Members of Congress Press Biden to Flex Power on Food Prices
Elevated inflation, while off its 2022 peak, is proving to be a stubborn issue for grocers, CPGs and consumers – and a lightning rod for politicians. According to a report in TIME Magazine, several members of Congress sent a letter to President Joe Biden on May 13, imploring him to take executive action as their efforts to pass legislative action remain in limbo in the chambers.
In the letter, more than 40 signatories from the U.S. Senate and House of Representatives asked Biden to exert what they believe is his executive authority to pressure businesses in the food and beverage, grocery and agriculture industries. Among other suggestions for addressing what they deem price fixing, the lawmakers want Biden to ask the Federal Trade Commission (FTC) to act on a rule that limits or stops “exclusionary contracting” in the food industry, such as slotting fees and certain category management practices. The group also called for a joint task force to look into pricing across the food chain.
[RELATED: Prices Varied Considerably Across 10 Key Grocery Categories in Q1]
“Big food companies want to keep these huge profits and they're hiring plenty of lobbyists to keep Congress from acting,” said signatory Sen. Elizabeth Warren (D-Mass.) in an interview with TIME. “Congress has stalled out on doing work that it could do to help families lower costs… and the President has the tools to fight back.”
The FTC has already been busy on the regulatory front. In March, the agency released a report on pandemic-era disruptions, accusing some grocers of continuing to keep prices high to boost their bottom lines. The FTC has also come out against the merger between The Kroger Co. and Albertsons Cos., and is preparing for an August court date on the matter.
As of press time, neither the White House nor Republican members of Congress have responded to the legislators' letter.
Meanwhile, higher food prices are still on the radar of many consumers and companies in a pivotal election year. This week, the markets are awaiting the latest Consumer Price Index data on inflation, and last week, the University of Michigan released the results of its latest consumer survey showing that consumers’ expectations for inflation in the year ahead went up from 3.2% to 3.5% in the past month.
Additionally, consumer sentiment is down about 13% after three consecutive stable months, the survey found. “This 10 index-point decline is statistically significant and brings sentiment to its lowest reading in about six months. This month’s trend in sentiment is characterized by a broad consensus across consumers, with decreases across age, income and education groups,” University of Michigan researchers wrote.
