French poultry leader seeks more double-digit price rises on costs
23/11/2022 16:40
PARIS, Nov 23 (Reuters) - LDC LOUP.PA , France's
largest poultry group, will need to raise its prices by around
10% next year to cover energy and other costs after already
increasing prices by a third since last year, the company said
on Wednesday.
Food prices in France rose 12% year-on-year in October,
making food a main contributor, along with energy, towards
record overall inflation in the euro zone's second-largest
economy.
LDC has secured price increases totalling 35% from
supermarkets over the past 18 months, which should cover
additional costs led by a jump in prices of cereals used in
poultry feed, Chief Executive Philippe Gelin told reporters
during a first-half results presentation.
The price rises supported a 14% increase in group sales,
even as volumes declined due to a bird flu crisis in France, and
helped keep LDC's operating margin steady, the group said.
With grain markets easing back, LDC was focused on absorbing
a jump in energy costs after negotiating electricity prices for
2023 that were more than three times those paid this year, Gelin
said.
Including the impact of energy costs on farmer suppliers
plus other inflation factors like packaging, LDC was expecting
to face an extra burden of 260 million euros ($269.46 million),
which could be met by an increase of some 10% in its poultry
prices, he said.
Poultry remained the cheapest meat category in French
stores, as other livestock sectors had also seen sharp
inflation, but LDC has reacted to inflation pressures on
households by launching a budget range in September, he said.
This year's bird flu crisis was not expected to disrupt
LDC's poultry offering for year-end holidays, after it shifted
production away from worst-affected zones in France and as a new
wave of outbreaks was more limited, Gelin added.
Foie gras producers, particularly hard hit by losses to duck
flocks during the disease epidemic, have warned that the pate
speciality will be rarer and more expensive this year.
($1 = 0.9649 euros)
(Reporting by Gus Trompiz
Editing by Bernadette Baum)
((gus.trompiz@thomsonreuters.com; +33 1 49 49 52 18; Reuters
Messaging: gus.trompiz.thomsonreuters.com@reuters.net))