A perspective of the food supply chain EP workshop on "relations along the food supply chain", 19 June 2012 Please edit the Master Layout to include information specific to the presentation. For slides for the DG/DeputyDG, delete [Unit]. Philippe CHAUVE Head of the Food Task Force DG Competition 19 June 2012 The views expressed in this presentation are personal and do not commit the European Commission

A few issues and ideas thereabout Prices Value-added in the chain Who is behaving badly? The farmers’ position Unfair trading practices Main sources: ECN report and Task Force’s own investigation

Agricultural commodity Price developments

Consumer Price developments

Consumer Price developments

What drives prices (source « ECN food report », monitoring and antitrust actions by Competition Authorities) Demand or supply characteristics and variations: e.g. Irish groceries, Italian fruit and vegetables, beer in UK and Latvia. => prices are not necessarily the result of anti-competitive behaviour Weakened competition: e.g. Bulgarian, Danish, Latvian and Lithuanian dairy processors Competition law infringements, about 50 cartels in 2004-2011: e.g. cartels of millers, bakers or pasta producers in the cereals chain, cartels of poultry producers and of egg producers .

Distribution of value added in the EU-25 food supply chain (1995-2005) 31% 29% 24% 33% 11% 13% 27% 28% 30% 1995 2000 2005 Food retail Food wholesale industry Agriculture 100%= 476 bio € 522 bio € 537 bio €

Consumption of processed and non-processed food

Consumption of processed and non-processed food

Price transmission : the Dutch NCA analysis on 2005-2008 Levels with the highest number of cases in the food sector: processing and retail

The enforcement record 2004-2011 Levels with the highest number of antitrust cases in the food sector: processing and retail

What about the farmers’ position? Unequal bargaining power is a fact identified by NCAs in many markets in the first level, sometimes further downstream: e.g. for milk producers /dairies in Bulgaria, France, Hungary and Romania, bakeries / retailers in Latvia Pro-competitive consolidation on the primary production level is the way forward =>A key element of the CAP reform

What about « unfair trading practices »? Many NCAs investigated them Few cases under national competition law, essentially about retailers in three member states most instances do not harm consumer welfare=> not a competition issue some NCAs question the impact on innovation and choice => Follow-up: self-regulation under the HLF, a Commission communication, investigations by competition authorities

Thank you!