The Competition and Markets Authority (CMA) has warned that UK consumers are paying “over the odds” for baby formula.

According to the competition watchdog’s interim report on the market, it found that prices rose by between 18% and 36% over the years between December 2021 and December 2023.

As a result, the CMA has proposed measures to boost competition in the sector, including allowing companies to promote price reductions, reinforcing existing regulation and improving education for parents, Financial Times reported.

CMA chief executive Sarah Cardell said: “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.”

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The regulator found that it had become harder for parents to differentiate between products on offer due to alternative marketing, which came into play due to advertising rules, which ban promotions for baby formula such as discounts, in a bid to not discourage breastfeeding.

It said that companies using similar packaging branding to build brand loyalty, also known as cross-marketing, was extensive.

The CMA also discovered that generally cheaper supermarket own-label baby formula made up less than 5% of the market, while Danone, Nestlé and Kendal Nutricare comprise more than 90% of the UK’s baby formula supply.

A Danone UK and Ireland spokesperson told the Financial Times: “In Danone’s experience the UK formula milks market is competitive and dynamic, and we will continue to work constructively on ways we can carry on delivering value to parents.”

A Nestlé spokesperson added “Our efforts are focused on supporting families on their infant feeding choices and contributing to the best possible nutrition for their children’s healthy growth and development.” It added those included “providing products that are affordable and accessible to consumers, while ensuring fair prices for our suppliers and farmers”.

Cardell said that the CMA will “now be consulting on our provisional findings and the options we’ve put forward to get important insight from government and stakeholders – all of which will feed into our final recommendations early next year”.