature.

I read tasting notes here and elsewhere all the time, mentioning light colors, seepage, slightly baked flavors or other qualitative issues ... the vast majority of these bottles were purchased on the 2ndary or tertiary market if not on the grey market, the issues stemming from provenance and typically improper storage from a previous owner, far more often then a poorly stored Port purchased on release from a wine shop.

That said, the price paid for the Port has to be what the buyer deems to be reasonable. For VPs that can and will improve for decades, nonetheless drink well early on too ... (which ever is your preference) then, one must decide what is a good price for them. I thought some of my 1991 and 1992s were expensive when purchased on release, especially after what I had already paid for my 1985s. However, those prices look outright insanely cheap today. This dynamic may change over time with Port which is certainly not the greatest investment financially ... but it certainly is very reassuring to open a bottle and be much more likely to have a bottle deliver the goods 20+ years down the road when they evolve as you know. OTOH, nothing is more disappointing than opening a bottle and having it show poorly and 95% of the time, that is due to poor storage.

I am the last one to argue that buying a 1985 Fonseca for around the same price as a current release is a no-brainer. However, you are comparing a Port released 24 years ago, in a very different marketplace, even before anyone thought about Euros. None of that matters as relative value is in the eye of the buyer. So if you prefer to spend your money on backfilling with older bottles because today's price for a young VP seems out of whack to you ... then have at it. Again, in this particular instance, I believe it is a retailer-specific instance, but we shall have to wait to see what others price their 2007s at.

In all fairness and accuracy the 2003 Noval VP deals were a result of the change of importer from Grant & Sons. As a result they sold off what they had in stock at insanely cheap prices. Retailers in turn sold them at the $40/bottle mark. So it's hard to use that one as a specific example when it was the result of a rare anomoly.

What is sad is that some retailers appear to be taking advantage of the lower prices they are buying them at. Obviously this is not what the producers intended to happen and it's sad because the backlash gets aimed at them when they did nothing wrong. People should be directing their anger at the retailers for jacking the prices up to make an extra profit

In all fairness and accuracy the 2003 Noval VP deals were a result of the change of importer from Grant & Sons. As a result they sold off what they had in stock at insanely cheap prices. Retailers in turn sold them at the $40/bottle mark. So it's hard to use that one as a specific example when it was the result of a rare anomoly.

Exactly. Until that took place, nobody was finding 2003 Quinta do Noval for anything like $40/bottle in the USA.

Roy Hersh wrote:

In all fairness and accuracy the 2003 Noval VP deals were a result of the change of importer from Grant & Sons. As a result they sold off what they had in stock at insanely cheap prices. Retailers in turn sold them at the $40/bottle mark. So it's hard to use that one as a specific example when it was the result of a rare anomoly.

Exactly. Until that took place, nobody was finding 2003 Quinta do Noval for anything like $40/bottle in the USA.

You guys are focusing on the example instead of the point.

Whether or not the 2003 Noval is currently available for $40, or was available for $40 before whatever importer change happened, is irrelevant. For the last 18 months (approximately) it has been available at or below that price point regularly enough that I've never paid more than $40 for it and I've made at least 4 purchases. That's just an example, but it is a perfectly valid example. You're picking at nits.

The point is that these prices are unrealistically high. Roy, you seem to think that I'm blaming the producers. I'm not blaming them, so there's no need for you to defend them. I'm merely stating that these prices are crazy. It seems arrogant to me, and I hope someone gets burned by it. Maybe that's K&L. Maybe that's K&L's distributor. Maybe it's the producers.

If I were inclined to actually buy any 2007 VP, I'd buy from Berry Brothers in London - who aren't exactly known for having the lowest prices themselves, pay to have the bottles shipped back to the US, and still come out ahead. That's how ridiculously high these prices are.

But I'm not inclined to buy any 2007 - yet - because at the moment I can get 1985s and 1994s for less. Ridiculous.

The point is that these prices are unrealistically high.

Your opinion is duly noted. Nevertheless, I don't think you are blaming the producers. You are upset about the high prices that K&L had listed for 2007 Ports, which you deem to be ridiculously high. I get it. I know where you are coming from.

When 2000 Bordeaux prices were first released, it was still possible to buy a four pack of some very fine 1989 or 1990s for the cost of one bottle of '00 first growth. Lots of people passed on these 2000s and chose to back fill. So only as an analogy, I do understand your gripe. Today, many of the blue chip 2007s at BBR's first tranche pricing were already gone. Someone must think they are a good deal. Some were gone in a mere few hours after being offered ... I am talking about significant VP allocations from some shippers.

