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Food and beverage to France

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(Last updated: 30 Oct 2008)

Trends and opportunities

The market

The French food industry ranks among the world leaders in terms of innovation, technology, research and development and quality. French consumers are health conscious and are becoming more demanding in terms of quality standards and traceability of products. Australia’s image of a clean and green environment is particularly favourable in this context.


French consumers are ready to pay premium prices for high quality products. Organic supermarkets have taken advantage of this situation and there are good prospects for innovative dietetic, health and organic foods in France. In 2007, the production of organic food increased by 17 per cent.

Mergers and alliances between the leading hypermarkets and supermarkets have formed the country’s seven largest retailers with five central buying offices. The trend towards consolidation is growing.

The main mass grocery retailers (MGAs) include Monoprix, Franprix, Casino, Leclerc, Aldi, Carrefour and Lidl.


In 2007, France produced a total volume amount in tonnes in the following industries: 

  • Fresh food – 19.4 million
  • Meat – 4.9 million
  • Vegetables – 2.9 million
  • Fruit – 5.3 million
  • Nuts – 0.52 million

The agri-food sector is the largest industrial sector in France. There are more than 418,000 people who are employed by 4,250 food companies, which makes the food sector the third largest industrial employer in France. France ranks among the leading exporters of processed food products worldwide with total exports valued at €33 billion (2007).


In terms of food products exported to France:

  • Seafood products represent 12.5% of all products
  • Meat and meat by-products – 11.9%
  • Dairy products – 10.9%
  • Oils – 7.8%
  • Vegetable and fruit preparations – 7.4%

In France, the agriculture and food production sectors are:

  • Fish – 2%     
  • Chocolate and confectionary – 4.3%
  • Mineral water and soft drinks – 4.7%       
  • Fruit and vegetable processing – 4.9%
  • Alcoholic beverages – 9.7% 
  • Bread and baked goods – 12.5%
  • Dairy – 17.3%
  • Meat and poultry – 23.0%
  • Other – 21.6%

Meat

In France, the meat industry is very fragmented – the top three players account for less than 30 per cent of total sales. Seventy per cent of the meat within the market is sold to supermarkets and hypermarkets while 25 per cent is sold to butchers and five per cent is sold to discounters. The market in France can be divided into the following meats and quantities: 

  • Pork – 1.9 million tonnes
  • Poultry – 1.4 million tonnes
  • Beef and veal – 1.3 million tonnes
  • Lamb mutton and goat – 0.15 million tonnes
  • Other meats – 0.29 million tonnes

(Source: Euromonitor)

 

Quotas are a limiting factor for exports of meat such as beef and lamb to France. Australian exports of meat to France include small volumes of lamb and beef meat and a larger volume of game meat where quotas do not apply. The variety of game meats exported to France from Australia includes kangaroo, ostrich, venison and wild boar.

Fruit and vegetables

High quality products are also in demand – for example, in 2007-08, exports of almonds, macadamias and dried fruit exported to Europe was valued at $62 million (Source: Foodmag).


The volume of Australian mangoes exported to France has been increasing steadily for the past two years. There is a market for dried fruit such as sultanas and raisins, which are used in the bakery and pastry sector, as well as opportunities for off-season fruit and vegetables such as:

  • strawberries
  • peaches
  • cherries
  • nectarines
  • asparagus
  • onions

Seafood

France is the world’s fourth largest importer of seafood importing around AUD$6.5 billion in seafood. The main seafood species imported are prawns, salmon, tuna, scallops, lobsters, crabs, mussels, pollack, angler-fish and cod. Australian seafood distributed to France includes lobster, prawns, scallops, crabs, red emperor and yabbies. The breakdown of the seafood product sector is:

  • Fresh and live products – 62.5 per cent
  • Frozen products – 27 per cent
  • Smoked and dried products – 10.5 per cent

Processed food

In 2007, the processed food sector generated approximately AUD$105 billion in sale. The main drivers for the market were chilled processed food and baby food. The main surge in these sectors is due to the growing number of younger people looking for convenience and the highest birth rate in 30 years in France respectively.


Health concerns have also continued to play a role in this market – with media campaigns and new legislation bringing obesity to a forefront in France. This has led manufacturers to focus on healthier packaged food products.


Between 2002 and 2007, the following industries saw a signficant increase in sales in France:

  • Sweets and savoury snacks – 8.6%
  • Ready meals – 11.6%
  • Soups – 25.8%
  • Pastas – 6.4%
  • Processed frozen foods ­– 8.9%
  • Chilled processed food – 30.1%
  • Baby food – 21.7%

(Source: Business Monitor International: Processed foods)

Wine

Wine sales in France for 2007 represented approximately AUD$40 million. Total world sales decreased by two per cent, but sparkling wine and higher quality wine saw a rise in sales.


