Not only they are selling smaller portions at higher prices, I think they are also changing the recipes of processed food.
My cat always ate a brand of cat food and lately the prices of that brand started oscillating wildly. One week you could buy the 3kg package, next week could be 50% more expensive and the week after that the price was back to normal. Coincidentally, my cat stopped eating that thing and I had to start feeding him another brand.
The explanation could be that they changed the recipe to cut costs to control the prices a little bit. Otherwise, I don't see how could they lower the price, given that all costs are going up. That could also be the case for food for human consumption.
Stay away from processed foods as much as you can.