US targets surging grocery prices in latest probe
7:45 pm Thursday, August 01st, 2024
By Jody Godoy
(Reuters) – The U.S. Federal Trade Commission will probe why grocery prices remain high even as costs for retailers fall, Chair Lina Khan said on Thursday, a key theme for the Biden-Harris administration as it heads towards the presidential election.
Once the FTC votes to authorize the study, major grocery chains would be ordered to provide information on their costs and prices on common products. Khan made the announcement at a public meeting with Justice Department officials on pricing practices.
The biggest U.S. industry players include Walmart; club grocery chain Costco Wholesale Corp; Amazon.com, which operates Whole Foods; and big box retailer Target.
Food prices have risen 25% between 2019 and 2023, faster than other consumer goods and services, U.S. Department of Agriculture statistics showed. An FTC study showed food prices for U.S. consumers rose 11% between 2021 and 2022, while profits for food retailers went up more than 6%.
“We want to make sure that major businesses are not exploiting their power to inflate prices for American families at the grocery store,” Khan said.
The FTC has played a major role in the Biden administration’s efforts to cut costs for U.S. households, targeting high prices and junk fees on products and services ranging from airfare to credit cards.
Billionaire Democratic donors, some affiliated with businesses the FTC has sued, have urged Vice President Kamala Harris, the Democratic presidential nominee, to replace Khan if elected.
The agency last week launched an inquiry into services that could let companies set different prices based on the shopper’s personal information.
The FTC earlier this year sued to block Kroger’s acquisition of smaller grocery store rival Albertsons, citing concerns the deal would hike prices for millions of Americans.
(Reporting by Jody Godoy; Editing by Richard Chang)