In 2006, France imported approximately 9.1 million litres of Australian wine; representing approximately two per cent in wine imports in France and an approximate value of AUD$17 million. Even in this highly competitive market, along with the declining economy, wine sales have showed a steady growth of around four per cent.

It is worthy to note that Australia is France’s third largest importer of new world wines, behind North and South America. It is worth noting that France exports in wine totalled AUD$7.2 billion.


(Source: Business Monitor International wine fact sheet - 2006) 

Opportunities

The main opportunities in the French food and beverage industry for Australian exporters are:

  • wine
  • seafood
  • meat
  • fruit and vegetables
  • processed food

Other areas of potential growth include the easy-to-prepare foods; such as pre-prepared dishes of meat, vegetables and fish. This area is seen as a growing sector in France as a result of the rising number of young, single parents and professionals who are looking for an easy alternative to traditional cooking.


Furthermore, an increase in sales for health and organic products is expected as a result of a worldwide trend in addition to health issues for French consumers.


(Source: Business Monitor International: Food)

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Marketing your products and services

Market entry

French retailers rarely buy direct from overseas companies. They usually prefer delegating the logistical aspects to their suppliers. Some recommended methods for selling to French retailers include:

  • Apointing a distributor who is already well established in the market
  • Sending one of your staff as the representative of your company in the market to look after all the logistics on the spot
  • Sharing distribution with another Australian company with a complementary product range

It is recommended that Australian exporters – particularly smaller companies and new exporters – work through importers or wholesalers rather than trying to work directly with supermarkets. Payment terms, listing fees, end of year discounts, price commitments and other restrictions otherwise make it difficult for a company with little cash flow.


Compared to many other countries Australia has an advantage because of the quality of its food products. Any issues raised by importers are generally about the way the products are handled and processed (packaging, logistics, transport, etc.). Other issues include the import duties that apply to some Australian products, which make them more expensive than those from other southern hemisphere countries.


Many French food key players still believe that Australian food companies are more interested in the Asian markets than European markets. The lack of long-term commitment from some Australian companies has led French importers to source products from other competing southern hemisphere countries. However some companies who have invested time and selected the right business partner in the market have achieved some excellent returns on investment.

Distribution channels

The French food retail system is comprised of six categories:

  • Hard-discounters (Leader Price, Franprix, Lidl)
  • Supermarkets
  • Hypermarkets
  • City centre stores
  • Department stores
  • Traditional outlets including ‘magasins de proximité’ or neighbourhood stores and specialised food stores (which account for 25 per cent of all distribution)

There are many different distribution channels in France depending on the products you export and whether these products are for the retail sector, the catering sector or the processing industry. The distribution channels also vary according to the type of products you export – whether they are fresh/live, frozen or ‘grocery’ products.


The mark-ups for Australian exporters are higher for the catering industry and the processing industry than in the retail sector.

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Links and industry contacts

Government, business and trade resources for France

Direction de la Concurrence, de la Consommation et de la Répression des Fraudes – www.finances.gouv.fr/DGCCRF
Fisheries and Aquaculture Department (seafood) – www.fao.org/fishery/statistics/en
French Agency for the Sanitary Security of Food Products – www.afssa.fr
French Customs – www.finances.gouv.fr/douanes/actu/rapport/bilangl2.pdf
Tradeport – www.tradeport.org

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Contact details

The Australian Trade Commission (Austrade) is the Australian Government’s trade and investment development agency, operating as a statutory agency within the Foreign Affairs and Trade portfolio.

Austrade assists Australian businesses contribute to national prosperity by succeeding in trade and investment, internationally, and promoting and supporting productive foreign investment into Australia.

Austrade:

  • Delivers services that assist Australian businesses initiate, sustain and grow trade and outward investment.
  • Promotes Australia as an inward investment destination and, with the States and Territories, supports the inflow of productive foreign direct investment.
  • Administers the Export Market Development Grants scheme.
  • Undertakes initiatives designed to improve community awareness of, and commitment to, international trade and investment.
  • Provides advice to the Australian Government on its trade and investment development activities.
  • Delivers consular, passport and other government services in designated overseas locations.

A list of Austrade offices (in alphabetical order of country) is available.

More information

For further information please contact Austrade on 13 28 78 or email info@austrade.gov.au

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Austrade makes no warranty, express or implied as to the fitness for a particular purpose, or assumes any legal liability for the accuracy or usefulness of any information contained in this document. Any consequential loss or damage suffered as a result of reliance on this information is the sole responsibility of the user.