Monday, 24 January, 2022

Food law: the battle rages on the results of trade negotiations


“We do not judge after two months of the effectiveness of a two-year experimental device.” Thursday April 4, before the Senate Economic Affairs Committee, Secretary of State to the Minister of Economy and Finance Agnès Pannier-Runacher immediately took precautions to talk about the first effects of the Food Law. A month after the end of commercial negotiations with large-scale distribution concerning national brands, the question of the balance sheet is on everyone’s lips. Because the EGalim law was intended to better distribute value between producers, manufacturers and distributors.

According to Agnès Pannier-Runacher, the 300 checks carried out on the quality of trade negotiations “show a more positive trend”. “The general climate shows that distributors have adopted a more constructive and less aggressive behavior, especially with SMEs”, indicates the Secretary of State, adding that “the requests for deflations of distributors are almost twice lower than the last year”. She sees it as a “positive signal” even if she recognizes that “reprehensible behavior is always to be deplored”.

“The price war continues”

At each level of the food chain, from producer to distributor, the actors did not wait for Agnès Pannier-Runacher’s words to pass their own judgment. Skirmishes at stake. L’Ania, the national association of food industries, drew on Wednesday, the day before the hearing of the Secretary of State in the Senate. In a statement on the occasion of its annual economic press conference, Ania regretted that “once again this year, trade negotiations continue to focus solely on price”. And the association to specify

that nearly one in two companies has signed for deflation and that “for all companies, deflation is 0.5% in 2019”. Agnès Pannier-Runacher mentioned a drop in prices of 0.27%.

“Where did the 600 million euros earned by distributors go from the SRP increase? [seuil de revente à perte, le prix en-dessous duquel un distributeur n’a pas le droit de revendre un produit, NDLR]? “wondered in the press release Richard Girardot, the president of Ania.” Today, neither the food companies, nor the farmers have seen the shadow of a penny. “Same question. and even observation drawn up three days before by Coop de France, which brings together 2,400 cooperative companies.

“The price war continues”, points out the organization adding that “the account is not on the revaluation of tariffs, cow’s milk is indeed ‘the tree which has hidden the forest’”. Because progress has indeed been made in the dairy sector, with a great deal of support from the signing of highly publicized agreements with major distributors. But Dominique Chargé, the president of Coop de France, was worried about the fate of other sectors with Challenges, already a month ago. And raised the issue of negotiations for private labels (private labels) since some of them had announced their intention to lower the prices of their private label products in response to the increase on certain national brand products linked to the raising of the SRP.

“Total lack of transparency from industry”

The Ania, Coop de France and the FNSEA all deplore in their communication the continuation of the price war. Opposite, the large distribution did not remain silent. On Wednesday, after the severe press release from Ania, the Federation of Commerce and Distribution, which brings together most of the retail chains, gave a scathing response, regretting “the biased and totally oriented character” of the study presented by Ania. “The publication of such a study is in reality only intended to hide the total lack of transparency of the industrialists on the returns of the increases granted, towards the agricultural producers”, continues the press release of the FCD, calling for “a change urgent behavior of representatives of large multinational agrifood companies “for more dialogue and transparency.

While waiting for the very recent commission of inquiry of the National Assembly “on the situation and the practices of the large distribution and its groups in their commercial relations with the suppliers” takes up this question of the negotiations, Agnès Pannier- Runacher recalled Thursday, in front of the senators, that 6,000 checks of the correct application of the EGalim law will be carried out by the DGCCRF in 2019. 1,300 have already taken place.

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