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Amazon sees opening in baby formula industry shake-up

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Amazon is deploying its lobbying power on America’s baby formula crisis, seeing an opportunity to extend its reach into a $2 billion-a-year market.

Between April and June, the company’s senior officials and in-house lobbyists held discussions about infant formula with lawmakers on Capitol Hill and officials from the federal government — the first time it’s reported doing so, according to its most recent federal lobbying report. Amazon lobbyists also discussed online purchasing restrictions for federal nutrition benefits — which are used to buy at least half of the country’s formula and billions of dollars worth of other groceries — with officials across the White House, FDA and other parts of the federal government, people familiar with those conversations say. Monument Advocacy, an outside firm representing Amazon, reported lobbying policymakers in the House, Senate and USDA on federal nutrition programs, as well.

Amazon’s foray into formula lobbying shows how the e-commerce giant stands to benefit from the industry shake-up that the ongoing formula shortages have triggered, particularly the potential to draw a larger share of the billions in federal dollars that go to programs designed to help close to 50 million lower-income Americans. That could allow Amazon to compete more directly with Walmart.com, its biggest e-commerce rival. The two companies have spent years jockeying for more access to the federal nutrition programs, especially since Amazon acquired grocery store chain Whole Foods in 2017.

“Formula is the perfect product for Amazon,” said Austin Frerick, deputy director of the Thurmond Arnold Project at Yale University, an antitrust law program. Among other things, he noted that it’s non-perishable and valuable for attracting return customers — something the company, which currently controls just over 2 percent of the U.S. grocery market, could use. “I think they want a bigger food play and more of your food dollar,” Frerick added. “Because that’s what Walmart has. You can buy your DVDs, books and TVs on Amazon but on your deodorant, you’ll go to Walmart.”


Amazon, however, must confront deepening distrust in Washington, where there is widespread concern about its alleged anti-competitive behaviors, and among food safety experts, who cite the challenges of policing third-party vendors on its platform.

“Historically, Amazon has been........

© Politico


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