Seven years after the speech given on October 11, 2017 in Rungis by President Macron on “the establishment of renovated contractualization”, none of the three versions of the Egalim law can keep its promise. It remains to be seen whether large retailers will agree to respect the spirit of these laws in the annual negotiation on the entry prices of food products into stores which will soon begin.
While cold and snow are forecast in France for this Thursday, November 21, the Rural Coordination is blocking the port of Bordeaux and the entry of certain commercial brands to demand remunerative prices. This Thursday, Minister of Agriculture Annie Genevard will visit a farm near Béthune in Pas-de-Calais. Invited last night on BFMTV, she was content with vague words like “I respect the unions and I ask for reason, I hear the dismay, agriculture is the tricolor flag, that’s what we must understand the rejection of the agreement with Mercosur.”
Regarding Mercosur, France Info broadcast a report this Thursday morning devoted to arson in Brazil. A farm worker explained that he was paid the equivalent of €600 per month to cause these arson attacks and that he had no choice if he wanted to feed his family. The report also showed the arrest of a rich sponsor of the fires. The latter would be up 40% over one year in the hope of seeing the free trade agreement with the Europe of 27 open up new outlets for meat, soya and cane sugar in Brazil.
In France, the National Bovine Federation (FNB) of the FNSEA has just published a press release concerning the contradictory attitude of the European Commission:
“In spring 2024, the Directorate General for Health of the European Commission conducted an audit to assess the implementation of controls in Brazil. The audit report highlights that “the current arrangements in place to ensure that cattle whose meat is destined for the European market have never been treated with estradiol 17B for zootechnical or therapeutic purposes are ineffective” and that this “calls into question the country’s continued presence on the list of states authorized to export cattle to Europe (…) Thus, the services of the European Commission therefore recognize that they do not have the capacity to control and certify respect for the only existing mirror measure on beef imports, a measure which, however, relates to the health of consumers! “.
The difficult application of the Egalim laws…
One of the objectives of the peasant demonstrations in November also consists of putting pressure on the downstream sectors so that the annual negotiations on the entry prices of food products into stores are negotiated in accordance with the spirit of the Egalim laws. These laws were to take into account changes in the production costs of foodstuffs sold by farmers to processors. The National Federation of Milk Producers (FNPL) dialogues and negotiates with processors, including Lactalis for private companies and SODIAAL for cooperatives. These two companies process 40% of the cow’s milk collected in France for the marketing of various dairy products sold by distributors. They therefore have the means to impose remunerative prices on distributors. But the FNPL has just published a press release indicating that only the Intermarché brand has voted in favor of the application of the Egalim law this fall.
while market prices obey quotations
Despite the passing of three Egalim laws since 2018, downstream negotiators seek to constantly circumvent the law. The average cost price of a liter of cow’s milk can be quite easily calculated by taking production costs into account. Dairies can therefore ensure this fair remuneration for producers and have it paid to marketers, namely distributors, via the store entry price.
When it comes to wheat, corn or pork, fair remuneration for farmers is even more difficult to obtain via the Egalim laws. The prices of these raw materials continue to depend on quotes on trading rooms. This is the case at the port of Rouen for wheat, at Creil for corn, at Plérin in Côtes-d’Armor for the kilo of pork carcass. The weekly setting of these prices continues to obey what is called “the law of supply and demand” at the global level. As a result, these prices can remain very low for many months. A tonne of wheat cost €214 on November 12, 2024 at the port of Rouen, which leaves around €190 for the producer. This price was €330 in November 2022, but it has been hanging around €200 since May 2023 because global carryover stocks have been abundant for two years.
The production of broiler poultry and eggs makes it quite easy to calculate the cost price of production by taking into account the price of cereal-based feed, that of energy and the depreciation of buildings. But manufacturers who transform meat and eggs into products ready to sell are importing ever more poultry meat from Brazil, Thailand and Ukraine, which reduces the volume of outlets for French breeders and therefore their remuneration.
It remains to be seen whether a fourth Egalim law that the government is talking about will change this situation. In the meantime, food sovereignty is declining in France while production conditions and the long transport of imported products are increasing the carbon footprint of our plates.
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