The price of food products paid to manufacturers will increase by around 3% in France in 2022 after difficult annual negotiations with distributors, the government said on Wednesday.
A first since 2014, under the effect of inflation.
These negotiations, which set the price of the products marketed for the year, ended for some early Wednesday morning, with a signature rate exceeding 80% in most brands, the day after the closing.
However, blockages remain at the level of two major distributors, which the government did not wish to name.
An “Egalim 2 effect”
The exact increase is not yet known, but the Ministry of Agriculture confirms that it will be around 3% after eight years of deflation (0.1% in 2021, 0.3% in 2020), with differences depending on the sector.
To pass on the inflation that weighs on agricultural raw materials and industrial costs (energy, packaging, transport), the main agrifood organization, Ania, had called for an increase in selling prices of around 6%.
The Ministry of Agriculture welcomed an "Egalim 2 effect" on these negotiations, in reference to the text of the law, which was just adapted at the end of 2021 to correctly compensate producers in the face of rising agricultural costs, and thus correct the lack of efficiency of the Egalim 1 law. "Without Egalim 2, it would be a disaster as we speak," said Agriculture Minister Julien Denormandie on Tuesday.
The mediator of agricultural trade relations, for its part, has been seized of around sixty files from companies that have not reached an agreement, a number slightly higher than last year.
An inevitable price increase
In the event of a breach of contract with a supplier, “I invite the general managers of large retail chains to make known their position on the prices to be applied in 2022”, he indicated.
He fears that the brands will maintain the same prices as in 2021 during a notice period which can last up to 12 months, an “unfair” attitude compared to those who have signed agreements.
The balance of these trade negotiations, conducted each year, is delicate: it must allow farmers to live from their work, manufacturers to continue to produce and invest, all without hurting household budgets.
The acceleration of inflation in 2021 (+1.6%) will worsen further following the invasion of Ukraine by Russia, which caused the world grain and oilseed prices at historically high levels, with the two countries representing between them 30% of world wheat trade.
Jean-Philippe André, president of Ania, indicated on Wednesday on BFM Business that he anticipated "a second shock of rising costs" and that the rise in these raw materials "will be passed on in prices".
"Inevitably, we will be impacted like other European countries by the Ukrainian crisis," he insisted.
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