French dairy giant Danone is set to cut the wholesale price of its Aptamil infant-formula by 7% in the UK after the country’s competition watchdog launched a probe into high inflation in the category.

Three ranges of Aptamil will be reduced from £12 to £11.20 ($15.26 to $14.24) in UK retailer Iceland’s stores from next week. The products include the 800g variations of Aptamil First Infant Milk, Aptamil Growing Up Milk and Aptamil Follow-on Milk.

In November, the UK’s Competition and Market Authority (CMA) revealed that infant-formula manufacturers had raised prices by 25% over the past two years.

The CMA noted that 85% of the baby-formula market is dominated by two companies.

Danone said in a statement that it acknowledged the challenges faced by parents due to high prices.

It wrote: “During this difficult period, we have worked very hard to absorb the significant cost increases we have faced, make savings, and minimise any price increases.”

Danone’s 7% price cut applies to all its powdered Aptamil formulas sold to UK retailers but not liquid baby milks or any of its Cow & Gate products.

According to the CMA, baby-formula is vulnerable to higher-than-inflation price rises because parents are wary of brand-switching and only Aldi, the discount retailer, provides its own-label alternative.

Families could make savings of £500 in the first year of a baby's life on formula milk products by buying cheaper baby formula options, the CMA added.

Danone declined to add further comment on the price cuts.

An update on the CMA’s work into baby formula is due to be published in mid-2024.