Inflation on the shelves: "The whole economy is catching a cold," warns Grégory Caret

Inflation is back in our supermarkets. The causes include the soda tax introduced in March and the surge in cocoa and sugar prices. For Grégory Caret, director of the Consumer Observatory at UFC-Que Choisir, there will be collateral damage.

The price of your shopping basket continues to rise, as inflation returns. More than half of the major brand products tracked by Le Parisien, which lists 20 everyday food products, are affected by this increase. The basket now costs 2 euros more than in January (76.79 euros to 78.85 euros). The soda tax is causing the price of Coca-Cola to skyrocket, and the sweet grocery section is particularly targeted, according to UFC-Que Choisir , which also made its own observation. It sees this as a catch-up effect after trying to contain prices in 2024.

Those little snack pleasures, sweet groceries, sodas, cakes: if you have children, the problem becomes even more acute. A 1.75-liter bottle of Coca-Cola, for example, costs 19% more than at the beginning of the year. The price of drinks containing added sugars has almost doubled this year. LU Petit Beurre biscuits have increased by 15.13%, and Pasquier pain au lait by 4.32%.

According to Grégory Caret, director of the Consumer Observatory at UFC-Que Choisir, prices have stopped rising since mid-2023 but have still remained at extremely high levels. "Since 2022, they have increased by 20-25% depending on the brand. Over the same period, the minimum wage has increased by just over 10%."

"For households, rising wages don't allow them to afford the same basket of goods as three years ago. Inflation has never slowed down," the specialist explains.

Several phenomena explain these new price increases. First, there were trade negotiations between manufacturers and large retailers, as is the case every year. "So in April-May, there was an increase in a number of product prices," explains Grégory Caret.

But that's not all. There are "cyclical phenomena in certain markets," such as olive oil, which skyrocketed a few months ago, and now cocoa, whose price has increased fivefold in two years. As well as "legislative phenomena," such as the soda tax. According to the director: "We wanted to increase the tax on sugary products, so there could be a consequence."

Effective March 1, this soda tax aims to increase the prices of sugary drinks by 10% to encourage customers to consume less. Has it worked? "If you really want to make people consume less, you need unprecedented food inflation, like in 2022-2023, when households were unable to afford all of life's little pleasures. And it's particularly in the packaged beverage aisle that there have been significant declines in consumption," replies Grégory Caret.

"The price signal is something that works, like for cigarettes," he explains.

While the reasons for these various price increases are numerous, the French themselves are struggling to cope with the situation. Prices are rising, particularly for major brands. Arnaud, a father of two children who love sweets, clearly noticed this on his receipt: "We're definitely going to start buying discount products. If that accounts for 20-25% of my daily shopping, we're going to start thinking twice."

Even more drastic: cut out sodas and chocolate bars. This is what Nadia, also a mother, did: "Instead, we use syrups with water to make slightly sweet drinks for the children and give them a little treat. And for cakes, we try to make them homemade."

How can these increases be explained? Particularly by the soda tax, which came into effect on March 1st. But not only that, according to Valère Corréard, a specialist in purchasing power: "High-sugar drinks are increasingly taxed, so they pass the tax on to consumers."

"Despite everything, we are also in a situation where everything is increasing in this or that product category, so we will follow the movement, which will allow us to generate more margin," explains the journalist.

But consumers aren't the only ones suffering from this situation. "There are those who profit from it, in the mass retail sector, who have their own business strategy, but there are those who pay the price. And not just in the mass retail sector."

"In the clothing sector, for example, not a week goes by without news of company closures," analyzes Grégory Caret.

Indeed, consumers are being forced to tighten their belts due to inflation. And sociologically, we're attaching less importance to appearance with the rise of teleworking, he explains. "The leisure sector may suffer, as may restaurants; there will be collateral victims."

"The whole economy is catching a cold," he concludes.

INSEE figures show an acceleration in food prices over the year, up 1.3% in May, after a 0.1% increase in January. The cheapest retailers today remain Leclerc and Intermarché. Next come Super U and Auchan, followed by Hyper Carrefour and Carrefour Market, the most expensive.