Bakeries are central to the French way of life. Now they're fighting for survival

Photos by Nicolas Liponne/Hans Lucas/Redux, CNN

Elodie Chavret places bread on shelves before her bakery opens in the early morning. She has been managing L'Epi de Ble since 18 years, but is struggling to pay the increasing cost of electricity.

Elodie Chavret, who lives in Millery, a tiny town in the south-east of France, runs a baker to support herself and her daughters. Elodie Chavret, 39, is a part-time firefighters but says that this work is not what scares her.

Her fear? Her fear?

Chavret's contract renewal caused her bill to skyrocket from EUR900 ($978), in December, to EUR7500 ($8,146), in January. Her bill would be EUR4,500 ($4,888), per month, with a government subsidy. She said that this was still an 'unmanageable increase'.

Chavret, who told CNN that the new rate was 'unbearable', said it would obliterate all of her profits. She is already feeling the pinch from rising costs for raw materials and gasoline, as well as higher wages paid to her six employees.

Chavret’s Bakery in Millery is a small village near Lyon, in the southeast of France.

France's bakeries provide the vitality of many towns and villages.

The United Nations Educational Scientific and Cultural Organization (UNESCO) designated the French baguette in November as an 'intangible culture heritage' due to the knowledge and skills required to make it and the role it plays within French daily life.

But despite this, many bakeries struggle and are even on the verge of closing down, as the cost of energy and ingredients has risen.

Nicolas Amate and his wife Nad ege own a bakery in the east of France.

He told CNN that if the situation continued, he would close all of his businesses.

Price shocks

Official data shows that the industrial producer prices in France -- which are the prices charged by suppliers of goods and services produced in France to businesses -- soared 13% in February compared with January.

According to S&P Global's PMI surveys, input prices for French manufacturing (which includes bakeries) have also risen, even though inflation has slowed down since April of last year when it reached an 11-year peak.

Amate purchased butter two years ago for EUR6 ($6.52) per kilo. It costs EUR12 ($13). The price of flour has increased three-fold in a year. The price of eggs, milk, and cream has also increased.

The inflation of energy prices has been particularly painful to many businesses because of the rapid cost increase when electricity contracts renew.

Nicolas and his employee prepare chocolate croissants.

Nadege displays pastries in the bakery display case.

Last year, the Russian invasion of Ukraine caused European gas prices to reach record levels. Then, power prices followed.

The French energy prices have also been pushed higher by the shutdown of almost half of France's nuclear power plants for maintenance in 2022, which will cut off up to 70% the country's supply of electricity.

According to data from European Energy Exchange, French electricity prices have dropped from their record highs reached in August, but they are still almost three times higher than the average levels before the invasion of March.

Businesses that were forced to renew or sign new energy contracts at the end of last year are irritated by the December surge in electricity prices, which reached EUR465 ($505) a megawatt-hour.

Bakers can receive government support, but some say that the measures are not enough.

On January 1, a'shock-absorbing' payment was introduced to cover up 20% of annual electricity costs for a bakery that employs between 10 to 250 people.

Bakeries employing fewer than ten staff members can take advantage of a "tariff shield" that limits their annual electricity bill increase to 15%. These smaller businesses can also benefit from a cap of EUR280 ($304), on average, per megawatt-hour.

Thierry Maillard and his wife Catherine own a bakery in the northwest of Paris. They point out that a reduction of 20% from the'shock-absorber' wouldn't have been sufficient to cover a 500% rise in their electricity costs.

La Maillardise has a poster that shows the bread price. Thierry Maillard, the owner of La Maillardise, has increased the price of baguettes two times in the last year.

Thierry Maillard in front of his Bakery

Maillard has been trying to negotiate with a new supplier. However, he expects that his electricity bills will almost double.

Frederic Roy is a Nice-based baker who has taken more radical action. He co-founded in October a Facebook group of bakers, which has 2,100 members. In January, they staged their very first protest on the streets of Paris, calling for an increase in the 20% subsidy and the expansion of the "tariff shield" to include more bakeries.

Dominique Anract is the president of the National Confederation of French Bakeries. This organization represents 33,000 artisanal bakery shops in France.

Anract stated that if [bakers] follow our advice on energy moderation and if they increase their prices while using the [government] assistance, then bakeries will not be threatened.

Bakers tell CNN that raising prices is not as easy as it sounds.

She sold baguettes last year for EUR1.05 ($1.14) each. She now charges EUR1.20 ($1.30), a 14% increase.

To make any money, she would need to raise the price of many of her items. A classic baguette's price would have to be roughly tripled.

Chavret stated, "Let me tell that French people aren't ready to pay EUR3 per baguette."

Maillard, a fellow baker, makes the same point. In the last year, he has increased the price of baguettes from EUR1.10 ($1.19) up to EUR1.30 (USD1.41).

Thierry compares the energy costs he paid last year to a list of prices he was sent for January. The energy bills of bakeries can differ greatly depending on when they were contracted.

La Maillardise takes hot croissants out of the oven. Bills are expected to more than double for the bakery when they switch to a new provider.

He said that the price increases have only covered the increased costs of raw materials, such as eggs and butter. Further price hikes are not possible because customers will protest.

Chavret's staff and she are always switching off the lights and the heating, unless it is bitterly cold. However, the bakery bills are the highest ever.

"Very critical Situation"

In the last few months, a large number of French bakers joined online campaigns that call for increased government support. One such group was co-founded in Nice by Roy. Some have also taken part in protests on the streets.

He told CNN that the'very critical situation' of energy costs was what prompted him to take action.

I've worked in this business for 35+ years. This is the first time I've ever experienced a similar situation. Roy replied, "I have never shown in my life."

He added that'many of my colleagues have had to layoff staff because they cannot pay for everything', and noted that some bakeries "have closed permanently."

The survival of their business is at risk.

The bakeries of France are vital to the towns and villages of France, as they serve as public places where neighbors can meet regularly. Chavret says that the chitchat that is often part of it helps to keep people in touch.

She said: 'If bakeries close, we will lose the human aspect, communication and mutual help'. It's not at department stores where people talk.

Maillard gives a more stern warning.

He said: 'In a town or neighborhood, if a bakery closes, all the businesses in the area will also disappear... It would be the end of certain villages and districts.

The bakery is the heart of the community, the village.

Credits

Marie Barbier (left), Will Lanzoni, and Brett Roegiers.

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