Dangerous month of September for small and medium-sized agri-food companies

Soaring production costs, a third of the renegotiations with distributors still pending, weather hazards, drought, water restrictions, bird flu, unprecedented energy crisis, conflict in Ukraine and international tensions... Small and medium-sized food companies are faced with an unprecedented and worrisome situation.

“Managers of the food sector have never seen such a difficult year!” This statement by Jérôme Foucault, president of ADEPALE, sums up the state of mind and the very strong concerns expressed by the member companies in a survey conducted at the end of August. In that sense, ADEPALE salutes the words of the Ministry of Agriculture and Food Sovereignty, which recently emphasized that “entire sectors of the French agriculture and agri-food industry are in danger of disappearing.” 

Faced with such an unprecedented crisis, French small and medium companies and processing plants call on all actors of the food chain to work in a spirit of responsibility and solidarity in order to avoid the breakdown of agricultural and food companies. 

2022 renegotiations still pending and uncooperative distributors
The survey conducted among the members of ADEPALE reveals that approximately 1/3 of the requests for essential price increases formulated by companies still have not been fully signed. 

This refusal of the distribution to take into account the reality of the current crisis is putting at risk French small and medium-sized agri-food companies which have been confronted for several months with a continuous and unprecedented rise in production costs (energy, agricultural materials, packaging, transport…).

Additionally, the collective and commercial catering market is going through the same tensions and the food companies also need to adjust their prices. 

The practice of abusive logistical penalties continues despite the tensions regarding supply, which does not help the current situation.

Responsibility, solidarity and anticipation for the 2023 negotiations!
As energy prices reach historic highs, it is necessary for manufacturers to be able to adjust their prices automatically. Otherwise, small and medium-sized companies will not be able to survive. ADEPALE’s internal survey reveals that a third of the member companies will see their energy coverage end in December 2022 and will have to face increases of up to + 700%. This catastrophic situation could lead to the closure of some production lines and recourse to partial activity.

Paris, September 5th, 2022. The energy inflationary peak expected for 2023 makes professionals fear the worst for the upcoming commercial negotiations.

The investment capacity of the companies willing to modernize their production tools and commit to ecological transition is at stake and must be maintained. The member companies of ADEPALE have already been very committed to reducing their energy and water consumption for many years, and they continue to strengthen their commitments wherever possible, without affecting food security. But the companies need visibility and anticipation in order to face possible rationing and offloading.

In this context, ADEPALE:

- asks distributors to respect the commitments in the framework of the charter signed last March;

- supports the government’s will to commit right away to a dialogue in order to anticipate the 2023 negotiations which will clearly be particularly tensed;

- proposes to the public authorities the implementation of a system to automatically adjust prices according to energy increases. A simple and fair system that would make the 2023 negotiations more fluid;

- calls for early consultation with the companies affected by potential rationing, in order to give them enough time to adapt their production plans, limit their waste and warn their employees.

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