French tighten belts as supermarket prices soar

Government putting pressure on producers to cut prices
calendar icon 1 June 2023
clock icon 3 minute read

France prides itself on taking its food seriously, but many consumers are now tightening their belts or skimping on quality, hit by a record inflation rate that threatens to serve up another political headache for the government, reported Reuters.

Adjusted for inflation, household spending on food fell year on year by a record 10% in April, to its lowest since March 2009, data from statistics agency INSEE showed on Wednesday.

That followed a near 16% annual increase in food prices - another record - in March. The rate eased back in May, but only to a still appetite-killing 14%.

"I go for the cheapest things, things on sale or generic brands. I compare prices per kilo or per item, which I didn't necessarily do before," Sandra Hamadouche, a 38-year-old mother of two, told Reuters in the Paris suburb of Joinville-Le-Pont.

That changing pattern of behaviour is increasingly common.

Eight out of 10 French consumers have adapted their food shopping habits in recent months, according to a May 9-10 survey by pollsters Elabe.

Some 55% said they had stopped buying certain products altogether and 44% had switched to cheaper products, cutting back particularly on meat and fish.

Food prices spiked after producers and retailers, in annual negotiations, agreed in March to an average 10% increase in prices, responding to a surge in input prices and wages after Russia's February 2022 invasion of Ukraine.

Food companies under fire 

The negotiations are required by law and are supposed to keep farmers from getting squeezed by the companies they supply.

But the system is now causing political ructions, as big swings in raw material and energy prices over the last year mean that more recent drops in the cost of basics such as wheat and animal feed are not yet filtering through to consumers.

Finance Minister Bruno Le Maire said that while retailers were limiting price increases, the 75 big food producers that make 80% of what the French eat were failing to live up to a recent promise to re-open price negotiations.

"Either the big food companies keep their promises in the coming days or I will use taxes to recover the profits that they should be passing onto consumers," he told France Inter radio on Wednesday.

The producers say they have had to contend with higher energy prices and wage increases, but some, including French chicken group LDC, have reaped bumper profits over the past year.

The company told Reuters that lower feed costs had led it to cut selling prices in supermarkets by 2% this month and that further cuts were planned.

Under pressure after forcing through an unpopular increase in the retirement age, President Emmanuel Macron's government is eager to be seen tackling citizens' everyday problems, with surging food prices high on the list.

France is not alone in its concern, with governments in countries ranging from Italy to Britain also considering exceptional measures to rein in food price inflation.

While Macron and his team try to strong-arm producers into lowering prices, consumers see few options in the short term.

"The first thing is to cut back on expensive products, eat less red meat, a bit less alcohol," said relaxation therapist Daniel Dotti, another Joinville-Le-Pont shopper.

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