Like the British royal family, the Hospices de Beaune wine auction is both ancient and surprisingly modern. Just as there are traditions in Britain that stretch back aeons, so the charitable institution of the Hospices was founded in the 15th century. But the royal family as the British know it — the institution, the Christmas speech, the regimental ceremonies, the Crown Jewels — was invented by Queen Victoria. It’s really not much more than 100 years old.
The Hospices de Beaune auction has had a similar trajectory. It’s held in the 600-year-old Hôtel-Dieu, one of the finest examples of French mediaeval architecture, and a high point of the auction weekend is a dinner at Clos Vougeot, whose walled vineyards were set up by Cistercian monks around 1115. The dinner always begins with the inauguration of new members to the Confrérie des Chevaliers de Tastevin — complete with medieval trumpeters, floppy hats and buckled shoes. But the Hospices auction only began in 1859 and the Confrérie was created in 1934.
The same is true of Maison Louis Jadot, which along with names like Faiveley, Bouchard Père et Fils and Drouhin, is one of the great négociants-éleveurs of Burgundy.
Big in Burgundy
Louis Henry Denis Jadot founded the house in the same year as the auction, 1859, on the Clos des Ursules vineyard — which remains the house’s sole monopole — bought some 40 years before. Jadot was family-run until the Kopf family, owners of Kobrand, bought it in 1985 and since then it has been overseen by the Gagey family. In 1992 André Gagey handed over the presidency to his son Pierre-Henry (he favours the English spelling), whose own son Thibault is now joint managing director. The winemaker, the renowned Jacques Lardière, passed responsibility to the equally respected Frédéric Barnier in 2010.
Jadot is one of the biggest owners in Burgundy, controlling 225 ha vineyard across the region under hundreds of different labels. The backbone of the company is the 119 ha in the Côte d’Or: Domaine des Héritiers Louis Jadot, Domaine Louis Jadot, Domaine Gagey and Domaine du Duc de Magenta. Then there are 18 ha in Pouilly-Fuissé and 85 ha in the Beaujolais — Moulin à Vent, Morgon, Fleurie and Chénas. “I drink Beaujolais Villages for lunch every day. I love it,” says Gagey.
The most prized vineyards are the Grands Crus such as Corton Charlemagne, Chapelle Chambertin, Clos Vougeot — Jadot has two hectares of this 50 ha vineyard, a major holding — Chevalier Montrachet Demoiselles, Clos St Denis, Echézeaux. The Beaune vineyards Gagey describes as “a nice range of Beaune Premier Cru: our DNA”.
There is also Chablis, where Jadot doesn’t own vineyards but has long-standing contracts. Gagey says he’s been on the lookout for land there for 30 years. “Maybe my son will succeed in buying something there,” he says, somewhat wistfully. Finally, there are 8 ha in Oregon, the Résonance vineyard in the Willamette Valley, which, as is frequently pointed out, is Jadot’s first foray outside Burgundy since the house’s foundation. The US operation is run by Thibault Gagey.
Jadot, then, is a powerful presence in Burgundy. The sheer size of its holdings makes it so and Lardière’s laissez-faire winemaking philosophy — no temperature control, as little intervention as possible, reduced use of oak — has earned Jadot a reputation among connoisseurs as a highly serious operator, as dependable at the lower levels as at the top. Jasper Morris MW, typically understated in his book Inside Burgundy, says he is “very impressed” with Barnier, “who must have exceptional energy to manage the scale of production with the detail which he is obviously bringing to bear. The basic style of the wines has not materially changed but there is a fresher feel to the wines in the last few vintages, which is very encouraging.”
Gagey is very aware of his company’s history but there is no doubt that he is an efficient modern businessman. He has a clear strategy to operate in as many markets as possible, rather than focusing energy on three or four target markets, or concentrating on Asia, for example. “There is no special market we’re trying to develop. We go wherever there is interest in quality wine — Europe, the Far East, the US.”
The shadow of Brexit
An optimist and a good-humoured interviewee, Gagey talks about his export markets as if there isn’t a cloud in the sky. “Some regions will do better than others depending on the market and currency fluctuations. Strangely enough, the EU countries are doing well; Sweden, Norway and Denmark are fine (Scandinavia is up 20 per cent), and the ex-Soviet bloc is good. Switzerland, Belgium, Netherlands and Luxembourg (Benelux is up four per cent), Spain and Italy are still good markets.”
