Quick Take — France: consumption at a standstill, consumers traumatised by inflation

“…And for good reason: with purchasing power still constrained by food spending 20% more expensive than in 2021 and prices that, despite the pause in recent months, continue to rise (0.6% in March, 1.2% in April, 1 .7% in May, according to INSEE), fears for employment due to the economic crisis and the multiplication of redundancy plans, the threat of budget cuts and tax increases, or an anxious geopolitical climate, the French are watching their spending very closely. And they prefer to save, for those who can, more than to consume. As a result, despite a slight improvement in wages, food consumption is struggling to recover. In the first quarter they even fell by 0.8% compared to the fourth quarter of 2024, according to INSEE, whose analysis is not limited to large retailers and includes restaurants. In March, they were even 3.2 per cent lower than in March 2024.”

Quick Take — Walmart will increase prices due to Donald Trump’s trade war

despite this week’s agreement between the US and China to reduce punitive tariffs… Walmart will try to keep food prices in check after years of food inflation, McMillon said. But he said there are new tariff pressures for products it has to import, such as bananas from Costa Rica and coffee from Colombia

McMillon’s warning on Thursday came as Walmart reported a 4.5 per cent annual increase in comparable sales in its eponymous US business in the three months to the end of April, surpassing the 3.7 per cent increase expected by Wall Street analysts, according to Visible Alpha… Mexico, Canada, Vietnam and India are Walmart’s main sources of imports, along with China…

Walmart reported that its e-commerce business – which includes sales from its own inventory and from third-party merchants using its platform – grew 22% year-on-year and was profitable both in the US and globally for the first time. Trade war jitters prompted shoppers to accelerate purchases of certain items in an effort to beat tariffs, potentially distorting the picture of consumer demand

Quick Take — Beef prices in the US continue to rise

As ranchers face the leanest herds in 70 years A years-long drought in the American West has dried up pastures and created a shortage of calves…

The average price of a pound of ground beef rose to $5.79 in US cities in March, up 12.8 per cent from last year and the highest on record, according to Labour Department data. The price of raw beef steaks also hit all-time highs, reaching $10.98 per kilo. A years-long drought in the American West has dried up pastures and US farmers have steadily reduced their herds, creating a shortage that has driven up the price of calves and, consequently, other beef products. Labour and insurance costs have also risen, and although cattle weights are higher than ever before, this is not enough to compensate for the collapse in cattle numbers… Inflation is low (2.3%) but is likely to rise soon with the tariffs.

Quick Take — FAO: Food price index on the rise

Global food commodity prices rose in April, driven by rising prices of cereals, meat and dairy products that outpaced declines in sugar and vegetable oils, the UN Food and Agriculture Organisation said today.

The FAO food price index, which tracks monthly changes in a basket of internationally traded food products, averaged 128.3 points in April, up 1 per cent from the March estimate of 127.1 points.

Note below the inflationary peak of 2022

Quick Take — Despite galloping inflation, high-end chocolate holds up well

“Customers have mostly remained loyal to the luxury chocolate manufacturers who have largely refused to reduce cocoa content and instead increased prices“…

… Consumer brands also held up well: Nestlé said the KitKat recipe had not changed, adding that the popularity of the chocolate bar demonstrated “the continued appeal of established brands offering tasty products.”

Below: a Swiss luxury brand

Quick Take — US: US buyers flock to Chinese apps for fear of duties

After the panic in supermarkets with consumers looking for items produced in Europe it is now the turn of Chinese non-food products to be found on e-commerce giants like Temu, Shein or Alibaba.

“Together with DHgate, known as ‘Dunhuang’ in Chinese and nicknamed ‘Little Yellow App’ by some shoppers, Alibaba Group Holding Ltd. Taobao and Shein were among the most downloaded shopping apps in the US App Store….

Last week, DHgate released an open letter to merchants on its ‘Tariff Escort Plan’, pledging to provide traffic, subsidies, logistics and other support to merchants to help them reduce cost pressure and stabilise sales. The platform claims to now host more than 2.6 million registered suppliers producing an average of more than 30 million products online per year. It covers around 200 countries and regions, has more than 10 warehouses abroad and provides over 100 logistics routes.

DHgate was founded in 2004 by Diane Wang Shutong, co-founder of joyo.com, one of China’s first e-commerce platforms that was later acquired by Amazon.com Inc. Nicknamed the ‘female Jack Ma’, Wang previously worked for Microsoft Corp. and Cisco Systems Inc. before founding her own company.

Of course everyone fears inflation and recession.