Spiraling inflation is not enough to cover soaring production costs, food producers say

Food prices in France may rise significantly starting next year, as producers have asked retailers for double-digit increases on their products, a representative of the French Federation of Trade and Distributors, Jacques Creyssel, said this week.

The demand for product revaluation comes amid spiraling inflation and production costs that are “extremely high”, according to Creyssel. Food producers have requested price hikes of between 15% and 25% for a number of items.

Such an increase is well above the tariffs negotiated last year when manufacturers asked for an average price rise of 7% and agreed on about 3.5%, agricultural trade mediator Thierry Dahan pointed out.

In late November, food inflation in France reached 12%, according to the IRi research agency, but apparently this was not enough to cover surging production costs.

Among other things, manufacturers are seeking to lift prices by 7% for pasta and ham, by 10% for chicken filet, by 26% for candy, and by up to 30% for soda, Creyssel added.

READ MORE: Research reveals Brexit impact on UK consumers

The latest requests for price hikes were triggered by a number of factors including recovery from the COVID-19 pandemic, the conflict in Ukraine, and the avian flu epidemic in France – which together have ramped up the cost of raw materials, energy, packaging and transportation.

Western sanctions imposed on Russia have also added pressure to manufacturing, causing a disruption in supply chains and exacerbating food and energy inflation across the EU.

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Source: RT

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