You can wait and hope that there will be more competitive offers from some of the other big name retailers in CA (or elsewhere) and given the ease in doing so, I think that better pricing will be available and you'll eventually find some that are to your liking price wise, or maybe not. In the meantime, you can read more reports on the 2007s, taste a few yourself and decide what the best strategy is.

Roy Hersh wrote:The reason for buying a young vintage Port at this point in time, proven or otherwise ... is that when they are mature, you can be reasonably sure that if they were aged in your own cellar that you can bank on a fine drinking experience when they are mature.

I agree that provenance certainly has a value. And I understand that when I buy a 1963 at auction I'm taking a gamble. Sure, they report that the bottle came from a temperature controlled cellar, but what about before then? And before then? Maybe I'm deluded, but I tend to think when I buy a 2003 or 2005 from a major retailer, it didn't go through too many hands and poor treatment before reaching me. I guess there is still some risk, but what is the value of it?

I just got this attached to a, less than stellar offering for some ports.

Dan

I should warn you that the 2007 that are becoming available are of very limited production, some of the port houses cut there output by 50% this year, and instead of making more port sold the juice to go into table wines.

Glenn, I've got to agree with you. Something is wrong with Port pricing in the US. It happened with both the 2000's and 2003's. Now 1994 was a completely different. Pre-arrival prices were reasonable and continued to move up and have steadily moved up over the years. I bought a lot of 1994 Taylor and Fonseca on Pre-arrival and then after the reviews came out it was very difficult to get actual delivery and the prices had skyrocketed. Same for the 1992 Taylor. After Parker anointed it with 100 points it became very difficult to find and very expensive. Same for 1997 Noval.

All the big player's scores are out now (not Roy's though). So, the only reason that I can think of to buy these now is to lock in some just in case they get a 100 point final score from either Parker or Suckling. I don't see that happening before release. Given the scores so far, it seems unlikely. However, it may be possible for Taylor's VV.

People are right about a pricing disparity between the US and UK. In the UK, Taylor and Noval are going for $50-55. I consider that to be very reasonable.
-Dave-

Eric,

It is probably a rhetorical question, but of course, it is impossible to apply an actual dollar value. Knowing the provenance is vital with older bottles and again, that is why so many people experience bottles that don't show well. Not all flaws can be blamed on storage/shipping conditions, but certainly the vast majority can. There is a reason why bottles stored forever in cool and humid UK cellars cost a premium at auction vs. "great deals" seen from grey market consignment retailers.


Dans,

The quantities are down in 2007. But the reasons given in your quote from above (a retailer's sell piece) are inaccurate. That dynamic of grape going towards table wines happens every year and no more went towards the 2007 VPs than in other years, in fact, maybe less did.

The real truth about why there were lower quantities produced is based on weather. I will go into detail far more in my Vintage Port Forecast, but briefly:

A very wet late Fall in 2006, led to a dry and warm spring. Flowering took place in May under cool and wet conditions which right from the get go, made for a somewhat smaller crop. Rains were intense after that, especially in June and into mid-July, paired with very cool temps. Many growers lost lots of their typical yields due to fungal issues initially and secondary mildew thereafter. Treatments and crop thinning were a necessity, yet not everyone did this. Leaf removal to allow for sun penetration and aeration was the key to success after the mildew treatments that some vineyard managers applied. There were plenty of growers who did not have the wherewithal (nor sense of urgency) in dealing with these issues. These conditions specifically resulted in a smaller crop of Port and Douro wines overall, not the misinformation in that quote.

David,

We are all in agreement that the UK has better prices than the USA. There are several reasons for that which should be pointed out for anyone who is not aware of some of these dynamics.

a. The shipping costs to the UK are significantly less than what it costs to get product to the USA.

b. We have a true 3-tier system here (importer/distributor/retailer) and each is in business to make a profit. So what leaves Portugal, literally gets "stepped on" 3 times. In the UK, most often there are only two tiers. This is a HUGE benefit to consumers, reducing one cog in the wheel is the MAIN difference between UK and US pricing.

c. Decades/centuries old agents in the UK with v. long term relationships of buying directly from shippers and then selling to retailers/restaurants makes it easier for the Port trade to "control" pricing. In the USA, Port shippers can only control the prices into their importer and possibly affect the pricing then into the distributor. But they can not control the distributor (the importer can only "suggest" and modify allocations if they are not happy with pricing by distributors) and nobody controls retailers (here or in the UK).

