Foodwatch, Familles Rurales, UFC-Que Choisir and CLCV are denouncing the excessive margins in supermarkets. The 4 consumer associations decided to call on the French government at the end of November, citing a “scandal of the two-tier system behind the soaring food prices.” In their view, “two-thirds of the food inflation” would be “due to excessive profits.”
Significant profit on fruit and vegetables?
Nadia Ziane, head of consumer affairs at Familles Rurales, explained to France Info on November 29th that “supermarkets are making substantial profit on fruit and vegetables (247 million euros [267 million USD] in 2021). They are making up for the deficit in other departments (pastries, for example) with the profit made on fruit and vegetables.”
“Aggravated by an inflation of over 20% on food products in 2 years, food insecurity is hitting millions of people hard, and the numbers keep rising. Faced with soaring prices, almost one in three French people (29%) say they have to skip a meal for lack of money, and 43% (55% in rural areas) say they have already stopped buying some food products due to a lack of means,” according to a study by Familles Rurales in June 2023. In its 2023 Fruit and Vegetable Price Observatory, the association revealed a 16% increase in the price of their conventional basket of 19 fruit and vegetables in one year, which is 3.5 times higher than the general inflation.
For the president of ANIA (French National Association of Food Industries), interviewed on France Info, “there are no excessive profits” on the part of supermarkets, which are also suffering from inflation and declining volumes and sales. He pointed out that the price of agricultural raw materials has risen since 2020, along with energy and packaging costs.
What do fruit and vegetable professionals think?
The subject is controversial. Some professionals have been denouncing these practices for several years, with in-store actions, while others (interviewed last week) do not believe that supermarkets make such high margins on the fruit and vegetable section.
“Obviously, the problem of supermarket margins is not new, and it all depends on the product category in question. But there are a few nuances to this. While supermarkets can make such large profits on some departments, it is unlikely to be the case for fruit and vegetables, which are premium products. Products such as potatoes and carrots, for example, are basic food products that distributors are obliged to offer on their shelves, and these are not the references that retailers can make profit on. For some specific fruits, such as exotic or PGI products, it is possible to make slightly higher margins, especially during certain periods of the year.”
What are the associations asking for?
The associations’ demands to the government include:
- total and immediate transparency on the net margins per product achieved by the agri-food giants and supermarkets,” as making “margins public should discourage abuses.”
- limiting excessive margins by regulating them. “Concrete measures to make excessive margins on essential, healthy and sustainable food products by both manufacturers and retailers impossible - starting with those recommended by the French National Nutrition and Health Program (PNNS), such as raw produce, fruit and vegetables, pulses and cereal products, especially those grown organically.”