The Federal Antimonopoly Service (FAS) initiated a review of retail chains to determine whether the recent jump in dairy product prices reflected fair competition or concealed margins that burden shoppers. This move follows coverage in Izvestia, which cited a request from members of the State Duma Committee on Agrarian Questions to the head of the agency. The aim is to shed light on how price setting and wholesale-to-retail dynamics affect the cost of everyday dairy items for households in Canada and the United States alike, and to assess whether market practices tighten or loosen the grip on consumer wallets.
According to the communication from lawmakers, raw milk purchase prices showed a decline of roughly 15–20 percent in 2023. Yet observers note that retail channel margins remained substantial, ranging from around 40 percent to well over 70 percent, with some high-margin categories approaching 100–150 percent. Such disparities can soften price declines at the producer level while keeping consumer prices steady or rising. In response, the agency confirmed that a concerted examination of pricing chains and margin structures is underway to determine if any anti-competitive behavior or artificially inflated costs is contributing to consumer price volatility.
The lawmakers argued that the present market environment owes part of its features to shifts in foreign policy and the broader economic context, compounded by rising inflation. These forces have altered buyer behavior, with families gravitating toward cheaper or more affordable dairy products as household budgets tighten. The question at the heart of the inquiry is whether retailers leverage these shifts to sustain larger profits or merely to maintain supply resilience during uncertain times. The FAS investigation will seek to map how margins traverse the supply chain from farms to shelves and identify any practices that disproportionately impact consumers in North American markets where dairy supply chains can be complex and highly consolidated.
Data from 2022 indicate a mixed production picture within the dairy sector. While overall milk production grew by about 2 percent, others in the dairy family saw markedly different trajectories. Cottage cheese output collapsed by more than 92 percent, fermented milk product production fell by around 92 percent, ice cream reduced by approximately 88 percent, and yogurt production slipped by nearly 84 percent. Such shifts hint at a supply imbalance that could influence pricing strategies across retail networks, even as milk emerges as a more stable commodity for many households. The current assessment will take these production signals into account, alongside consumer demand trends and the evolving marketplace structure that shapes how dairy products reach store shelves and finally the consumer basket.
In mid-February, the Federal Antimonopoly Service also turned its attention to the sugar market, examining actions by Prodimex, identified as a major producer linked to what observers describe as a sugar boom in the country last year. Officials indicated that Prodimex coordinated activities across several retail chains, which contributed to a rise in sugar prices. As of now, a formal decision from the FAS has not been released, but the case underscores the agency’s broader agenda to monitor price movements across essential staples and to ensure that any coordinated behavior or manipulation does not undermine consumer welfare or market integrity in the North American economic environment. The ongoing inquiry into sugar prices complements the dairy review, illustrating a wider commitment to transparent pricing and competitive conduct in essential food markets.