PARIS/BRUSSELS (Reuters) — The European Union is investigating possible breaches of competition law during crisis talks held last summer in France that aimed to offer better prices for struggling livestock farmers.
“The (European) Commission has received complaints on the situation of the dairy and meat markets in France and is conducting an investigation,” a commission spokesperson said.
It has asked participants in the talks, which brought together farmer groups, food processors and supermarkets under the aegis of the farm ministry, to provide details of the meetings by mid-February, a French retailer said.
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“All players attending these meetings received these demands from the commission. All the French retailers received these demands,” said a spokesperson for the retailer.
The FNSEA, France’s largest farmer group, confirmed it had been contacted by the commission but said there had been no price fixing.
“We don’t have the impression at all of having breached competition rules,” FNSEA vice-president Henri Bichat said.
“There is a difference between indicating price levels that cover production costs and entering price agreements.”
A spokesperson for agriculture minister Stephane Le Foll said the farm ministry was aware of an inquiry being conducted by the commission’s competition directorate but that the ministry had not been contacted.
The investigation is a fresh setback for livestock farming in France, which has been hurt by a Russian embargo on western food and cheaper competition from other EU countries.
French farmers staged a series of protests last summer, prompting the government to hold sector-wide talks in which food processors and retailers agreed to try and improve prices paid to farmers.
However, food processors have balked at cutting their margins in the face of stiff international competition, with benchmark pork prices in France notably sliding to close to C$1.54 a kilogram compared to the $2.15 a kg that is seen as a break-even level for farmers.
The farmer protests and the support given by the government irked other EU countries, such as Germany and Spain, whose farmers are also grappling with low prices and oversupply.
In a sign of an enduring crisis in the livestock sector, Le Foll said 35,000 livestock farms were in serious trouble, up from an estimated 25,000 last summer, which already represented 10 percent of the total.
The government has pledged hundreds of millions of dollars in special aid for livestock farmers, notably through tax breaks and co-financing for investment projects.
