Question to the Department for Environment, Food and Rural Affairs:

To ask the Secretary of State for Environment, Food and Rural Affairs, what assessment she has made of the impact of market concentration in the food retail industry on (a) consumers and (b) suppliers.

The Competition and Markets Authority (CMA) provided an updated assessment of retail competition and profitability in July 2024 which did not find that groceries inflation was being driven at an aggregate level by weak competition between retailers. There was overall growth in revenues, profits, and margins for retailers in the 2023/24 financial year. However, operating profits and margins remained broadly at or below financial years 2019/20 to 2021/22 level.

The CMA’s November 2024 analysis of supermarket loyalty pricing also found limited evidence of price changes which could indicate that supermarkets may have inflated prices to make their loyalty prices appear misleadingly attractive.

Supermarkets relations with suppliers are guided by the Groceries Supply Code of Practice. This imposes various obligations on the largest retailers such as dealing fairly and lawfully with suppliers, not varying supply agreements retrospectively, and providing reasonable notice of any significant changes to supply chain procedures.