UK regulator to scrutinise baby formula market

Britain’s antitrust regulator said it would scrutinise the country’s infant formula market after prices soared by 25% over the last two years.

The rising cost of baby milk formula has been in the spotlight during Britain’s inflation-driven cost of living crisis, with media reports saying that some struggling parents have watered it down to feed their children.

Nestle NESN.S and Danone DANO.PA are amongst the companies which supply baby formula in Britain through brands such as SMA Nutrition and Cow & Gate.

The Competition and Markets Authority said it would launch a market study, meaning it has the power to force suppliers to provide information on pricing and other issues, instead of relying on voluntary submissions.

The regulator said it would aim to publish its final report in September 2024, adding that it would consider whether there are problems in the baby formula market and if so what actions should be taken to address these.

CMA Chief Executive Sarah Cardell said that the cost of infant milk remained at “historically high levels” even after prices fell over the last three months.

“We’re concerned that parents don’t always have the right information to make informed choices and that suppliers may not have strong incentives to offer infant formula at competitive prices,” she said in a statement on Tuesday.

(Reuters)