Thursday, May 10, 2007

Burghound and the Market

I certainly agree with Jeffrey's post below that there is more good-will and appreciation felt by wine collectors toward Allen Meadows, the Burghound, than toward other critics like Parker or Jim Laube. Yet I have seen signs in recent weeks of a growing frustration with Burghound's role in stimulating unprecedented demand and setting the market for what many collectors will be a very expensive 2005 Burgundy campaign.

Meadows comes in for criticism not for the wines he chooses to rate highly but rather for rating wines in the first place and, more fairly, for the timing of his reviews. Burgundy collectors are obsessive and intensively secretive by nature. They are reluctant to share the sources of their highly sought-after allocations and sometimes even the identities of their favorites for fear of losing out or being priced out. Meadows, many feel, has let the cat out of the bag, so to speak, pointing the way for novices toward hidden gems and undervalued treasures previously known only to insiders. And certainly, the timing of his reviews could not have been worse, as his 2005 Cote de Nuits issue -- "quite simply the best top to bottom vintage I have ever seen, period, full stop" -- came out well before most of the wines reviewed were even offered for sale in the U.S. Given the estimated 20% ex cellar price increase over 2004, we certainly know who in the supply change is gouging the American consumer.

Meadows reportedly sold more single issues of his Cote de Nuits report than all of the previous Burghound issues combined and is said to be concerned over the role he has played in the unprecedentedly stratospheric '05 Burgundy pricing. This Parker-esque market domination is uncharted territory for Burgundy, as The Wine Advocate's longtime Burgundy reviewer, Pierre-Antoine Rovani, generally favored the region's ripest wines and vintages while the traditional Burgundy consumer has favored elegance, balance, and finesse -- all of the qualities dear to Meadows. To cite just two examples of Meadows' influence: on the day Meadows' Cote de Beaune report was released, Bouchard's Le Corton (AM 93-95) sold out at Premier Cru for $89.95 and reappeared the next day at $109.95; Angerville's Volnay "Champans" (AM 93-95) had a one-day jump from $95.00 to $110.00 at Zachys.

Yet while rising prices are an inevitability, particularly with all the hysteria surrounding this unique vintage, I don't believe Burgundy will be subject to the same efficient market forces as Bordeaux. The far smaller production volume and the allocation system mean that Burgundy just cannot be bought and traded in the same way classified Bordeaux is. Moreover, there is a far healthier attitude toward wine in Burgundy, where it is treated as an artisanal product vinified by farmers rather than commodities produced by millionaire Chateau owners and sold by greedy negociants. And in the meantime, Burghound's growing influence can only bring about improvements in the region, as producers gravitate toward the more elegant and balanced style that Meadows favors -- and has long proven to be the hallmark of the very best Pinot Noir.

1 comment:

ScottS said...

So... critics should wait until these very scarce wines are on the market before publishing their reviews? All the wine will be long gone! The reason people pay for subscriptions to Meadow's magazine is to avoid expensive speculation given the many disappointments with Red Burg. I noticed that some Tanzer subscribers complained about the timing of his Burg coverage for just that reason. Reading notes on wines that you either already bought or missed out on is not nearly as useful even if it is equally fun.

For many regions one might argue that consumers dabble on their own without reviews, but Red Burg, being simultaneously scarce, expensive, inconsistent and often offered for sale on a futures basis is a region that really calls out for barrel / advance reviews, even if it raises the price in a great vintage. We have to hope that a less stellar vintage review will have a different effect on prices.