FTC Releases Report on Grocery Supply Chain Disruptions

Summary

The Federal Trade Commission (FTC) has released a report on the causes of grocery supply chain disruptions during the COVID-19 pandemic. The report finds that larger market participants accelerated and distorted the negative effects of supply chain disruptions, which resulted in skyrocketing prices for groceries and product shortages for essentials. Small firms, especially smaller grocery retailers, were disproportionately impacted, facing difficulties obtaining products compared to larger firms. The report also found that dominant firms used the pandemic to increase their profits, and that some larger firms considered buying manufacturing suppliers, potentially threatening to make certain supply chains even more concentrated in the future. The FTC's report highlights key insights on market structure and business conduct among grocery retailers, wholesalers, and producers, as well as their effects on consumers. The findings are based on orders issued in 2021 to major grocery retailers and wholesalers, as well as publicly available data on industry costs and revenues.