New Delhi: It’s been nearly three months since families in the US grappled with a nationwide shortage of infant formula. President Joe Biden Wednesday Told After meeting with some of the country’s top manufacturers, it will take “a few more months” until supplies are fully “back to normal”.
Last week, the first shipment of infant formula from Europe arrived in Indiana on a US military plane. More shipments are due from the UK and Australia in the coming weeks. This was under the Biden administration’s ‘Operation Fly Formula’ mission.
The crisis first began in February when a plant owned by a top producer shut down, affecting a major supply chain. But there was a significant increase in out-of-stock rates during the month of May. In the first week of May, 40 percent of major US retailers were out of stock. In the week ending May 28, this figure increased to 74 percent. reports,
shortage has also brought price gouging In several states, Biden has prompted calls for the Federal Trade Commission to investigate such incidents.
Baby formula—a powder or liquid-concentrate containing dehydrated cow’s milk, vitamins, and sugar that can be mixed with water to be used to feed infants—is considered a nutritious alternative to breast milk. Some babies require specific infant formula due to allergies or indigestion.
ThePrint describes how the Biden administration has treated the baby formula shortage as a wartime phenomenon and how the crisis has sparked concerns about a monopoly in the baby formula market in the US.
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What is the Defense Production Act enacted by Biden?
In February, baby formula manufacturing company Abbott was forced to halt production at one of its plants in Sturgis, Michigan due to contamination. It is the largest facility in the US for baby formula and sources major brands such as Similac.
The company is currently collaborating with the US Food and Drug Administration under a legal agreement to reopen the site.
The Biden administration has treated the ongoing crisis as a wartime event. US President on May 18 Applicable Defense Production Act to accelerate production and direct necessary resources to baby formula manufacturers. He also launched ‘Operation Fly Formula’ to expedite the import of supplies using American warplanes.
Passed in September 1950, the Defense Production Act has its roots in the Korean War. At the time, there were fears that post-war, consumer goods and, to a lesser extent, inflation, would hurt domestic defense production in the US, as a report good In Conversation tells. Defense production was necessary to counter China and the Soviet Union, both of which supported North Korea in the Korean War.
The act gave then-US President Harry Truman the authority to compel manufacturers to create goods and supply services to support defense production, and to set wages and prices, as well as ration consumer goods.
Parts of the Defense Production Act have been amended over the years but the gist remains the same – “to ensure that” vitality of domestic industrial base,
Is there a monopoly in the baby formula market?
The shortage has also raised concerns about the fact that four companies control 90 percent Baby formula on the market in the US. These companies include Abbott which makes Similac, Reckitt Benckiser which makes Enfamil, Nestle which makes Gerber, and Perigo which makes store-brand formula.
There are also concerns about “sole source contracts” under a federal program known as the Special Supplemental Nutrition Program for Women, Infants and Children (WIC), which enables these companies to maintain monopolies in some states. .
WIC primarily provides access to complementary foods and health and social services to low-income pregnant, breastfeeding and postpartum women, as well as infants and children up to five years of age who are found to be at nutritional risk. as of 2018 6.87 million peopleSpread across women, infants and children, receive WIC benefits each month.
How this program works – To reduce costs, each state will have one”sole source contract” For an infant formula manufacturer. This means that a producer holds one contract for the entire state and all WIC recipients are dependent on that one manufacturer.
according to a report good In politician Which used data from the National WIC Association, Abbott has 49 WIC contracts with states, territories and tribal organizations in the US. This covers about 47 percent of babies receiving formula benefits through the WIC program.
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