The Food Foundation and CMA call for UK market improvements to make first infant formula more affordable

The UK Food Foundation and Competition and Markets Authority (CMA) both released reports warning of the high prices of infant formula in the UK. The CMA states prices rose by 18–36% from December 2021 to 2023. The Food Foundation highlights that the most expensive product on the market is twice as expensive as the cheapest formula despite being nutritionally comparable. 

Both reports emphasize that all infant formula products in the UK market are safe and suitable for supporting adequate growth and development, as they must comply with regulations on nutrition composition. However, the CMA cautions that there is a lack of timely, clear and impartial information about formula for parents and carers. 

The Food Foundation also highlights that 26% of mothers struggled to afford formula for their infants in January this year. Additionally, the CMA assesses that parents could save up to £300–500 (US$389–645) in their baby’s first year by switching to a cheaper brand. Price increases over the last two years varied per brand.

“This is a significant and unique market. We’re concerned that companies don’t compete strongly on price and many parents — who may be choosing infant formula in vulnerable circumstances and without clear information — opt for more expensive products, equating higher costs with better quality for their baby,” says Sarah Cardell, chief executive of the CMA.

Both organizations call on retailers, manufacturers and the government to make infant formula more affordable and improve the sector. The CMA is asking for feedback on its report from stakeholders, consumers and the infant formula industry by November 29. This will feed into its final report, expected in February 2025. 

Affordable products

The Food Foundation’s Kids Food Guarantee monitors the price of first infant formula at nine major UK retailers. This initiative represents a set of minimum actions the organization believes supermarkets should take to tackle rising food insecurity effectively. 

The initiative notes three first milk formula brands on the market in standard tins (800 g) that eligible parents can afford with the weekly Healthy Start government funding of £8.50 (US$11). 

These include two private label products from Aldi and Lidl, which the organization notes are “generally cheaper than branded goods despite being of comparable or identical quality.” 

The CMA says that infant formula prices rose by 18–36% (depending on the brand) from December 2021 to 2023.According to the Food Foundation, the UK retailer Iceland has reduced prices of infant formula products, which is the primary driver of supermarket price reductions. The retailer was the first to pass wholesale price reductions onto consumers. 

After the CMA’s critical report on market competition in November 2023, Danone and Nestlé lowered their prices, making Nestlé’s SMA Little Steps product one of the cheapest on the market. 

Although the foundation’s report identifies progress in driving down the cost of first infant milk, prices remain high. Moreover, price variation across retailers for individual products and brands is “concerning,” says the report. For example, Danone’s Aptamil product costs £11.20 (US$14.52) in Iceland stores but £14.00 (US$18.16) at Co-op, the highest recorded product price of all retailers and first infant milk formulas. 

Anna Taylor, executive director at the Food Foundation, comments: “The first year of a baby’s life is a hugely important time for laying down strong foundations for their future health. It’s a time of rapid growth and development, so it’s incredibly concerning that families face such a lottery when accessing and affording first infant formula.”

“First, infant formula is absolutely essential for those families dependent on it, yet we know that one in four mothers struggles to afford it. This is too important to be left to the market. We need the government to step in and ensure first infant formula is affordable for those who need it.”

Advertising of first infant formula

The Food Foundation also finds that several retailers are marketing formula products for manufacturers on their webshops, which it says is against the WHO International Code of Marketing Breast Milk Substitutes. This code says that “manufacturers and distributors should not engage in any form of promotion related to breast milk substitutes.”

The Food Foundation records progress in driving down prices, but they remain high and vary across products and retailers.Earlier this year, Access to Nutrition Initiative released its 2024 Breast Milk Substitutes Index, finding none of the 18 companies fully aligned with WHO’s marketing code, with eight scoring a 0% compliance. The index also reported improvements in the scope and application of FrieslandCampina and Nestlé’s findings. 

The CMA is concerned about a seemingly “widespread non-compliance with, and underenforcement of, provisions within the regulations that require infant formula and follow-on formula to be clearly distinct from each other.” 

The authority explains that infant formula may be indirectly promoted via a “halo effect” from follow-on formula, which may be advertised, unlike infant formula. 

“We found that promotional and marketing spend on follow-on formula and growing-up milk appears to be high, particularly if its main purpose is to support sales of just these product categories. For two manufacturers, promotional and marketing spend amounted to 20–30% and 10–20% as a share of follow-on formula and growing-up milk revenues in the UK,” details the report.

Recommendations for change

The CMA notes significant barriers to entering the infant formula market, making it difficult to disrupt it. For example, the UK infant formula market is highly concentrated, with three firms accounting for over 90% of supply. 

At the same time, both organizations make several recommendations for change. For example, the Food Foundation urges that retailers and manufacturers ensure price reductions are passed on, promote the UK Healthy Start scheme to low-income customers and refrain from marketing first infant formula promotional materials. 

The organizations say that communication and information on the nutritional comparability of first infant formula to parents must be improved.“We have identified options for change, but now want to work closely with governments in all parts of the UK, as well as other stakeholders, as we develop our final recommendations,” says CMA’s Cardell. “Importantly, any changes must continue to support regulation that ensures all formula gives babies the nutrition they need to thrive — as well as supporting governments’ aims on breastfeeding.”

The CMA also calls for clear, accurate and impartial information on nutritional sufficiency at the point of sale and incentivizing competition on price. The authority also suggests considering price caps to bring prices down directly. 

Both organizations call on the government to strengthen the law on breast milk substitute marketing by clarifying, monitoring and enforcing existing regulations. The CMA suggests measures to diminish brands’ power in the market, such as requiring different branding for infant and follow-on formulas or implementing stricter thresholds for on-pack messages. 

The organizations note that communication and information on the nutritional comparability of first infant formula to parents must be improved. The CMA calls on providing parents with clear, accurate and impartial information in healthcare settings, such as giving them a wide range of options to choose from or using standardized formula packaging in hospitals.