2023-08-28 11:39:08
“I can, with some certainty, assure you that at the start of the school year we will have a visible drop in prices on the “food” shelves, assured the Minister Delegate for Trade Olivia Grégoire at the end of April.
But the observation drawn up by the Minister of the Economy Bruno Le Maire is more nuanced. “I had indicated that inflation would start to slow in the summer of 2023. We are there,” he assured at the end of last week.
According to INSEE, food prices were 12.7% higher in July than a year earlier, a slight slowdown compared to June (+13.7%).
A reduction in the level of inflation does not, however, correspond to a price drop on the shelves, but to a slower increase.
Moreover, prices had already started to climb a year ago, in the wake of the Russian invasion of Ukraine. In total over two years, inflation in supermarkets is more than 21%, recently recalled the specialized media LSA associated with the panelist Circana.
Inflation “durable”
“Inflation will be sustainable, and this is a new parameter that will have to be taken into account,” observed Dominique Schelcher, CEO of the 4th player in French distribution, System U, in a column published Monday on LinkedIn. “Yes, the peak of inflation is behind us, but (…) prices will not return to pre-crisis levels”.
At the end of April, Olivia Grégoire hoped that prices could drop following renegotiations between distributors and agri-food manufacturers. Each year, supermarkets and their agro-industrial suppliers negotiate from December until March 1 the conditions of sale for a large part of the products sold throughout the rest of the year in supermarkets.
During the last episode concluded last March, the average price paid by supermarkets to manufacturers rose by 9%. But the price of a number of raw materials has since fallen and the government has called on the various parties to get back around the negotiating table.
“Very few industrialists played the game, almost none wanted to renegotiate and 15 to 20 of them agreed to temporary price reductions on a limited number of products, which is very clearly insufficient”, estimated Monday with AFP Jacques Creyssel, general delegate of the employers’ organization representing the sector, the FCD.
Meeting at Bercy
Manufacturers explained before the summer that they had committed to an “effort”, generally in the form of temporary promotions, on the price of “about 1,000 products” from major brands, such as Coca-Cola for example. In the case of the famous soda, 10% discounts have been granted since August 1 and for three months, but only on certain references, without sugar and in large bottles.
The number of products concerned is also to be compared with the number of references in stores: 3,000 to 5,000 in a supermarket, and between 20,000 and 35,000 in hypermarkets.
Before the industrialists, the supermarkets had for their part committed in mid-March, within the framework of a non-binding commercial operation called “anti-inflation quarter” – since extended -, to sell a selection of products left to their discretion, at the “lowest possible price”.
“I will bring manufacturers and distributors together with Olivia Grégoire this week to ask them to extend their operations, which have worked,” Bruno Le Maire explained on France Inter on Monday.
His office specifies that the distributors have an appointment on Wednesday morning at the Ministry of the Economy, the industrialists on Thursday.
The government plans to ask to “expand to a greater number of products” the promotional operations, and hopes to convince more industrialists to commit to a “lower price”.
Otherwise, “we are entering the budget period”, expected at the end of September, “we have instruments at our disposal so that everyone plays the game”, specified Bruno Le Maire.
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