January 6, 2022: Energy suppliers in France agree to allow bakeries to negotiate the recent payment plans for 2023 to avoid going out of business.
It comes between warnings that the country’s iconic boulangeries face an existential threat because of the double reach of higher wheat and energy prices, with announcements of a few already closing the shop.
On Tuesday, French Finance Minister Bruno Le Maire said that all energy suppliers had committed to “dissolve contracts when prices have increased prohibitively high and unsustainable for a few bakeries,” according to a Reuters translation.
He added that contracts will be examined on a case-by-case basis depending on the owner’s situation and that financial assistance may be offered.
On Tuesday, the government also announced plans to support the industry, which allows bakers to outstretch tax payments and suggested that further cash helping for energy bills may follow.
In December, the French baguette was stated to UNESCO’s Intangible Cultural Heritage list, which cements its status in daily life. Many firms facing collapse are small to medium-sized companies serving rural communities.
Local bakers and grocery chains have to support the costs of the staple steady as French inflation has zoomed to record highs.
Data is being by Eurostat in September showed French bread prices were increasing at a lower rate in the European Union, increasing 8% every year versus 18% on average.
While complete French inflation slowed just in December to 6.7%, food price inflation stayed at 12.1% for a second consecutive month. Market prices for crops and energy control cooled somewhat but remain subject to extreme volatility because of the ongoing war in Ukraine.
The government intervention is coming as President Emmanuel Macron prepares to stay controversial transfers to the French pension system that could lead to public strikes.