Baby Formula Has Become the Latest Supply Chain-Monopoly Battleground

by | May 11, 2022 | Politics & Corruption

Similac baby formula. Photo: Ajay Suresh, Wiki Commons

Baby Formula Has Become the Latest Supply Chain-Monopoly Battleground

by | May 11, 2022 | Politics & Corruption

Similac baby formula. Photo: Ajay Suresh, Wiki Commons
Six states are seeing baby formula shortages of more than 50% and stores are limiting purchases to three or four per customer, with prices surging to $33 per can.

A worsening shortage of baby formula in stores across the U.S. is highlighting the urgent need for antitrust regulations, progressives said May 10th.

While Republicans are have attempted to lay blame for the crisis with the Biden administration, J.D. Scholten of the American Economic Liberties Project is among those pointing out that with just a few corporations controlling the majority of the infant formula market, families impacted by a recent recall by one of those companies have few options when looking for affordable alternatives.

“America needs antitrust!” Scholten said.

As David Dayen wrote at The American Progressive Tuesday, just four companies—Abbott Nutrition, Reckitt Benckiser, Nestlé, and Perrigo control nearly 90% of the U.S. baby formula market.

“Any disruption to one of their products will be magnified, whether it’s a recall for Similac or inability to source ingredients,” wrote Dayen. “A few companies in the market relying on the same sources creates a much more fragile supply chain.”

Across the U.S., an average of 40% of infant formulas were out of stock at retailers like Target, Walgreens, and CVS at the end of April, according to Business Insider.

Six states—Texas, Tennessee, Missouri, South Dakota, North Dakota, and Iowa—are seeing shortages of more than 50% and stores are limiting purchases to three or four per customer, with prices surging to $33 per can.

Online, sellers on eBay are raising prices to $120 per can as desperate parents and caretakers struggle to feed their infants, according to the New York Times.

The shortages have been linked to a product recall by Abbott Nutrition—the manufacturer of Similac formula—in February. The company recalled three of its formulas when at least two babies died and four were hospitalized with bacterial infections after consuming the products.

Abbott is the exclusive supplier of formula for more than half of the nation’s Women, Infants, and Children (WIC) agencies, according to the Times. WIC is the nation’s largest purchaser of baby formula, and people who benefit from the program can only be reimbursed if they buy the brands that contract with the government.

“The unprecedented scope of this infant formula recall has serious consequences for babies and new parents,” Brian Dittmeier, the senior director of public policy at the National WIC Association, told the Times.

The Infant Nutrition Council of America, a trade group that represents Abbott and other manufacturers, warned parents against stockpiling formula and suggested consumer behavior is behind any shortages, saying in a statement on feeding infants during the Covid-19 pandemic that “there is no shortage in the supply of infant formula coming from manufacturers.”

Reckitt Benckiser, the maker of Enfamil formula, also claimed the shortage is being driven by an “18% surge in demand for baby formula nationwide.”

“Left unsaid by formula manufacturers,” Dayen wrote, “is their iron grip on the market, which exacerbates supply disruptions. The shortage is a manifestation of the same problems we’ve seen with the supply chain, made worse by monopoly.”

Companies like Abbott spend hundreds of thousands of dollars per year to retain their hold on the market, noted Sarah Klee Hood, a candidate for the U.S. House in New York’s 22nd district.

Dayen pointed out that in 2018, the Trump administration strong-armed Ecuadorean delegates to the United Nations World Health Assembly out of supporting a resolution to support breastfeeding and to urge governments to counter misleading claims about baby formula.

Lobbyists for the industry were present at the assembly, as Common Dreams reported at the time.

The Trump administration’s maneuvers were “stage-managed by the baby formula industry, which particularly wanted to keep its lock on the developing world,” wrote Dayen. “The interests of private monopolists were put ahead of public health and security.”

In the U.S., said Dr. Steven Thrasher of Northwestern University, the corporate-driven baby formula shortage is hitting just as the Republican Party is preparing to roll back the right to abortion care, the majority of which is sought by women who already have at least one child and who live in low-income households.

“It’s appalling that despite great wealth,” said Thrasher, “U.S. capitalism equals no shortage of money for cops (Covid money went to cops!) and money for war (Congress approved $15 billion for Ukraine while denying $15 billion for Covid!) while people are struggling to pay for food, rent, and baby formula.”

Republished with permission from Common Dreams, by Julia Conley

<a href="http://commondreams.org" target="_blank">Common Dreams</a>

Common Dreams

Common Dreams has been providing breaking news & views for the progressive community since 1997. They are independent, non-profit, advertising-free and 100% reader supported.

0 Comments

Submit a Comment

Your email address will not be published. Required fields are marked *

Follow Us

Related Articles

Nov 26 2022

Early Voting Starts Today in Georgia Despite Republican Efforts to Block It

The Georgia Supreme Court on Wednesday ruled against the Republican Party attempts to block local election officials from conducting advanced voting the Saturday after...
Nov 24 2022

Huh? Herschel Walker’s Primary Residence Is in Texas?

The question of the day, “How can Herschel Walker represent Georgians when he doesn’t claim Georgia as his primary residence?”
Nov 20 2022

Why Conservative Parents Are Trying to Take Over School Boards

Hundreds of parents hoping to “take back” public education ran for school board seats in the midterms. What’s the actual job that awaits those who win?
Nov 16 2022

Some “Do’s and Don’ts” of How the News Media Should Responsibly Cover Trump’s New Circus

When it comes to Trump, journalists—if they are to serve the public interest—must realize they are reporting on a politician who regularly defies democratic norms and...
Nov 12 2022

Georgia Senate Candidates Back on the Campaign Trail as Trump Factor Could Again Aid Warnock

Trump has been blamed for helping Warnock and Sen. Jon Ossoff win in 2021 when he spent the time before the January runoff telling Georgians the state’s election system...
Nov 10 2022

How Can Congressional Insurrectionists Be Removed from Office Under the 14th Amendment?

There is no question that certain sitting members or newly reelected members of Congress do not qualify for office under 14th Amendment. The real question is whose job...
Nov 07 2022

Billionaires Have Spent Almost a Billion Dollars Trying to Buy the Midterm Election Cycle

According to an analysis released last week by Americans for Tax Fairness, U.S. billionaires who have seen their wealth skyrocket during the coronavirus pandemic have...
Nov 05 2022

New Report Confirms Corporations Use Inflation as an Excuse for Price Gouging and Profiteering

Under the guise of inflation, certain corporations excessively hiked prices far beyond what their costs necessitated, further driving inflation.
Nov 02 2022

What is “Christian Nationalism” and Why Has It Gotten So Loud

Christian nationalism is more than religiosity and patriotism. It is a worldview that guides how people believe the nation should be structured and who belongs...
Nov 01 2022

Dr. Oz Employs Jan. 6 Insurrectionists as Campaign Staff

One could get the idea that Dr. Oz might not actually qualify for the Senate since by hiring insurrectionists he has given “aid and comfort” to enemies of...
Subscribe for Updates!

Subscribe for Updates!

Join our mailing list to receive the latest news and updates from our team.

You have Successfully Subscribed!

Pin It on Pinterest

Share This