The average food budget in France will rise in 2022, as it turned out?

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According to a recently published Allianz Trade study, in the context of high inflation, the French food budget could jump by 224 euros in 2022.

But the French would not be the worst off compared to the rest of the old continent: an average increase in the food budget within the European Union would be € 243, and the Germans would even pay another € 254 in 2022. ..

The difference, which can be explained, among other things, by the highly concentrated market structure in France, which gives distributors significant financial space and allows them to absorb part of the increase in purchasing costs in the domestic budget, declines Aurélien Duthoit at AFP. The synergies achieved by the groups at the level of their shopping centers also make it possible to define the impact of rising production costs on selling prices, he adds.

Inflation back in France

Estimates of the increase in the food budget in 2022 are based on the assumption that distributors will pass on to their sales prices a 75% increase in prices paid to producers in the agri-food sector. At present, however, less than half of this increase in producer prices has passed on to consumers.

Producers in the European agri-food sector have increased their prices by 14% since the beginning of 2021, while food distributors have increased their prices by only 6%, says Aurélien Duthoit.

Vital needs, growing budget

According to the credit insurance company, the pace at which sales prices will adjust to producer prices remains very uncertain due to the volatility of the current economic environment, marked in particular by the war between Russia and Ukraine.

The conflict against the two great agricultural powers already has very specific consequences for prices: producers charge 53% more for oils and fats than in 2021. Meanwhile, the price of flour for distributors jumped by 28% and pasta by 19%. .

According to the latest INSEE data, inflation rose by 4.8% in April and food prices by 3.8% in one year. And according to Allianz Trade, growth will not stop, because distributors who have emerged from a two-year pandemic that are very profitable in terms of both turnover and profit do not need to maintain sales volumes by reducing prices. In addition, sales pricing strategies are becoming more sophisticated due to the development of technology.

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Constantly changing prices

Distributor discounts therefore tend to be much more selective than in the past, as they are tailored to every business and even every consumer. For some, rising food prices will only weigh on their ability to save for others, they could further jeopardize their ability to meet basic needs, concludes Allianz Trade.

The budget warning was triggered while the government is preparing an amending budget at the end of June, which should lead in particular to the distribution of food control.





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