France’s 75 biggest food producers have agreed to lowering their prices from July, under (not so subtle) pressure from French Economy Minister Bruno Le Maire.
Those who do not comply, face punishment.
Early price revisions
From July, the prices of hundreds of food products should start to decrease. The minister has reached an agreement with 75 food producers to revise their prices downwards early, as wholesale prices begin to fall.
The products in question are food items whose international purchase prices are starting to drop gradually, following the inflation spike in recent months – things like pasta, poultry, cereals and oil. Normally it would take “three, four or five months” for producers to pass on the reduced wholesale prices, but now they agree to an early review. Fifteen major food producers, including Coca-Cola and Unilever, have also agreed to reopen negotiations with supermarkets on contracts for 2023.
Fiscal and public threats
In France, food prices are still 14.1 % higher than a year ago. To protect the population’s purchasing power, Le Maire had already obtained in March that supermarkets would sell a selection of products at the “lowest possible price” for three months. All of them are now also continuing this initiative until the end of the year.
With producers, however, things were more difficult: Le Maire proceeded to issue threats and announced last week that those who did not give in should expect consequences. For instance, the minister would publish the names of those who did not participate by the end of June, in order to publicly humiliate them. He also threatened to cut into their “growing” margins with fiscal measures.