The president of the United States, Joe Biden, admitted this Wednesday that he was not aware of the crisis of shortages of infant milk until the beginning of April, two months after the closure of a factory of the main manufacturer, Abbott laboratories, accelerated a shortage that had been dragging on since 2021. In a round table with representatives of the Administration and the sector, the president explained: “I noticed the dimension of the problem at some point in early April. We have done everything in our power from that point on,” he said. “I don’t think anyone could have anticipated the impact of a facility closure,” he said, referring to Abbott’s Sturgis, Michigan, factory, enacted after the FDA ) detect signs of contamination in the production lines. Four babies became ill, and two of them died, after consuming milk of that brand.
The crisis of shortage of infant formula (infant milk formula) has been one more headache for the Democratic Administration for weeks. The White House has confirmed this Wednesday the fourth shipment of the Operation Fly Formula, two flights from Australia with a total of 4.6 million cans of baby milk on board. The cargo, which will arrive at airports in Pennsylvania and California next week, adds to the two million containers that from the United Kingdom will contribute to alleviate the deficit, in a crisis that lasts for months and that especially hits low-income families. The slogan of the White House is clear: replace the shelves of supermarkets and pharmacies as soon as possible.
Just two weeks ago, Biden resorted to a Cold War-era national security law to speed up the arrival of supplies to the country, with the adoption of two main measures, the relaxation of the requirements of the FDA (main regulator) and therefore of customs procedures, and the establishment of an air bridge, in collaboration with the Air Force, to import stocks quickly. The first two planes arrived from Germany last week, the last of them being greeted on the tarmac by First Lady Jill Biden, a gesture that underscores the importance the White House attaches to the issue. On board, the equivalent of 1.5 million 8-ounce bottles (about 225 grams) of infant formula arrived in the United States, the composition of which had been previously approved, by way of urgency, by the regulator.
Following Nestlé and Danone, which have taken the lead, infant formula manufacturers around the world are exploring the opportunities arising from the liberalization of entry procedures. After Bubs Australia closed its first agreement with the FDA last week to ship 27.5 million canisters, several New Zealand dairy companies, including Fonterra, the largest dairy exporter with a 30% share of the global market, They contemplate following in his footsteps. Fonterra has an extensive presence in Latin America.
With these measures, Biden aims to quickly put out a fire that is adding to the continued pressure of inflation and the consequences of the great global bottleneck in supply chains, with little more than five months to go before the decisive mid-term elections. in which the Democrats risk their precarious majority. Hence, communications from the White House on addressing the dairy crisis, which has left almost half of the market out of stock, are practically daily. This Wednesday, they have also confirmed the third shipment of the so-called Operation Fly Formulawhich will transport a total of two million cans of formula from the United Kingdom to the main US airports over the next three weeks.
How the world’s leading economy has been plunged into a similar shortage crisis is explained, in part, by the composition of the infant milk market: an oligopoly in which four companies share sales. The most important of them, Abbott laboratories, was forced to practically suspend its activity in February with a serious impact on the market, since its production represented almost half of the oligopoly’s turnover. The US was until then self-sufficient, with 90% of the total production. But the crisis had been dragging on since 2021, due to interruptions in the global supply chain. The shortage especially affects families that depend on a maternal and child health reinforcement program known as WIC, in its English acronym, which establishes very strict supply contracts between manufacturers and the corresponding States. This administrative rigidity also aggravated the shortage, which erupted in May.
Thousands of desperate fathers and mothers then launched themselves in search of substitute milk for their babies, while others opted for homemade formulas against whose consumption the health authorities warned. The White House ordered the Department of Justice last month to monitor market abuses (exorbitant prices, hoarding, Internet deception, etc.). Milk banks have registered unprecedented peaks of activity in recent weeks, as an alternative solution. “Although our priority is to provide milk to premature babies, full-term babies can also receive prescription donor milk, as long as we have availability,” explains Linda Harelick, executive director of the Milk Bank of New York. “We are seeing great support from mothers who want to donate their excess milk. On a typical day, we can handle one or two requests, and now they have ballooned to more than 20. Also, since the beginning of the year, requests for milk have more than doubled. It is an unprecedented situation and we are doing everything we can to help the babies.”
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