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Cognac, an alcoholic beverage produced in a specific region of western France, is actually a type of brandy. In order to determine its quality grade, cognac is split into very special (VS), very special old pale (VSOP), and extra old (XO) grades, depending principally on length of time spent aging in casks. The price of cognac depends on the grade. Expensive cognac has been aged much longer, sometimes decades or even more than a century.
The beverage starts as double-distilled wine. After distillation, cognac is aged in wood casks. For a beverage to be properly labeled as cognac, its producers must follow French regulations regarding ingredients, distillation, and aging.
VS cognac is considered so after two years of cask aging. After four years, cognac receives the grade VSOP. In order for a cognac to be labeled as XO, it must have been cask aged for at least six years.
Achieving a perfect blend is one hallmark of expensive cognac. The bottle in which the cognac is purchased sets expensive cognac apart from other high quality cognacs. For their finest and most expensive cognac, producers will often hire a designer with the sole purpose of making the bottle itself an expensive work of art.
Super premium, artfully packaged cognacs can cost anywhere from 40 to 250 times as much as a low-end cognac. Within this class some difference can still be found, and ultimately these bottles are an expression of personal and artistic taste. Expensive cognacs can cost more than 100 times as much as an average XO grade cognac. One such example of high-end expensive cognac comes from a French producer who blends three cognacs, each aged for over 40 years, and packaged in a decanter designed specially by a French artist.
More expensive and extravagant examples of cognac can be found. In the case of the most expensive cognac, it may be prudent to examine whether the true worth lies in the beverage or the container in which it resides. Esteemed producers often create special or limited editions made of blends of cognacs aged from 40 to 100 years. Reserve or heritage editions may be the true cream of the crop. The sometimes relatively small bottles or decanters for the premier and supreme cognac blends, aged in barrels for over 100 years, are known to have pounds of gold or silver, and are sometimes embellished and studded with thousands of diamonds.