Parents are paying too much for baby formula, the competition watchdog has found after a six-month review into profiteering.
The Competition & Markets Authority (CMA) said on Friday it had “significant concerns” that parents are not getting the best value for money as they face “historically high” prices.
It comes after the CMA launched an investigation into the baby formula market in February as it sought to address why prices had risen by 25pc in just two years.
The watchdog said: “Based on the evidence we have reviewed to date, we are concerned that many parents and carers are paying more than they need to for infant formula.”
As part of its findings, the CMA said “price competition appears to be weak”.
Producers have blamed this on tight regulation, as strict rules around advertising and discounting baby formula are in place out of fear of discouraging breastfeeding.
The CMA said: “We have heard concerns that manufacturers are able to raise brand awareness and influence infant formula brand choices.”
It added that it would examine whether the products were being “indirectly” marketed and how statements on packs might be influencing parents’ choices.
Friday’s announcement also warned that parents and carers were not being given enough information to make well-informed buying decisions.
All of which increases the chance of a regulatory clampdown, as the CMA will now provide recommendations on how the Government could improve the market.
The CMA started examining the baby formula market earlier this year after a wider profiteering probe into the consumer market singled it out as an area of concern.
Charities have warned that the soaring price of formula combined with wider cost of living pressures have pushed some parents to resort to theft in order to keep their children fed.
Meanwhile, reports have suggested that some mothers have started to water down formula because they could not afford to buy it.
These issues have led to greater calls for action by campaign groups and senior business leaders.
Richard Walker, executive chair of Iceland, previously said that new parents were being “exploited” by big suppliers.
The CMA said it will not launch an in-depth market investigation into the sector but did not rule one out in the future.
It said it made this decision because it wanted to “get as quickly as possible to the point where we have fully diagnosed any problems in the market and so can offer workable options for governments to consider to address these”.