PEORIA, Ill. (WMBD) — A byproduct of the pandemic was a global supply chain disruption, making it hard for businesses and individuals to get just about anything shipped to them.
A byproduct of the Russian invasion of Ukraine and a very unstable global market led to historic inflation.
But why, of all things, did baby formula become a national crisis?
Ed Bond, the director of the Supply Chain Institute at Bradley University in Peoria, said the pandemic is a likely scapegoat.
“When we started the whole pandemic, in early 2020, people were hoarding toilet paper,” he said. “People were also gathering up baby formula, stocking up on that.”
This lowered the demand for formula as a result, making it “difficult for producers to do their planning.”
Another large contributing factor is the shutdown of one of Abbott’s plants. According to Bond, three companies make up 90% of all baby formula production in the country. Abbott is the leader of those three, making about 45-50% of all baby formula in the country.
The biggest buyer of baby formula in the U.S. is the government, through the Department of Human Services’ Women, Children, and Infants (WIC) food assistance program.
“There’s a big buyer, and there are three big suppliers. And much of that supply is done by contract, so it’s all prearranged,” Bond said.
When Abbot closed its doors in Michigan, Bond said, it pulled 20 products, which included formula designed for babies with special dietary needs. Bond noted how two children were hospitalized in Memphis because they did not get enough nutrition without their formula.
Why not expand baby formula production? For manufacturers, it simply is not a growing market.
“We’ve had declining birthrates,” Bond said. “Birth rates drive baby formula purchase. There’s no motive for another company to jump in.”
With no local manufacturers producing baby formula, the government turned to overseas markets.
Abbott imported products from its Ireland plant. Nestle has also ramped up production in Europe and exported products to the U.S.
Abbott is also planning to reopen its Michigan plant, with approval from the Food and Drug Administration. Also, an Ohio plant is shifting gears to produce Abbott’s Similac.
“The supply chain is responding,” Bond said. “The critical problem is probably with people with special needs of diet, who are within those 20 products which have been pulled.”
One question remains: What can the average family do to help?
Bond said to look for baby formula at smaller shops because they would be more likely to have it in stock than large supermarkets.
He also said to avoid hoarding, to prevent another shock to the supply chain.
“Rather than going to any extreme, the best thing to do is contact a pediatrician,” Bond said.
He also recommended the following websites as a resource for parents: the American Academy of Pediatrics (healthychildren.org) and this fact sheet from the Department of Health & Human Services.
Bond forecasted the problem to continue for roughly 10-16 weeks.
