2023-07-05 14:25:38
Will fall, won’t fall? Bercy is watching the labels of food products in supermarkets like milk on fire at the start of July, during which a hundred references and products must see their prices drop on the shelves, Bruno Le Maire announced on June 9. : pasta, poultry, cereals or even oils…
While the battle to reduce – or at least contain – the price of the average household basket remains a priority for the government, Bercy considers that the reduction in the prices of certain raw materials (such as wheat), energy as well as sea freight, has given agri-food manufacturers some leeway to adjust their prices.
Deconsumption and dialogue between manufacturers
In mid-May, the ministry urged them to reopen trade negotiations with supermarkets to this effect. “Industrialists had accepted the principle, recalls consultant Frank Rosenthal, but under such restrictive conditions that in reality only a handful actually got back around the table. » A finding confirmed by several bosses of major brands, including System U and Leclerc.
“However, we must resume the dialogue, argues Frank Rosenthal, as was done last year in the opposite direction so that industrialists could incorporate the soaring cost of energy and agricultural raw materials into their selling prices. » In his view, it is now in everyone’s interest to review the situation. Not only because of government pressure but also and above all in view of the signs of a drop in consumption sent by households in recent months.
Old contracts with suppliers
« LFood prices are starting to decelerate but they remain high, recounts Gaëlle Le Floch, at Kantar WorldPanel France (read the marks). The operation of “anti-inflation quarter” proposed in March to supermarkets by the government, and renewed since, has proved to be rather effective. »
“The prices charged by the agri-food industries won’t go down right away, provides an expert in the file, because they partly depend on old contracts with their suppliers, who therefore do not yet integrate the current declines on the wholesale markets. »
Julien Pouget, at INSEE, points out that there have been on the part of agrifood manufacturers “a catch-up phenomenon. At the end of 2021, their margin rate was about ten points lower than its 2018 level, a sign that these companies have compressed their margins, before recovering them during 2022. At the beginning of 2023, it was thus nearly ten points above its level. of 2018. This catch-up should now settle down. If not, then it could be the start of a more inflationary process. »
Foods that could have cost more
At this stage, food would have cost even more if manufacturers and distributors had not crushed their margins. This is the conclusion of the Official Observatory of the formation of food prices and margins, chaired by economist Philippe Chalmin, in its report published at the end of June.
At Bercy in any case, we promise to check the effectiveness of the reduction in certain prices on the shelves, and to sanction if necessary. The ministry threatens industrialists with “name and shame” for those who do not play the game, not without having questioned them beforehand. “We’re not going to throw names in the dumps lightly, we know some companies can’t afford to lower their prices but we also know others can.” we say to the ministry. And also to agitate, in the face of manufacturers, the threat of using, if necessary, “tax tool”.
Need to change the system
For Dominique Schelcher, head of System U, “the most important line to move is to change the system of trade negotiations”. All observers agree: the French regulations, which freeze the negotiations in a period between December 1 and March 31, are too rigid. “France is the only one in Europe to operate in this way, emphasizes Philippe Goetzmann, specialist in mass distribution. This framework does not allow for competition between players and does not allow prices to be adjusted according to the context. »
An increasingly uncertain context, underlines Gaëlle Le Floch, according to whom food prices have not finished spilling ink: “The problems with supply chains and the spike in the cost of raw materials that we experienced coming out of Covid are not over, and will recur regularly. The cheap and plentiful food we have grown accustomed to in the West is a thing of the past. »
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Evolution of prices and margins in food
According to an INSEE note of June 15, the prices at which farmers sell their production (excluding fruit and vegetables) increased by 23% in 2022 over one year. At the same time, selling prices for manufacturers and distributors increased to a lesser extent, by 16% and 17% respectively (excluding fresh products).
In June, food prices increased by 13.6% compared to June 2022 according to INSEE, after + 14.3% in May and + 15% in April, i.e. the third consecutive month of lower increase.
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