Are Conn. grocery stores ‘price gouging’? State opens probe

Connecticut Attorney General William Tong announced his office is seeking detailed cost and profit information from retail grocers in the state in an effort to determine whether their business practices are partly to blame for persistent high food prices.

The announcement Thursday came just a day after the U.S. Bureau of Labor Statistics reported another month of stubbornly high inflation — with prices rising 3.5% from the same period last year.

“Every single day, people in Connecticut, families are getting squeezed,” Tong said. “Our job, collectively, is to push back on that squeeze and to give Connecticut families just a little bit of breathing room.”

Tong said he was prompted to pursue the inquiry after a Federal Trade Commission report, released last month, found that major grocery chain profits “rose and remain elevated” in the wake of pandemic-induced disruptions to food supply chains — even after those disruptions appeared to have eased.

In 2021, revenues were more than 6% higher than costs among the food and beverage retailers FTC studied. And for the first three quarters of 2023, as inflation began to ease, those retailers’ profits reached 7%, the report found.

“This casts doubt on assertions that rising prices at the grocery store are simply moving in lockstep with retailers’ own rising costs,” the report reads. FTC recommended “further inquiry” by policymakers into grocery chains’ business practices.

Connecticut’s Democratic party leaders are heeding that call. The attorney general’s office will begin sending out letters of inquiry to grocery retailers in the coming days.

But food businesses in Connecticut said state officials should be careful how they assign the blame for higher prices.