Asked by - Laitmass Schmidtschneider - 14th June, 2020
"The shortage exists because there was an unprecedented spike in Hennessy sales in the first quarter of 2017. The unexpected demand depleted the supply. According to Cognac.com: While LVMH revenues from the United States grew at a lower pace than other global regions, sales of Hennessy cognac skyrocketed.
Beside this, is there a Hennessy shortage?
There's a Hennessy Shortage. In April of 2017, executives from Hennessy announced that a possible Hennessy shortage could happen by the end of the year. By October, that shortage was confirmed, and suddenly people were very aware of the lack of bottles on store shelves.
Furthermore, why is Hennessy so expensive? Distilling other liquors is much less expensive than distilling cognac. 90% of other liquors are produced using distilling procedures where the cost is very low. But with cognac it's the opposite: Distilling wine from grape juice is a long and complicated process. Also, the alcohol comes from grapes – not grain.
Besides, will we run out of cognac?
The world's supply of cognac is running low. Part of that is because LVMH would rather hold on to the stuff and sell it later in China, where consumers prefer aged cognacs and pay roughly three times the U.S. price per bottle. Production can't be ramped up quickly. Cognac needs at least two years of aging".
Read More: Say What? A shortage of Hennessy?