The Minister of the Economy assured that 75 industrial groups had undertaken to lower the prices of several hundred everyday food products from next month. The details of the products are not yet known.
THE “prices will drop”, but how exactly? At least 75 major food manufacturers have pledged to lower the prices of hundreds of products affected by soaring inflation, Bruno Le Maire announced Friday, June 9, on BFMTV. “I tell the French that from July, on a certain number of references and products, the prices will drop”, said the Minister of the Economy. What terms are behind this announcement? Which products are affected? Franceinfo answers the questions that arise.
1 Which products are affected by these price reductions?
The initiative concerns “several hundred everyday consumer products”, said Bruno Le Maire. Among the products concerned, the Minister cited pasta, poultry, cereals and even oils, that is to say those whose “Wholesale market prices are falling”. The details are not yet known, but a complete list must be sent to the government “next week”, added the Minister, who expects a drop “from 2, 3, 5, maybe up to 10% on certain products”.
2 Which manufacturers have agreed to negotiate with the government?
The Minister of the Economy did not detail the list of the 75 agri-food groups concerned by these commitments, but he cited Coca-Cola, Mondelez (Lu, Milka, Heudebert, etc.) or Nestlé. He added that these industrialists had also committed to reopening trade negotiations with supermarkets on contracts concluded for 2023. Good news for consumers, as prices are normally set for the year, after negotiations between distributors and industrialists. .
3 How is this reduction financed?
If inflation is down, at 5.1% in May over one year, that of food products still reached 14.1%, according to INSEE. To finance price reductions, manufacturers have agreed to anticipate the impact of lower wholesale prices on certain raw materials, such as wheat. “When wholesale prices drop, (…) it sometimes takes three months, four months, five months before the price of the products concerned (…) also drops”, explained Bruno Le Maire. The Minister claimed that the agri-food groups had accepted “early indexation”, without which the fall in wholesale prices would only have been passed on “around September, October, or even a little later”.
4 How will the government be able to ensure that these reductions are implemented?
“We will check with Fraud Prevention that the commitment of manufacturers is kept. Trust is good, control is even better”promised Bruno Le Maire. At the beginning of the week, the Minister of the Economy had also threatened on France 5 to publish the list of industrialists “who did not want to lower retail prices while wholesale prices are falling”. The Bercy tenant had even promised to use “the tax tool to search the margins of large manufacturers, which are high and recovering”. “I dare to hope that I will not have to draw this tax weapon”he however nuanced Friday on BFMTV.