One of the largest infant formula producers in the U.S., Abbott Nutrition, recalled several major brands of formula in February 2022 due to bacterial infections. The recall involved brands such as Similac, Alimentum and EleCare. According to the FDA, Abbott's manufacturing plant in Sturgis, Michigan was shut down in connection with the investigation. This placed immense strain on the U.S. formula supply as Abbott controlled about 40% of the U.S. at the time. Parents reported searching store shelves in vain for the recalled formulas and suitable alternatives. The supply chain woes were compounded by on-going shortages related to pandemic-induced production and distribution issues. Analysts warned that it could take several weeks before formula supplies returned to normal levels across the country.
International Imports Increase To United States Infant Formula
With domestic production unable to keep pace with the surging demand, retailers and government agencies looked to international s to import more infant formula. In May 2022, 'Operation Fly Formula' was initiated by the Biden administration to speed up the import of formula from overseas on military aircraft. Over 2 million pounds of infant formula was airlifted to the U.S. from Europe, Australia and other important production hubs. Several major retailers also air shipped formula on commercial flights. The imported goods helped supplement dwindling inventories but critics argued that the emergency measures highlighted deep flaws in the U.S. system's heavy reliance on just a few domestic manufacturers.
Supply Levels Gradually Increase But Challenges Remain
By summer 2022, Abbott had restarted production at the Michigan plant with enhanced safety protocols after reaching a consent decree with the FDA. Combined with increased imports, this succeeded in boosting national formula supplies. Data showed that in-stock levels rose from 89% in July to over 94% by September 2022 across most states. However, full recovery continued to elude certain hard-hit regions and subsets facing specific formulation needs. Finding specialty formulas for allergies, nutritional deficiencies or prematurity also remained tough. Manufacturers struggled to boost overall output due to raw material shortages, rising costs, and labor constraints. Additionally, analysts forecasted a continuing dependence on imports going forward.
Regulatory Response And Enhanced Safety Measure
The Abbott recall spawned regulatory action and discussions around long term reforms to address weak points in the U.S. formula supply system. In September 2022, the FDA published revised standards to tighten formula plant inspections and ensure rigorous testing. It also issued guidance for on biofilm prevention and mitigation strategies during production. Looking ahead, policymakers mulled options like incentives for more domestic manufacturers, stockpiling of formula, streamlining import clearance processes and subsidies for specialty formulas. experts warned that full recovery would be a long road, predicting supply challenges and higher prices to continue well into 2023 and beyond before equilibrium is restored.
In while baby formula supplies in the U.S. have shown signs of improvement in recent months versus the acute shortages earlier in 2022, underlying structural issues remain. Full recovery continues to be elusive for all regions and customer groups. Ongoing effects of the Abbott recall, rising costs, international dependencies and regulatory changes mean both manufacturers and consumers will have to carefully manage risks. Policy reforms are also needed to build flexibility and resilience into the domestic infant formula system over the long term.
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