What about the UK? Surely Brexit has cast a shadow? “The only effect of Brexit so far is the currency. We could be in great difficulty but the British are still drinking great wine, so business is good.” The UK is up 12 per cent in 2017.
There’s nothing new in this, of course. It’s long been known that the top end of the market is more or less immune to currency fluctuations and political upheavals. As Christian Seely of AXA Millésimes told the Financial Times (talking about Bordeaux), the “long trading history” between our countries “existed for centuries before the European Union was ever thought of”. It’s going to take more than a referendum to stop the British drinking fine French wine.
The situation has been complicated, though, by the devaluation of sterling. This has been a boon for British exporters, but has made things difficult for wine producers looking to their traditional market across the English Channel. Many producers have compensated by raising prices. Research bodies have repeatedly warned that wine prices are predicted to rise by over 20 per cent over the next decade. Importers have been lamenting the situation — what can they do but pass price rises on to the consumer? — but Gagey is looking longer-term.
“The pound has lost 20 per cent but we haven’t increased by 20 per cent. We take part of the burden and share it with our importer,” he says, adding that the company gives currency support, especially for entry-level wines. “We take seven per cent, the importer takes seven per cent and the consumer takes seven per cent. This shows goodwill to the consumer — it’s not their fault the pound has lost its value. We’ve been in the UK a long time so it’s fair to do that.” It’s fair, and it’s also canny: it guarantees goodwill at every level of the distribution chain.
Part of Gagey’s success is his constant attention to the consumer. It might seem obvious — any good businessman stresses the importance of the end-user — but he constantly refers to the primacy of the person who pays the bills. He speaks up for the new Bourgogne Côte d’Or, the controversial new regional denomination inaugurated in November last year, which sits just below Village level. “The [new] appellation is important for places like Beaune, where the wines are complex and you see an increase in prices.” Anything that makes Burgundy easier to understand, and therefore more approachable, is a good thing. But isn’t it prohibitively complicated — surely there are enough quality levels already?
“Yes, it’s complicated and you have to rely on producers to explain it,” he says. “So you go to a producer whom you trust, like Maison Jadot, and as you learn more, then you go into more detail.”
Doesn’t such a system favour the big producers? “That’s true, but it’s good for all the growers of the Côte d’Or. It tells the consumer exactly where the wine comes from. Remember Burgundy is wine of terroir.”
And in Burgundy, terroir is not just for the most exalted properties: Gagey also sees the value in introducing people to Burgundy via the less-famous climats, those that sit next to the great names but are more affordable. “Climats are either famous — Puligny, Gevrey and so forth — or they are the lesser-known villages next to them, such as Vergelesses, Fixin, Saint-Aubin, smaller villages where quality is close to the big names. It’s important to develop these to open the door to the consumer who can’t afford the big names.”
The policy is one of vertical integration: introduce the consumer to Pernand-Vergelesses — “It’s more affordable than Puligny” — and eventually they will graduate to the higher level. Last year Jadot bought the Prieur-Brunet estate in Santenay, an appellation whose wines are described by Wine-Searcher as “leaning more towards rustic than refined”. Gagey gives the impression he knows exactly what he’s doing: what is considered rustic today may be tomorrow’s icon. Remember, 100 years ago, Cru Beaujolais was fetching much higher prices than Grand Cru Beaune.
During the Hospices last year, Gagey gave lunch to a group of buyers and journalists in the Couvent des Jacobins, the lovely old building dating back to 1477 that is used for receptions. The wooden roof, of a style called bateau renversé, is astonishingly fine. Gagey has just had it restored and likes to direct his guests’ gaze upwards to the intricate, ancient woodwork.
“We have been producing wine for 2000 years so we are alive to new possibilities,” he says, in an apparent self-contradiction. “I am conservative, but I am modern and open to new ideas. Louis Jadot is a company which respects traditional Burgundy — we must respect the previous generations — but we trust young people and we like to be challenged.”
Burgundians, like the British at their best, understand perfectly how to make the most of their illustrious past.