The images of empty shelves are reminiscent of Venezuela, where citizens have to stand in line to buy essential commodities
The national shortage of baby formula brought inflation and the supply chain crisis back to the headlines this week, putting President Biden’s already beleaguered team further on the defensive. But while the White House promises it’s taking steps to address the problem, in reality there’s not much it can do.
The baby formula came about because of a two-pronged problem: consolidation in the US baby formula industry, and charges of unsafe conditions at one of the main production plants.
America’s baby formula supply is now in the hands of four major companies, which control 90 percent of the market: Abbott Laboratories, Mead Johnson, Gerber, and Perrigo Nutritionals. Since baby formula production is a highly complex process, the industry became very centralized — with the unfortunate result that a shutdown in one plant can have massive repercussions for the whole market.
That perfect storm came about in February, when two infants died and two others were hospitalized after consuming powdered Similac infant formula, produced by Abbott Laboratories. The Food and Drug Administration (FDA) started an investigation, and Abbott voluntary recalled many of its powdered milk infant formula products.
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