ACCC to examine Coles and Woolworths’ pricing of milk, coffee, chocolate in fight against price-gouging

The consumer watchdog will closely examine the retail margin of eight product categories — including milk, bread rolls and chocolate — as part of new anti-price gouging laws to keep Coles and Woolworths in check.

The first report under the legislation — which prohibits large retailers from charging prices deemed excessive when compared with the cost of supply, plus a reasonable margin — will be published early next year.

The new rules apply to retailers turning over more than $30 billion in revenue each year, currently only Coles and Woolworths.

Australia in July became the first country in the world to bring in such laws to protect cash-strapped shoppers from suspected price-gouging amid the cost-of-living crisis.

The Australian Competition and Consumer Commission on Friday announced its initial focus product groups, which also include potatoes, limes, bone-in chicken and coffee, along with kitchen sponges and scourers.

“It’s important to note that just because a product is on our focus list, it doesn’t mean that we currently consider supermarkets are obtaining unreasonable margins on these products. It signals that we think the pricing of the product warrants closer examination,” ACCC deputy chair Mick Keogh said.

“Our compliance monitoring is not limited to the announced focus products. We will continue to obtain and analyse margin and pricing information for all grocery products available at Coles and Woolworths, alongside reports from consumers and suppliers.

“This work matters to Australian consumers who are acutely aware of price increases in their supermarket shop.”

In selecting the focus products, the regulator said it used reports from consumers and suppliers — whether the product was considered essential or discretionary; and the prices of the products during the 2025 and 2026 financial years, as well as margins and sales.

The focus product groups represent more than 1000 items available across Coles and Woolworths. The ACCC said the initial focus would be on monitoring compliance with the new laws.

It comes as Coles faces a multimillion-dollar fine after it misled shoppers with sham discounts on 245 common household products, including soft drink, yoghurt, butter and dog food.

The Federal Court is also set to deliver its verdict on Woolworths in a similar case for its “prices dropped” campaign.

The ACCC’s final report into the supermarket sector last year found no evidence of price-gouging by Coles and Woolworths.