Tesco cuts price of baby formula as supermarkets battle to offer best deals

06 March 2024 , 12:37

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Tesco has announced baby formula price cuts (Image: PA Archive/PA Images)

Tesco has announced that it is cutting the prices of baby formula, as competition between supermarkets heats up.

The store is reducing the price of 1.2kg tubs of Aptamil baby formula by £1 to £16 and 1.2kg boxes of Cow & Gate by 50p to £12. Tesco says this makes both types "cheaper per kg than any other major UK supermarket". Other price cuts include 800g tubs of SMA Little Steps infant formula from £9.75 to £7.95, and Cow & Gate 2 follow on milk 800g tubs falling from £10.50 to £9.65.

Tesco's chief commercial officer Ashwin Prasad said: "We're very focused on reducing the cost of the weekly shop for our customers, and we know that it can be particularly tough for those with young families who have all those additional expenses that come with welcoming a new baby."

He added: "That's why, today, we have cut the prices of baby milk formula across different pack sizes and brands to help those new parents who need to buy milk formula stretch their budgets a little further."

Last month, the Competition and Markets Authority (CMA) launched an investigation into the supply of baby formula milk after finding that prices had risen by 25% in the past two years. The CMA said it has begun a market study into formula supply following findings last November of an initial review into the sector.

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The Competition and Markets Authority (CMA) said last autumn that the baby formula market was really focused on just two companies, which make 85% of all the sales. This has meant that even when prices went up, not many parents changed what they were buying. The CMA found out that the cost of baby milk had gone up by a 25% in two years.

They also discovered out that parents could save more than £500 in their baby's first year if they picked less expensive baby milk. Even though some prices have dropped since November, the CMA says they are still "at historically high levels".

Now, they want to look more into how people decide what baby milk to buy, the rules around selling it, and why it's hard for other companies to start selling baby milk too. The CMA is planning to finish their big report in September.

If they find things that aren't right, they might suggest new rules about how baby milk is sold or give parents better info to help them pick the best milk for their babies. In January, Asda and Tesco decided to lower the price of Aptamil baby milk after the company that makes it, Danone, said they would make it 7% cheaper for shops.

Asda also made it easier for parents by letting them use their reward scheme vouchers to buy baby milk for the first time.

Lawrence Matheson