While animal feed has already seen its prices increase by 13% in one year, the increases requested by manufacturers in the sector from distributors exceed 40% for next year.
A two-digit inflation tsunami, Michel-Edouard Leclerc persists and signs. The boss of the Leclerc centers expressed his concern in a tweet that went viral on Monday.
As on BFMTV two weeks ago, the distributor wants to take public opinion to witness the showdown between it and the consumer industries. According to him, the increases offered to him by Nestlé, Mars and other Unilever for 2023 are unacceptable.
After a year of inflation that saw food prices jump 11% in supermarkets, next year could be even worse.
+41% for 2023?
If there is an increase that challenges it is that of animal feed products. +41% required by manufacturers according to Leclerc after already an increase of 13% in 2022.
Why such an increase for kibbles for dogs and cats? First of all, you have to know that the so-called petfood market is very uncompetitive. Nearly 80% of the market is in the hands of the two giants, the Swiss Nestlé (Purina, Friskies, Fido…) and the American Mars (Whiskas, Royal Canin, Pedigree…). An activity that generates more than comfortable margins (20% on average) that these two groups are reluctant to compress.
Because at the same time the costs have risen sharply. +42% for poultry due to avian flu. Sharp rise in the price of cereals also used to make the starch of the croquettes. But also animal fat (+200% in two years) essential for coating kibble and which is becoming rarer due to the growing interest of oil companies who use it in biofuels. Added to this, the prices of energy and in particular gas to cook all these foods and we end up with a concentrate of all the inflationary tensions in the food sector.
14% are considering giving up their pet
Increases that hurt the purchasing power of pet owners. According to an IFOP survey, the average annual budget spent by French people on their animals has jumped 15% over the past two years to 943 euros. The food item alone increased by 201 euros compared to 2020 to 643 euros.
French people who are more and more numerous to own an animal. The number of domestic cats is up 6% since Covid. Animals that are often pampered and for which the owners spend increasing sums. The animal feed market amounted to 5.4 billion euros in 2021, up by more than one billion over five years.
But with inflation, the most modest households fear being forced to make trade-offs. According to the IFOP survey, two thirds of people earning less than 900 euros per month claim to have already changed their purchasing behavior, either by restricting themselves or by cutting certain expenses for their animal.
Nearly 20% say they have reduced the amount of food their pet eats and 14% would even consider parting with it.