French finance minister Bruno Le Maire has announced that 75 food producers have pledged to lower prices by July as part of efforts to stabilise food prices and combat inflation.
- The producers have committed to indexing prices to falling wholesale costs and will submit lists to the ministry next week of products that they will discount on the shelf in the short term.
- Le Maire has threatened to “name and shame” companies that refuse to participate in measures to reduce food prices and to levy a one-time “windfall” tax on producers if prices do not start coming down.
- French food prices rose 14.1% in the year to May, overtaking energy as the region’s biggest driver of inflation.
- Some officials and retailers believe food producers are taking advantage of the surge in inflation to boost their profit margins by raising prices more than needed to cover higher energy and commodity costs.
- While most economists are confident that the surge in food inflation has peaked, there is still uncertainty over how fast the surge in food prices will dissipate, and the impact of spiralling costs on consumers has been marked.