Farmers place labels “Made with milk sold at a loss” on a product from the agri-food group Savencia in a supermarket in Rodez, Aveyron, August 18, 2015 (AFP/Archives/PASCAL PAVANI)
An “avant-garde” legal fight: the dispute between the agri-food juggernaut Savencia and the producers’ association Sunlait is being scrutinized by the entire French dairy industry, with breeders denouncing “low blows” and “undermining work” , while the industrialist denies any “illegal pressure”.
On his farm near Saint-James (Manche), Landry Rivière takes up the chronology of a conflict which begins with a “story that is a little too beautiful”.
In 2018, Savencia and Sunlait agreed on a “price formula, to respect the Egalim law”, he recalls. “An unprecedented contract, the first in France.”
Adopted the same year, the Egalim law aims to pay the fair price to producers, in particular by taking into account production costs. The contract and associated prices must be proposed by the farmers.
Sunlait, which produces nearly 600 million liters of milk per year, represents 17% of Savencia’s supply. Savencia, for its part, is the sole client of these thousand breeders united in an association of producer organizations (AOP).
– Unilateral price –
The breeders of Ouest’Lait, one of the six producer organizations (PO) members of Sunlait, then saw the price soar above the national average: unlike Savencia, the other manufacturers did not respect the law Equal.
When “Savencia understood that they were paying us more than its competitors, in 2019 they denounced the memorandum of understanding to impose a unilateral price,” explains Mr. Rivière.
Sunlait and Savencia then carry out several rounds of mediation, which fail. “We were facing a wall,” laments Arnaud Laurent, treasurer of Sunlait. “For them, an OP stays silent, accepts the price.”
Producers block an Elle & Vire truck, a subsidiary of the Savencia group, in Isigny-le-Buat, in Manche, January 29, 2024 (AFP/Archives/Lou BENOIST)
In 2021, the AOP took Savencia to court for non-compliance with the contract. Then begins a legal fight “a la David against Goliath”, says the president of Sunlait, Loïc Delage.
The group is the 2nd largest cheese maker in France, 5th worldwide, with more than 25,000 employees worldwide, 6.5 billion euros in turnover in 2022 thanks to brands such as Tartare, Cœur de Lion, etc.
In March 2022, Savencia denounced the framework agreement linking it to Sunlait. The dialogue gets worse.
Then in August, the Coutances judicial court ordered Savencia to pay 25.9 million euros to Sunlait: the group “cannot invoke the behavior of its competitors to free itself from its contractual commitments”, he explains.
“That’s when Savencia started to make us pay for daring to subpoena them, with undermining work (…) low blows,” says Mr. Laurent.
– Pressures –
Farmers place labels “Made with milk sold at a loss” on a product from the agri-food group Savencia in a supermarket in Rodez, Aveyron, August 18, 2015 (AFP/Archives/PASCAL PAVANI)
Nearly a dozen breeders interviewed by AFP said they were “being pressured” by the group, with the aim of leaving Sunlait.
Benjamin Aubry, a 34-year-old milk producer, has been waiting for more than a year for a certificate indicating the number of liters of milk supplied to the dairy. Without this certificate, banks do not lend and projects stagnate. “Savencia tells me that if I get out of Sunlait it will be easier.”
Another breeder from Normandy relates “constant pressure so that[elle] resigns from Sunlait (…), difficult to bear”. For fear of “retaliation”, she wants to remain anonymous. “Savencia is billions of euros. If they want to break me, they will break me.”
Each time, the same phrase comes up: Savencia “divide and conquer”.
Because Savencia cannot do without Sunlait milk: milk production is falling in France, explains Olivier Carvin, agroeconomist at the Chamber of Agriculture of Brittany.
His “strategy is to short-circuit the relationship with the AOP to enter into contracts directly with breeders,” he explains.
However, concluding an individual contract with a producer when a framework agreement already exists is “illegal”, assures Fabien Barthe, rural law lawyer, who fears “a form of abuse of economic imbalance”.
Accusations refuted by Savencia. The group only exposed producers to “the field of possibilities” outside of Sunlait, Sophie Godet-Morisseau, general manager of Savencia Ressources Laitières, explains to AFP.
“In no case have we circumvented collective bargaining, we have not put pressure on producers (…) nor proposed solutions that are illegal,” she insists.
If the breeders felt it as “pressure”, it is because they are “worried” about the situation caused by the current legal procedure, which “is not our initiative”.
Informed, the Fraud Repression Services (DGCCRF) say they are at the “diagnosis” stage.
– “Intolerable” –
In December, the Caen Court of Appeal overturned the decision rendered and ruled “completely in favor of Savencia”, underlines Ms. Godet-Morisseau.
Savencia cannot “have a milk price significantly disconnected from the market, more than 20 euros (without) losing market share” to the benefit of its competitors Lactalis and Sodiaal, she explains.
There has been “disagreement for five years”. “Even if we have a price slightly higher than the major market players – 1.5% over the last few years – we cannot go beyond that.”
A few days later, in a letter, the Savencia group announced to breeders the “definitive end of the relationship with Sunlait”.
No negotiations for a new framework agreement therefore. The breeders then fear that once the denunciation of the current agreement takes effect – on March 8 – the breeders’ milk will no longer be collected.
“Alternative solutions to Sunlait exist,” he reminds again.
In January, agricultural discontent took the political world by surprise. Sunlait producers are not left out and some demonstrate in front of Savencia dairies. But on the farms, panic is spreading: will thousands of liters of milk have to be thrown away?
The senator from Dordogne Marie-Claude Varaillas denounces to the Senate “intolerable pressure” and “blackmail of collection” on the part of Savencia.
Seized by Sunlait, the Committee for the Settlement of Agricultural Commercial Disputes (CRDCA), of which this is the first referral since its creation by the Egalim law, decides.
On February 20, he declared that a “contract compliant with the Egalim law must include a price” and obliged Savencia to extend the framework agreement until October 31, 2024. A seven-month reprieve for proven breeders.
“Savencia wants conciliatory POs,” reprimands Mr. Rivière. “But we are not here to make up the numbers, we are here to enforce contracts.”
“I hope that there will be a before and after in the relationship between the POs and the agri-food groups,” confides the breeder.
“If our fight can make OPs want to fight for a decent price, that will already be a small victory.”
© 2024 AFP
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