“Impenetrable wall of inflation in food production”

France: Coopération Agricole calls for a Sovereignty Pact

Since 2021, the food sector has been experiencing the worst inflationary crisis in over 40 years on all agricultural and agri-food production costs. In addition to this, there is growing concern regarding the availability of raw materials and the labor to transform them, which would threaten the continuity of the production activities. It is therefore urgent to react in order to ensure the food security of the French nation.

The risk of a production stoppage or failure of the agri-food industries has never been so real. No company is spared by this major crisis affecting prices and the availability of inputs (50% of the ammonium nitrate production capacity in Europe has been shut down), raw materials (-50% of bean production volumes and -4% of milk production volumes), energy (+350% cumulative increase since 2021 for the price of natural gas and electricity) and packaging (+40% for plastics and cardboard).

Among all these increases, energy is the most important expense for companies. Energy bills are now such that they cannot be absorbed by the cooperatives. If we want to continue to eat French products, we are in urgent need of:

The recognition of agricultural and agri-food activities as fulfilling a mission of general interest,
The revision of the eligibility criteria for the support of the companies’ energy bills,
The implementation of a more efficient energy shield,
The indexation of energy costs when fixing food prices.

Simultaneously, we will have to act at the level of trade negotiations because the inflation of food production costs must be taken into account in the setting of food prices. This is why we urgently ask for:

The modification of the temporality of trade negotiations. It must be possible to discuss prices again according to the inflation or deflation of production costs,
The implementation of a ban on logistics penalties,
The inclusion of industrial costs in the evolution of product prices by means of indicators on the various cost items (energy first, followed by packaging, logistics costs…).

“The situation is serious: the historical inflation of production costs we are currently experiencing is a real threat to the companies’ ability to maintain their production activities. We must react quickly to ensure the food security of the French nation. In order to face this impenetrable wall, we must make it a priority to ensure the availability of energy for food companies and to limit its cost,” explains Dominique Chargé, president of Coopération Agricole.

“We have built our supply chains on the basis of a stable and abundant world, but the shift to a situation marked by instability and probable shortages requires us to change our paradigm. It is in this sense that Coopération Agricole hopes that, in addition to the future law on agricultural orientation, a sovereignty pact can be concluded between the actors of the food sector, the public authorities and the consumers. The collective commitment brought about by the signature of such a pact would ensure the maintenance of a French food chain that is resilient, sustainable and durable.”

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