Negotiations between supermarket brands and some of their agro-industry suppliers end Monday evening (AFP/Archives/Christophe SIMON)
Negotiations between supermarket brands and some of their agro-industry suppliers ended Monday evening, with the usual skirmishes and without presaging massive and widespread price reductions.
The government passed a law in November to bring forward by a few weeks the end of the period of negotiations between distributors and their suppliers, hoping for a quicker impact on the shelves of reductions in certain wholesale prices, oils or wheat but also energy.
Exceptionally, therefore, companies must agree more quickly on the conditions of sale for 2024, by Monday evening for suppliers with less than 350 million euros in turnover and no later than January 31 for suppliers. largest suppliers (Lactalis, Herta, Bonduelle, etc.).
“The negotiations went well, the French manufacturers were rather correct,” declared the media representative of the leader in mass distribution, E.Leclerc, Michel-Edouard Leclerc, on TF1. “I come to you with a rather positive vision of these negotiations.”
“There will be pockets of price reduction and we will reduce food inflation to 2 or 3% per year,” added Michel-Edouard Leclerc, after average price increases of more than 20% in two years.
Conversely, manufacturers have difficulty digesting sometimes having to sell less expensively than last year, arguing that part of their production costs are still increasing.
In a press release, the Association of Processed Food Products Companies (Adepale) states that it has noted “requests for unreasonable price reductions that are disconnected from the cost variations borne by companies”.
“No room for maneuver”
According to the organization, SMEs and ETIs (mid-sized companies) in the food sector had requested price increases that were “moderate (less than 4.5% for the vast majority) and strictly linked to variations in the cost of raw materials agricultural and industrial, energy as well as increases in wages, services (banks, insurance, etc.), interest rates and storage costs.
Adepale is also “worried” about “the future of the Egalim laws”, which were to secure farmers’ income, “since large-scale distribution demonstrates during these negotiations a low sensitivity to the protection of agricultural raw materials”.
The head of the National Federation of Dairy Industries (Fnil), which defends the interests of processors (excluding cooperatives), told AFP that it was “unacceptable and illegal” for large-scale retail buyers to demand reductions “at all costs”. “to dairy SMEs.
The organization’s CEO, François-Xavier Huard, cites Carrefour and Intermarché as poor performers.
According to him, this negotiation risks resulting “mechanically in a reduction in the purchase price of milk” for breeders.
“The purchase of milk represents a little more than 50% of the dairy’s costs, there is no room for maneuver,” he explained.
Commercial negotiations take place each year to determine the conditions of sale (purchase price, shelf space, promotional calendar, etc.) for a large part of the products sold in supermarkets, and usually end on March 1st.
They are traditionally more tense with the biggest players, often multinationals.
Carrefour gave an example the previous week by singling out its supplier PepsiCo, manufacturer of the famous soda but also Lay’s chips and Lipton sweet tea, which it accuses of asking for “unacceptable price increases”.
© 2024 AFP
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