France: Low tides at Packer LPC

The Loire Packaging Company (LPC) in La Chapelle d'Aligné (Sarthe), is having difficulties operating at full capacity. Due to the economic decline the company has made almost no profits this year. In the fiscal year 2011/12 LPC processed 12,600 tons of top fruit, almost 2,000 tons less than it should be. According to CEO Gildas Cariou there are multiple culprits.

First, there’s Europe’s competitive market. Recently, LPC lost a 1,500-ton deal with British supermarkets: the apples were instead processed in England, where wages are lower. And then there’s the company’s chief supplier, Scica Pomanjou, who likewise decided to transfer some of its business to British packers. Countries like Holland and Germany increasingly choose to handle crops domestically.

A fluctuating global market also adds to the problem. Normally LPC has a lot of business coming in from South Africa, Chile and New Zealand. As EU countries were unwilling to meet asking prices, these countries have now diverted trade to other parts of the world. As a result, Europe is risking a shortage of top fruit in the coming season.

Other contributing causes include the weather, rising wages and an overall decline in domestic produce. The cultivation of apples and pears decreased with 20 to 30% in the Val de Loire alone.

Cariou stated that LPC’s priority is to keep on most of its 70 employees.