The overlooked factors that likely contributed to the baby formula crisis
Demographic Intelligence believes less breastfeeding, panic buying and the number of births itself all played a role in crisis
Much of the blame for the infant formula shortage has been placed on Abbott Nutrition, which had a voluntary recall and also temporarily shut down one of its U.S. plants while officials investigated why several infants got sick and two died, and whether formula was the cause.
But other trends have also contributed to the shortage, including supply chain problems that have impacted numerous products, not just formula. A new survey by Demographic Intelligence highlights three other under-reported issues that have driven volatility in the baby formula market and panicked some parents, according to Lyman Stone, chief information officer for Demographic Intelligence, which provides U.S. birth forecasts and fertility analytics for businesses that have an interest in birth trends.
The factors identified in the survey are:
- Panic buying and hoarding.
- Widely fluctuating number of births.
- A decrease in the number of women who breastfeed.
Although these issues each require unique solutions, officials say the formula crisis may soon be resolved — or at least lessened.
Monday, the Food and Drug Administration announced it had reached an agreement with Abbott that could allow the plant in Sturgis, Michigan, to start production again in about two weeks. The consent decree has to be approved — the Justice Department has already filed it in federal court — and requires Abbott to take certain steps, including hiring an independent expert to review the operations at the facility to make sure it complies with the law, the statement said.
In the meantime, as the Deseret News previously reported, the Biden administration is doing some streamlining to more easily allow the importation of formula from foreign countries. That includes rapid review by the FDA of applications that are likely to be successful. Quality control won’t be dropped, officials promised. And other major formula manufacturers are working to increase production and speed up distribution of their product to store shelves.
Congress is also trying to help. Rep. Chris Stewart and Sen. Mike Lee, both Republicans from Utah, are among the sponsors of the FORMULA Act, designed to bolster the supply chain.
The proposed legislation would waive trade barriers like tariffs and importation quotas that reduce supply and bump up prices. It would also make it easier to import high-quality formula from Europe during the shortage and allow those in the Women’s, Infants and Children program to use vouchers to buy formula from any producer, rather than being required to buy from a list of approved baby formulas.
In a news release, Stewart said that “new mothers are hunting from store to store to feed their infants. This is heartbreaking to see and it should never happen in America. Red tape led to the culmination of this crisis and removing it is our best way out.”
A crisis unfolds
Abbott Nutrition’s role in the current formula crisis begin in February when the company issued a voluntary recall and subsequently shuttered an infant formula plant in Sturgis, Michigan, after several babies got sick and two died. An FDA investigation found the cronobacter sakazakii bacteria in the plant. Abbott has emphasized the bacteria was not found in finished product, which it tested, but rather in the facility itself.
Demand for formula has surged online as store shelves have emptied. According to an analysis by Pattern, a global e-commerce accelerator, online demand for baby formula was up 1,348% last week compared to the week before, and up more than 3,000% compared to the average for the rest of the year so far. Pattern looked at online demand for six baby formula products; two in particular stood out.
Demand for Enfamil was up 282% compared to the previous week and up 531% compared to its 2022 average. Demand for Similac, one of Abbott Nutrition’s products, was up 226% last week — and up 429% from its 2022 average.
But shutting down one plant is not the whole story, experts including demographer Stone agree.
In early 2020, infant formula sales skyrocketed as families bought lots of it, worried that it would disappear the way toilet paper had in the pandemic’s early days. Those parents started using some of their supply later in the year, which meant formula sales were weaker, Stone said. “This introduced one major source of volatility which has not fully gone away: increased prevalence of panic-buying, hoarding and irregular purchasing behavior by parents.”
He said that when one brand is in short supply, families do buy other brands, “but they are also more likely to buy in a panicked fashion, driving further shortages. Even where supply is technically sufficient to meet demand, panic-buying and household stockpiling can create the appearance of shortages.”
Also in 2020, birth rates crashed and the need for formula lessened, Stone said. By early 2021, “births came roaring back, leading to very high year-over-year growth rates.”
Meanwhile, fewer women have been breastfeeding their babies. Demographic Intelligence said it asked about breastfeeding in five waves of its family survey between April 2020 and April 2022. The survey suggests breastfeeding rates have fallen, especially among women with older infants. Breastfeeding duration also appeared to decrease during the pandemic.
While Stone said it isn’t clear why breastfeeding rates have fallen, the decline is most notable for older infants. He speculates that breastfeeding duration probably declined during the pandemic. Regardless of the cause, the decline fuels greater demand for infant formula, he said.
The change in breastfeeding rates has received little attention, “primarily because data on breastfeeding behavior is hard to come by,” said Stone. “Because (Demographic Intelligence’s) Family Survey asks about breastfeeding, we have been able to monitor shifts in infant feeding behaviors.”
Why breastfeeding matters
The American Academy of Pediatrics recommends “exclusive breastfeeding for about six months, followed by continued breastfeeding as complementary foods are introduced, with continuation of breastfeeding for one year or longer as mutually desired by mother and infant.”
The group’s policy statement notes benefits to breastfeeding, including lower risk of certain health issues like ear infections, asthma, respiratory infections, bowel and digestive issues, and atopic dermatitis, among others.
Still, it’s not as simple as saying “Just do it,” despite known benefits, including economic ones because breast milk is cheaper. Some women have trouble producing enough breastmilk. Stress, work schedules and other issues, including the woman’s health, may impede ability to breastfeed exclusively or, in some cases, at all.
As The New York TImes reported recently, “Medical and economic realities of new parenthood in America can make that one-year finish line an impossible goal for many mothers. By six months, the majority of new mothers give their babies some formula, for reasons ranging from problems with latching and milk supply to the demands of work outside the home.”
The article said some parents, desperate to make sure their babies are fed, have tried to craft their own formulas using powdered oatmeal cereal and fruit juice, “even though pediatricians say formula or breast milk is a crucial source of nutrition from birth to the first birthday.”
Stability in sight?
Once production in Sturgis restarts, it’s expected to take six to eight weeks to get product to stores. For now, the company is flying in additional formula from its plant in Ireland.
That step, along with increased production from other companies and other measures being promised by officials, creates hope the crisis will be a bad memory by summer’s end.
Although it agreed to make improvements in its Sturgis plant, a statement this week from Abbott Nutrition said, “After a thorough review of all available data, there is no evidence to link our formulas to these infant illnesses.” It noted that testing conducted for the Centers for Disease Control and Prevention did not link any of the illnesses to formula it produced.
“The infants consumed four different types of our formula made over the course of nearly a year and the illnesses took place over several months in three different states,” the statement said.