Agreement will re-open negotiations when animal feed prices beat previous year three months in a row
A voluntary agreement, brokered by France’s minister of agriculture, will offer protection against market volatility by committing livestock producers to re-opening negotiations on animal feed payments each time feed prices rise, in three successive months, to more than 10% above the level of the same month in the previous year.
According to officials, the agreement should ensure that French livestock producers receive more for their poultry and other animals. It has been signed by representatives of 10 farmers’ groups, associations representing French processors and retailers and two independent national store chains.
In France, price negotiations between retailers and their suppliers generally occur only once a year, during February and March. The most recent round of negotiations was especially tough for the livestock sector. While the suppliers of some food products succeeded in winning price gains of up to 20%, especially if they use commodities such as coffee or cocoa, meat producers were much less successful. On the poultry side, for example, the annual increase obtained was no more than 3.5%.
The application of the new voluntary agreement is due to start in July, coinciding with the next contracts between grain producers, feed manufacturers and farmers. Its terms also require the signatories to take part in a revision of negotiating procedures, which will begin with poultry meat, beef and sheep meat as their food chains are thought to be simpler than the pork chain.