The Cognac Masters, held every November has become to us something of a ritual since, Hermitage Cognacs have enjoyed very great success over the years at the competition.

Many of you will know that this year we won three Masters Medals, as well as the Cognac Grand Master for the sheer quality of our cognacs. One of the three medals went to the Hermitage 1988 Grande Champagne from Ambleville, a light and delicate cognac with great style. This cognac will be made available from the 1^st May. It is the very essence of quality and a worthy Masters winner.

The start of the year is always a flurry of high expectations in the drinks business with Exhibitions in Germany and Italy, followed in the UK by the London show at the Excel Centre in May and this year by Vinexpo the big trade show in Hong Kong.

Vinexpo changes every year between Bordeaux and Hong Kong, and this year it is sold out by more than 500 square metres. Indeed, Hong Kong is fast becoming the centre for Asian drink sales exhibitions with people travelling from all over Asia to visit and see the finest drinks available from the most luxurious alcoholic drink suppliers of fine wines and spirits.

The German exhibition, Prowine, is fast becoming recognised as one of the best shows, but Vinitaly in the beginning of April is also highly regarded. The Hong Kong Wines and Spirits Exhibition will wind up the year in early November, where again the Conference and Exhibition Centre is expected to be packed to the limits.

Brandyclassics will have a stand at the Hong Kong Wines and Spirits Exhibition in November, when we hope to greatly expand Chinese sales.

Exceptional Prices for Cognacs and Wines

It seems that there is an insatiable demand for high quality wines and spirits at auction houses around the world, especially those in Asia who are not only experiencing 100% sales but also at record prices.

Last September a world record was set in Hong Kong for a bottle of 1858 cognac which sold for US$156,700, whilst more recently at Sothebys in London, Asian buyers pushed the Top 10 lots comfortably over their high estimates. Bidding was particularly strong on-line, accounting for an increase of 15% of sales against 16% in the room.

Sales of wines at Sothebys in Singapore recently achieved US$8m and included an American collection which contained a case of 1982 Pètrus for US$65,950, three double magnums of 1982 Lafite for US$56,000 and a case of 1982 Lafite for US$36,600. Bidding was very strong in all the top lots.

This year Bonhams in Hong Kong will be auctioning a bottle of 1888 (triple 8) cognac at their sale in May, this is a highly sought after cognac and it may achieve another record.

Watch this space!

What a turn up for the books, snow in the Champagnes! Indeed not only snow but the Charente is currently going through the worse spell of cold and icy weather for twenty seven years.

Temperatures around Cognac have been averaging between -3 to -13 degrees making roads all but impassable – worse, there appears to be no obvious future let up in this unusually cold period.

It has been reported that the snow is the first to fall in the region for ten years. The region is known for its moderate but not extreme climate and the weather has come as something of a shock to many. One viticulturist however claimed that the cold spell will kill of many of the bugs and diseases making for better growing conditions in the summer. Let’s hope he is right, with the continually increasing demand on young cognac, we will need all we can get!

Cognac distributors in China are failing to obtain sufficient stocks to fulfill demand. Many producers in Cognac are under pressure to supply valuable stocks to major negoçiants for blending in VSOP, XO blends. The shortage of supply is forcing prices up and leading to higher costs of new cognacs. Thousands of distillers all over the region are being asked to supply even younger cognacs for blending, with inevitable loss of quality. Industry body the Bureau National Interprofessionel du Cognac (BNIC) said more than five bottles were sold every second in 2011, the total number of bottles sold rose by 6.4% to 162.9 million.

The Far East, which accounted for more than one-third of demand, was the biggest and fastest-growing market with volumes up 14.4%. Sales in China alone rose by 20% the BNIC figures reveal. Growth in Europe was more modest, with the region’s volume sales edging up by 0.4% to 46.9m bottles, while demand in North America rose 3.2% to 50.8m bottles.

Speaking to Reuters, Rémy Cointreau chief executive Jean-Marie Laborde spoke of his optimism for the coming year and his belief that the recovering US market, coupled with the rapid growth in Asia, will help counteract the continuing economic struggles in Europe. Laborde said that sales in the October-December period in particular had exceeded expectations, mainly due to increased Cognac shipments ahead of the Chinese New year. Is big brand optimism good for cognac? Certainly not for quality!

Cognac Prices Soar

The increasing demand for cognacs in the world markets should have been a warning to the industry and this could have been the case, except for a blip in demand in 2008 when fears for the world economy led to fears that we were producing too much.

Unfortunately, this was followed by a poor harvest and the damage to stocks was complete whilst demand, especially in SE Asia is marching on. The shortage of 5-10 year old eau de vie this year is forcing prices up in some areas by as much as 20% and in Grande Champagne price increases have already been as high as 14%.

Price increases for younger cognacs have not been quite so severe and older cognacs are only marginally higher at the moment. Trends in past years suggest that prices for ten year old cognac will drop around September since the big houses set their contracts at the beginning of the year. Many of the smaller distillers who rely on the big negoçiants will be looking to sell stock around September which should ease the pressure for smaller sellers.

This year has been our best year so far for new products and exciting new markets. Our range of customers has increased and now includes many overseas in countries as far away as China and Russia, as well as our Middle East Friends who have been active again in 2011. The increasing demand for our products proves again and again how customers seek pure naturally aged cognacs with age statements.

Of course, this also means that the need for greater depth of knowledge of cognacs and brandies has grown, and as from next year we will be introducing a different monthly mailing, which will include more opportunities for you to learn more about our wonderful brandies.

We hope that you will still enjoy reading about them!