Industrial food producers in France have agreed to reopen price negotiations with supermarkets, ceding to government demands to help ease inflation pressures on consumers.
For the first time, the biggest suppliers will bring forward scheduled talks by several months to May, according to French Finance Minister Bruno Le Maire.
“This is excellent news for consumers,” he said on the sidelines of a visit to a factory south of Paris. “It means prices will be renegotiated down so we can break the inflationary spiral in food by the autumn.”
The minister spoke after meeting with executives from large food and beverage manufacturers including Barilla Holding SpA, Coca-Cola Europacific Partners Plc and Unilever Plc.
Food prices have taken over from energy as the main driver of inflation in the euro area’s second-largest economy. That trend is harder to offset for the government, which spent vast sums intervening in electricity and gas markets but has less direct influence on the cost of feeding families.
It launched a promotional campaign two months ago to encourage retailers to take a hit on their margins by lowering prices on some essential items, but this had no direct effect on suppliers, which normally only negotiate prices periodically.
Le Maire warned that efforts by big food producers to reduce their prices must not hurt farmers or smaller companies, and said the government will follow the negotiations closely to ensure consumers see the benefit.
“We have to get rid of inflation, we have to bring prices down - this is the priority for consumers, households and for the Finance Ministry,” he said.
(Updates with comments from finance minister from seventh paragraph.)