I agree with you that pricing took a serious hike in the mid-1990s ... and those were the real boom years for Port sales in the USA and may not be seen again anytime soon. But it was not just big scores and a great 1994 vintage ... although that certainly helped. There was a big jump from the 1991/1992 split, to the 1994 but also a nice uptick in 1999 when the 1997s came to market.

Then again in 2002, in the face of recession and just after 9/11 when the 2000's came to market, the Bdx market was overheated as you know and the "Millennium Effect" raised prices for Port too. The levels of 2000 VP were nearly double the prices I paid for 1991/1992, and in 2000 I am talking about UK first tranche pricing vs. pre-arrival in the US for the earlier vintages. It was this gap that finally had a significant effect on VP Port buying for many. 2003 was a much smaller harvest than 2000, even though the economy was MUCH stronger than when the 2000 VPs came to market. Yet, those who had followed Port pricing for 2 decades+ like you and me, were taken aback by another increase over the 2000 levels.

At some point there had to be a correction. I thought we'd see it with 2007 due to the world's economy, a fine vintage, US and worldwide Port sales which have been typically stagnant in most cases and a marketplace still well-stocked with recent vintages ('97/'00/'03). Wisdom only goes so far.

In the UK where pricing is quite a bit more advantageous as mentioned above (although very recent strengthening of the Euro, but more so, the GBP vs. the USD is considerable!) sales of 2007 VP futures are reportedly brisk. I don't get the same impression on our side of the pond ... not with the pricing as it has translated here so far. Will other retailers still to release their pricing, be more prudent in order to heat up sales?

Roy Hersh wrote:The quantities are down in 2007. But the reasons given in your quote from above (a retailer's sell piece) are inaccurate. That dynamic of grape going towards table wines happens every year and no more went towards the 2007 VPs than in other years, in fact, maybe less did.

The real truth about why there were lower quantities produced is based on weather.

Roy,

I did understand the quantities are down in 07, but I didn't think it was 50%. Do you know what the diffs were from a 'typical' year?

I was assuming this was typical retailer speak as he isn't that "experienced", if you catch my drift.

Dan

dans wrote:I just got this attached to a, less than stellar offering for some ports.

I should warn you that the 2007 that are becoming available are of very limited production, some of the port houses cut there output by 50% this year, and instead of making more port sold the juice to go into table wines.

Dan,

Here's a little story for you. I have a particular rum that I buy for my wife because she really likes it. But it's not a huge brand, so it can on occasion be difficult to find. The last time I found it, I bought 6 bottles just to be safe. Those were eventually all consumed, so I went searching again and couldn't find it anywhere. I did find a record of the last place I'd found it, though, so I called them. What did they tell me? "Oh, they don't make that anymore."

I was immediately suspicious because this was a sought after and very highly rated rum. It made no sense for them to have stopped making it unless they'd gone out of business, and I knew that wasn't the case. But I thanked him for his information, declined his offer of several other lower-quality brands of rum that he had in stock, and hung up.

Since the retailer had made me suspicious, I expanded my search. What do you know, it's available just about everywhere in the world EXCEPT the United States. The retailer incorrectly assumed that because he couldn't get it that it must not be made anymore. Either that or he wanted me to buy one of his other rums and didn't want me looking around because he knew I'd find it elsewhere. He didn't say "I can't get that anymore," or "my distributor doesn't carry that anymore." He specifically said "they don't make that anymore."

So... maybe I'm turning into a skeptic as I get older, but I just don't believe anyone who's trying to sell me something anymore. It rarely turns out to be correct.

Caveat emptor.

So Glenn, you "catch my drift". As the old expression goes "how do you know a salesman is lying? His lips are moving".

I'm not saying that is the case here. I just think he doesn't have the experience. He is replacing a guy that I've been buying from for 14+ years, he is a nice kid and does try and give me the same deals I got wi9th the last guy. But he doesn't seem to be able to determine when a distributor is feeding him a line of crap or understand that he needs to tell his customers about offers (that is, when the interesting stuff is offered, WON"T WAIT it might not be available in a couple of weeks).

Dan1

Glenn E. wrote:So... maybe I'm turning into a skeptic as I get older, but I just don't believe anyone who's trying to sell me something anymore. It rarely turns out to be correct.

I'm just a noob here at , and maybe I'm being a little presumptuous, but I think I know more about Port than just about any retailer I've dealt with here in Colorado. Given how much I know I don't know, I'm sure there are some more knowledgeable than me, but they haven't been working when I've been in the store.