French Food Companies Pledge to Cut Prices on Hundreds of Products
French finance minister Bruno Le Maire said on Friday that major French food companies, including Unilever, have pledged to cut prices on hundreds of products from next month and have threatened monetary sanctions if they break their promise.
The government is very upset after the prices of goods purchased by consumers in retail stores reached a record level in recent months, despite the decline in prices for many raw materials purchased by companies.
Le Maire has previously threatened to exact what he called “improper” profits from food companies by imposing special taxes on them unless the benefits of lower commodity prices are passed on to consumers who are already suffering from higher electricity bills.
Prices to Drop by July
“Prices for some products will drop by July,” Le Maire told BFM on Friday after meeting with food companies yesterday.
He added: “Supervision and fines will be applied to those who do not follow the rules,” noting that the prices of some products, such as pasta, poultry and vegetable oils, will be reduced.
Le Maire said that if the food companies, which produce 80% of 75 French food products, fail to deliver on their promise, they will be revealed to the public and embarrassed.
Lower Retail Prices Expected
“As wholesale prices for a number of items are down, (retail) prices should also be down by 2, 3, 5 or even 10 percent,” he said, adding that he would have a list of items in question next week.
France’s annual inflation fell more-than-expected in May to 6%, its lowest level in a year, with modest gains in energy and food prices, but food prices continued to rise 14% last month after a record rise of about 16% in March.
French consumers will likely be pleased to hear that major food companies in the country have pledged to cut prices on hundreds of products from next month. Finance minister Bruno Le Maire has said that companies, including Unilever, have threatened monetary sanctions if they break their promise. The government has been concerned about the prices of goods in retail stores, which have reached a record level in recent months despite the decline in prices for many raw materials purchased by companies. Le Maire has previously warned companies that they could face special taxes if they fail to pass on the benefits of lower commodity prices to consumers.
The prices of products such as pasta, poultry, and vegetable oils will be reduced, and supervision and fines will be applied to those who do not follow the new rules. Companies that fail to deliver on their promise will be revealed to the public, according to Le Maire. Wholesale prices for a number of items are down, and retail prices should be down by 2%, 3%, 5%, or even 10%, he said.
France’s annual inflation fell more-than-expected in May to 6%, its lowest level in a year, with modest gains in energy and food prices. However, food prices continued to rise 14% last month after a record rise of about 16% in March. The government hopes that the new measures will help to ease the financial burden on French consumers.
