2024-02-14 07:14:00
In France, this ban falls under the Egalim law, the first version of which came into force in 2018. A law aiming, among other things, to remunerate producers fairly to allow them to live with dignity from their work. In its second version, the EGalim law introduced a ban on supermarkets offering more than 34% reduction on food products and a maximum of 25% promotions on the entire assortment. This Egalim law will be extended from March 1, by imposing the same restrictions on non-food products. A way to prevent mega-promotions like 1+2 free or -80% like French distributors were used to.
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However, it must be noted that this law has not fully borne fruit. It is even at the center of the anger of French farmers who have taken to the streets for several weeks. In fact, the text of the law supposed to guarantee them better remuneration in the context of negotiations between manufacturers and supermarkets would be little applied. At the end of January, as negotiations between distributors and producers were coming to an end, the French government imposed sanctions on three companies that failed to comply with these laws.
In Belgium, Comeos prefers not to comment on the possible repercussions of the implementation of a law aimed at prohibiting mega-promotions. Just a year ago, CD&V MP Leen Dierick had already tabled a bill aimed at banning free 1+1 type promotions, with the Flemish Farmers’ Association and Unizo, the Union of Flemish independent entrepreneurs. A proposed law aimed in particular at combating food waste. “This free product, received with the purchase of another, is not always “necessary”. These promotions devalue the work of producers, who must cut back on their margins to be able to offer such low prices to supermarkets and retailers “This would also allow small traders, butchers and bakers in particular, to become a little more competitive again in the face of the cut prices of large-scale distribution,” according to the MP. Comeos then expressed reservations, fearing that such a measure would lead to a flight of customers to our neighbors, where prices are often cheaper than here.
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The United Federation of Breeders and Farmers Groups (Fugea) also remains mixed on the results of the Egalim law. “It can contribute to better remuneration for farmers and breeders, but it does not guarantee this. Eliminating mega-promotions does not necessarily mean paying farmers better. And if, in the end, this leads to increasing the price on the shelves without offering better remuneration to farmers, this will only inflate the profits of manufacturers and mass retailers”, explains Philippe Duvivier, president of Fugea.
And also to demand that we put an end to a practice which causes enormous harm to farmers. “It is not normal for certain farm products to be attractive products in mass distribution. We must therefore prohibit the purchase of agricultural products below their cost price. And we no longer want to hear that “With each price increase, it is the consumers who suffer the repercussions. We saw this with the milk crisis in 2016. In the end, it was the consumers who paid the difference. What we are also asking for is “is more clarity on the distribution of margins in the links of processing and distribution.”
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For the Fugea, taking inspiration from the Spanish model would be a good thing. “We brought the solution to the table, but neither the politician, nor the unions, nor the Boerenbond seemed aware of the measures that were taken in Spain. At the MR, we were told “yes-yes, we are going to do something thing”, but we clearly feel that we are at the end of the legislature. We have shortened the schedule of meetings of the food task force so that we can put forward solutions by March 1. But after that? Will ‘We are not going to witness the unpacking of a catalog of good intentions on the part of politicians to show off at the end of the legislature? And then, how long will we have to wait for this to materialize, that? Should we enshrine this in law? The worst scenario would be that the next government does not implement anything under the pretext that it did not commit under the previous legislature.”
This Spanish model put forward by Fugea is above all the guarantee of a stable price. “We must put in place a tool which guarantees a fair price for the producer and, above all, which is not below production costs. But that is not all because if we decide, for example, to set the price of wheat at €180 per tonne and we continue to import wheat from Ukraine at €120 per tonne, we will no longer sell anything. We need a set of measures and limit imports to promote supplies from producers This is why it is necessary to indicate the origin of food products (raw and processed) in stores and to have large retailers sign a charter to oblige them to obtain Belgian products as a priority.”
If large retailers have announced that they agree to increase their purchase price of beef from producers, Fugea believes that “this is smoke and mirrors. This only concerns hyper-meaty carcasses. What is needed is a solution for the entire sector. Furthermore, we are talking about 50 cents more per kilo of carcass, but in reality, we will not even get there because we also have to pay the other links of the chain. With this announcement, the distributors are trying to improve their image, but it’s a real flop.”
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