France unveiled plans yesterday (30 March) to increase fines for food firms that do not publish annual results, part of government efforts to bring transparency to price talks blamed for hurting farmers.
The government has been struggling to deal with a downturn in meat and dairy markets that has prompted protests from livestock farmers in the past few months.
French farmers say low market prices for meat and dairy products, partly due to a Russian embargo on Western food and a falloff in Chinese dairy imports, are exacerbated by tough annual price negotiations between food processors and retailers.
The EU’s eastern member states could throw their weight behind France’s calls for a temporary suspension of the rules of the internal market to counteract the agricultural crisis. EurActiv France reports.
Agriculture Minister Stéphane Le Foll has singled out Bigard, France’s biggest beef processor and a major pork producer, and Europe’s largest dairy group Lactalis, for not releasing their results, which he says hampers efforts to determine margins along the food chain.
As part of a bill on financial transparency and corruption unveiled on Wednesday (30 March), the government proposed stiffer penalties for companies in the farm and food industries that fail to disclose results. These would be a fine of up to 2% of their daily sales in France for each day after the deadline for publishing the results.
French companies, including privately held family firms like Bigard and Lactalis, are required to file their results to a local business court within two months of their approval at a shareholder meeting.
An online court registry of French company filings showed that Bigard had declared group results up to its 2013 financial year, while Lactalis had not filed any group results since at least 2011.
The groups’ corporate websites showed total annual sales of €4.3 billion for Bigard and €17 billion for Lactalis, without specifying the year or giving other financial results.
Bigard and Lactalis both declined to comment on the matter.
Penalties already exist for non-disclosure of company results, but the farm ministry says these are not severe enough to have an impact on big companies.
Earlier this month, the European Union agreed to additional support measures for the bloc’s dairy and pork sectors following intense lobbying by France, the EU’s largest agricultural economy.
But analysts said that it could take time for farm-level prices to recover given oversupply in Europe and high dairy stocks in China, which had previously driven global dairy demand.
The European Union voiced support on Monday (14 March) for temporary cuts in milk production by farmers in member states in a bid to reverse the plunge in prices that has shaken the dairy industry.
A combination of factors, including changing dietary habits, slowing Chinese demand and a Russian embargo on Western products in response to sanctions over the Ukraine conflict, has pushed down prices for beef, pork and milk.
Overproduction of milk since EU quotas were abolished in April 2015 triggered a collapse in prices that have not recovered despite a €500 million aid package announced last year.
The details of the 'flexible aid package' were unveiled in September by EU Agriculture Commissioner Phil Hogan.
The European Commission announced the details of a “flexible” €500 million agriculture aid package on Tuesday (15 September), in an effort to tackle the food crisis EU farmers are facing.
- European Commission: Press release on exceptional measures for farmers in crisis (14 March 2016)