“The war will continue, (…) all the crises behind it will have lasting consequences (…),” Emmanuel Macron said two days after the start of the Russian invasion of Ukraine. 45 days later, inflation is clearly confirmed in France. According to preliminary estimates by INSEE, prices in France rose by 4.5% in March after rising by 3.6% in February. “In the first three months of 2022, food stalls increased more than in the previous five years,” notes the association of 60 million consumers.
Which products are the most affected?
According to a NielsenQ study, inflation affects 68% of food categories. Thus, almost all products are affected. According to 60 million consumers, the products that increased the most in prices between March 2021 and March 2022 were pasta (+12.3%), frozen meat (+4.2%), vegetable oils ( +3.9%), coffee (+3.5%). %) and canned vegetables (+3.4%).
What are the causes of inflation?
According to E. Leclerc brand boss Michel-Édouard Leclerc, interviewed by BFM Politique, inflation is linked not only to the war in Ukraine, but above all to “the cause of past events.”
There are many reasons for the rise in prices. Growth in energy, transport and packaging, fueled in part by the war in Ukraine, is hitting manufacturers hard. Poor harvests due to weather conditions also affected prices. The epizootic of bird flu has also affected poultry farms. In addition, the cost of paper pulp is higher than the cost of toilet paper.
Will it get better?
Due to the war in Ukraine, price increases are likely to continue in the coming months. “The war in Ukraine should lead to a further rise in prices for meat, butter or flour among other things,” the association of 60 million consumers predicts. A view shared by Michel-Édouard Leclerc: While inflation in France reached 4.5% yearly in March, according to INSEE, “I think we will be at 6% at the beginning of the summer, and in this, I I think there will be a fairly significant increase in poultry prices and meat prices,” he explains.
Should we be afraid of scarcity?
Michel-Edouard Leclerc “does not foresee a significant shortage”. However, in some departments the oil is already gone. According to brand boss Leclerc, this shortage is due to “consumer behavior”. “We are starting to see consumers buying too much in some stores. They forgot a little about what happened at the beginning of Covid, during the first detention, and it was they who caused some departments to be left unfilled,” he explains to BFM TV.
What is inflation in neighboring countries?
France is doing well compared to its European neighbors. According to Eurostat, in March, the inflation rate in the euro area was 7.5% per year. The highest inflation rates for the year were in Lithuania (+15.6%), Estonia (+14.8%) and the Netherlands (+11.9%). Among our neighbors in Spain, the inflation rate is 9.8%, and in Germany +7.6%. In Italy, inflation was 7%, and in Portugal – 5.5%. France is, according to Eurostat, at 5.1%. This is beneficial for France “in terms of purchasing power and competitiveness,” Francois Villeroy de Gallo, governor of the Bank of France, told AFP.